The Vanguard Group is a privately-held investment management company based in Pennsylvania, United States. It has over $5.3 trillion of assets under its management and is the largest provider of mutual funds in the world. Vanguard provides brokerage services, asset management, trust, and educational account services. It also offers variable and fixed annuities services along with financial planning.
Vanguard was founded by John C. Bogle in 1975 and is the second-largest provider of exchange-traded funds in the world. Many mutual funds managed by the vanguard group are among the top of the list of US mutual funds by asset under management. It generally provides two classes of funds, namely investor shares, and admiral shares, with the later one having a lower expense ratio but requiring a higher minimum investment. Vanguard is owned by its customers because it is owned by the funds managed by the company. Hence, it makes Vanguard a profound choice for its customers.
- Client first culture
- Superior performance
- 83% lower costs than average
- Enduring investments
- Proven approach
- Stable leadership
- Passion for service
Vanguard is regulated by the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC). It has a good track record and is considered safe.
Vanguard offers the account opening services to its customers digitally; it is fully user-friendly. One of the benefits of the customer is that there is no or low minimum deposit, but opening and verification of the account takes a long time. It provides the facilities to open various account types:
Business Accounts – These accounts are used to track the money, balance, and cash owed to the business, creditors, and also payroll paid to employees.
Joint Brokerage Account – These accounts have two or more account holders listed on them and allow multiple people to have control over the investment account.
Trust Account – A trust account is an arrangement where funds are held by third-party legally for the benefit of another party.
IRA Account – It is a type of individual retirement plan that provides tax benefits for retirement savings.
Vanguard provides a web trading platform for its customers. Though the web trading platform is complex, yet it has a safer login and price alerts than other platforms. It also provides a clear fee report. It also has a user-friendly mobile trading platform. It is user-friendly and has a good search function. It provides a basic order interface for the investor but is not suitable for active traders.
Vanguard gives access to different services from stocks to bonds. Its asset classes are:
Stocks – A share that gives a fixed dividend to the holder. Its payment takes priority over the ordinary share dividends
ETF – An exchange-traded fund is a group of securities that trade on an exchange. It is bought and sold all day, unlike a mutual fund that only trades once a day.
Mutual fund – A mutual fund is an investment fund that pools money from many investors to buy securities.
Bond – Bond is an instrument of the financial obligation of the bond issuer to the holders.
Option – An option is an instrument that gives a buyer the right, but not the obligation to buy or sell an underlying instrument at a specified price.
Vanguard gives access to the US market only. It has an average coverage of mutual funds. It covers both corporate and government bonds. It covers US and CBOE options exchanges. It advises its customers using the help of experts and its Robo-advisor technology.
Vanguard customer service is very straightforward and effective. If a customer is having an issue, he/she can get help by calling the company’s skillful employees. Though the live chat on the website or platform is missing. It provides fast and relevant answers to the queries of the customers. They have quick response-time both from telephone and e-mail. They are also not accessible 24/7.
Vanguard does not charge on ETF trading. Also, no fee is charged on inactivity, and some bonds and mutual funds are also free. Fees of some mutual funds are high, and you have to give trading fees when you trade. Financing rates are also high in the lower volume tiers. Vanguard trading fees are average and are comparable with other brokers. Though the fee structure is transparent, it is still a bit complex and hard to understand.
The Vanguard financing rate is linked to volume. It adds base rate and a premium and depends on the financed amount. Its treasury bonds are free, but municipal bonds are not free of charge, and you need to pay some amount for it. Options fees are average and charge low non-trading fees.
Vanguard is user-friendly and gives trading ideas. Its data is based on asset fundamentals. It uses fundamental data and has various research tools.
As Vanguard is regulated by SEC and FINRA, it has a high level of investor protection. All the customers of Vanguard are protected by the SIPC, the US investor protection scheme. It protects against the loss of securities and cash. It covers notes, bonds, stocks, mutual funds, company shares, and registered securities. It does not offer negative balance protection.
Vanguard has fair production quality and provides education videos for its customers. It also provides webinars and quality educational articles. It contains good quality content targeting its audience and making them knowledgeable and smart. It also has podcasts and other downloadable videos featuring various topics regarding broking and finance.
Vanguard dominates the investment business and is one of the biggest US stockbrokers. It provides a free ETF, and the account opening is easy and digital. It has a tremendous amount of planning and educational resources and helps in setting up easy to manage investment plans. But it covers only the US markets, and financing rates are also high as compared to other brokers. It provides a huge basket of low-cost funds that its customers can buy or sell without commission.