Vanguard to Liquide Its First Mutual Fund Since 2020

(Bloomberg). Vanguard Group, an asset manager, plans to close a US mutual fund. This is the first time that this has been done since the pandemic.

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According to Tuesday’s press release, Vanguard Alternative Strategies Fund (ticker VASFX), the $98 million Vanguard Alternative Strategies Fund will be liquidated in 2023’s second quarter. This fund, which was established in 2015, will be liquidated. “has not gained broad acceptance among investors,” Vanguard stated.

According to a spokesperson, the liquidation is the first time Vanguard, Malvern-based in Pennsylvania has shut down a mutual funds since winding up the NJ Municipal Money Market Fund (and PA Municipal Money Market Fund) in 2020. The move follows a brutal year for asset managers as the Federal Reserve’s historically aggressive tightening campaign pummeled both stocks and bonds, driving investors to yank billions of dollars from mutual funds.

“Liquidations are part of the fund life cycle, and they tend to increase in tough markets,” Eric Balchunas at Bloomberg Intelligence is a senior analyst on exchange-traded funds. “We expect to see more of this in the coming year.”

Vanguard, which oversees $7.6 trillion worth of assets, also announced Tuesday it would merge the Vanguard Managed Allocation Fund ($1.2 billion) with the Vanguard LifeStrategy Moderate Growth Fund (17.9 Billion). The Vanguard U.S. Fund was liquidated by the firm in November. Liquidity Factor ETF, (VFLQ), was the firm’s first ever US ETF to be closed.

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