Vanguard Mortgage-Backed Securities Fund (VMBS)
NASDAQ (NMS) NASDAQ (NMS) Primary Summary
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VMBS: NAV Probability Shift
Vanguard Mortgage-Backed Securities ETF offers liquid, high-quality exposure to US agency MBS with minimal credit risk. I recommend a qualified Buy, anticipating NAV appreciation if the Fed pursues a gradual rate-cut cycle into 2026. VMBS's intermediate duration, 3.87% yield, and ultra-low 0.03% expense ratio make it a compelling, cost-efficient choice versus peers.
Mortgage-Backed Securities Offer a Home for Income Seekers
For investors looking for fixed income diversification, mortgage-backed securities (MBS) could offer a happy home. Specifically, they should look into broad-based exposure via the Vanguard Mortgage-Backed Securities Index Fund ETF Shares (VMBS).
Mortgage Bond Investors Help Push Rates Lower
As noted in USA Today, dipping mortgage rates could be attributed to the improving sentiment of bond investors. That's especially the case for those investing in mortgage bonds.
Vanguard Mortgage-Backed Securities Fund (VMBS) FAQ
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Does it pay dividends? What is the current yield?
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Has Vanguard Mortgage-Backed Securities Fund ever had a stock split?
Vanguard Mortgage-Backed Securities Fund Profile
| NASDAQ (NMS) Exchange | US Country |
Overview
The fund is strategically positioned within the investment landscape to offer investors exposure to U.S. agency mortgage-backed securities (MBS). By adhering to an indexing investment approach, the fund's primary objective is to closely mirror the performance of the Bloomberg U.S. MBS Float Adjusted Index. This benchmark index is comprehensive, encompassing U.S. agency mortgage-backed pass-through securities that are issued by the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA), and the Federal Home Loan Mortgage Corporation (FHLMC).
Products and Services
- Indexing Investment Approach
- Sampling Process Investments
- Mortgage-Backed Securities (MBS) Investment
The fund utilizes an indexing strategy aimed at tracking the Bloomberg U.S. MBS Float Adjusted Index. This approach is designed for investors seeking exposure to the U.S. mortgage market, specifically focusing on securities that have a minimum pool aggregate of $1 billion currently outstanding and a weighted average maturity of at least 1 year.
In achieving its investment objective, the fund employs a sampling process to select investments. This method involves choosing a subset of bonds that collectively are intended to replicate the financial characteristics and performance of the index. As a result, it facilitates efficient fund management while striving to match the benchmark's return.
Consistent with its investment strategy, at least 80% of the fund's assets are directly invested in bonds that are included in the Bloomberg U.S. MBS Float Adjusted Index. This includes U.S. agency mortgage-backed pass-through securities, which are pivotal for investors aiming to diversify their portfolio while tapping into the residential mortgage market.
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