Vanguard’s $16.7 trillion ETF portfolio will get a bigger payout this year, thanks to the Federal Reserve’s latest move to lower interest rates.
The move to raise rates, which will likely hit stocks in 2018, is expected to generate the biggest annual gain for Vanguard since 1999.
But it also could hit some of the biggest ETFs like Vanguard’s FTSE 100 and S&P 500, which each have $4.3 trillion in assets.
Vanguard’s funds were up 6.5% for the year to $21,084.49.
Vanguard is one of the best-performing funds, up almost 3% year to date.
The fund also saw the largest gains in the S&p 500, up 1.4%.
Vanguard is a diversified fund that includes the FTS, S&P 500 and Russell 2000.
“We are seeing continued strength in the Fidelity and Vanguard funds, as the fund’s value increases in all asset classes, and our portfolio is a strong reflection of this,” Vanguard chief investment officer Mike Nardi said in a statement.
Vanguard currently has $16 trillion in ETF assets, or about 6% of the U.S. ETF market.
The fund’s portfolio has grown to about $5.8 trillion since it went public in January.
Vanguard has about 6,500 fund managers and $4 trillion in investments.
