# Vanguard Total Int.Stock ETF (VXUS)



## PuckiTwo (Oct 26, 2011)

When checking out this ETF the foll discrepancies came up:

1. TDW Markets&Research says:
Best Fit Index: MSCI ACWI Ex USA IMI NR USD
Inception: April 29, 1996
Closing price per Jan 11/13: $47.91 / 
NAV per Sep 30/12: 14.98
Dividend yield: 5.38%

2. Vanguard’s site says:
Market price per Jan 10/13: 47.92
NAV per Jan 10/13: 47.74
Dividends: Quarterly
However, fund paid only twice distributions in 2012

A supplement to the prospectus addressed some of the differences: _“The board of trustees of Vanguard Total Internationl Stock Index Fund has approved the adoption of FTSE Global All Cap ex US Index as the new target index for the Fund, *replacing* the MCSI All Country World ex USA Investable Market Index..............”_

A phone call to Vanguard brought the information that VXUS is *virtually a new fund *initiated early January/February 2011. Fund unable to pay quarterly dividends in 2012 due to its performance. Actual dividend around 3%. Seems that TDW website was not updated or am I missing something?

I saw the fund mentioned several times in CMF threads. My question to CMFers, are you discussing the old or the new fund? Do you who own the fund since before 2011 care that the index changed?


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## GoldStone (Mar 6, 2011)

It's true that VXUS is a new ETF started in 2011. However, the corresponding mutual fund (VGTSX) is far from new. It started on 04/29/1997. You can think of the ETF as a repackaged mutual fund. IIRC, Vanguard patented this structure where the same basket of securities is available as a mutual fund and an ETF.

VXUS/VGTSX changed their target index from MSCI to FTSE. The composition of the two indexes is fairly close. I don't own VXUS but if I did, I wouldn't be too concerned about this change.

FTSE index is cheaper to license, that's the motivation behind the index change. Vanguard is expected to eventually pass the savings on to the unit holders.

TDW info about the dividend yield is obviously wrong. This (wrong info) is all too common. Always go to the source, i.e. ETF provider web site.

VXUS (ETF)
https://personal.vanguard.com/us/funds/snapshot?FundId=3369&FundIntExt=INT#tab=0

VGTSX (Investor Shares mutual fund)
https://personal.vanguard.com/us/funds/snapshot?FundId=0113&FundIntExt=INT#tab=0


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## Spudd (Oct 11, 2011)

I don't think they were unable to pay distributions in 2012 due to performance, rather, they changed a lot of their ETFs from paying annual distributions to quarterly distributions, starting Sept 2012. 

https://advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_NewsTransFeeDiv


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## PuckiTwo (Oct 26, 2011)

*Goldstone:* Thks - great info and helpful as always. 

*Spudd:* Thks to you too for the helpful link. Yes, I have now seen the change anouncement, but that’s not what the Vanguard rep said on the phone. He did say “....does not pay distributions when the fund is not performing well and that it paid only 2 x distributions in 2012 because of that”.... Who knows - maybe it was Vanguard’s janitor I had on the phone.

Vanguard has now started to change from MSCI to FTSE, starting with VWO, followed by VEA http://blogs.barrons.com/focusonfun...-changeup-started-this-week/?mod=yahoobarrons 

I think I may go with VEF instead of VXUS as the latter holds also Canada and we have 100% Canadian investments. I haven’t made a decision yet if to go with VEF or VEA (CAD hedged). CAD hedged is probably more expensive but I'm somewhat concerned about currency losses. Any thoughts? Thks.P.


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