Vanguard Group in Malvern, Pa., announced Thursday that it had begun constructing a portfolio for its new Strategic Small-Cap Equity Fund.
This "subscription" period is to end no later than May 5, when the fund's long-term investment strategy is to be executed.
Vanguard's Strategic Small-Cap Equity Fund will seek to provide long-term capital appreciation by investing in small-capitalization U.S. stocks. The fund company said its quantitative equity group will use computer-driven models to invest in stocks in the Morgan Stanley Capital International U.S. Small-Cap 1750 Index.
The new fund is the second actively managed stock portfolio entirely advised by the quantitative equity group, which oversaw nearly $400 billion of index fund assets at March 31 and $20 billion of active quantitative equity fund assets. The fund's estimated expense ratio is 0.40%, Vanguard said, about one-quarter the 1.58% expense ratio for the average small-cap equity fund, according to data from Lipper Inc.
"The new Strategic Small-Cap Fund reflects our growing focus on active quantitative equity management strategies," Vanguard chief investment officer Gus Sauter said in a press release.
