Vanguard to enter UK ETF market in 2010

Vanguard plans on launching its inaugural range of ETFs for the UK market this year, offering low-cost funds with minimal tracking error.

The firm has a well-established US platform of ETFs in line with most of its open-end mutual funds and aims to take a similar approach in the UK.

Vanguard UK managing director Tom Rampulla says: "We won't launch 30 funds at once, we'll aim to launch a handful of ETFs and then grow over time."

He says Vanguard will provide ETFs which are among those with the lowest costs, while tracking indices efficiently.

He adds: "If you look at Vanguard's tracking error over decades, it's among the best in the industry."

Rampulla says the firm is uniquely positioned as it is mutually owned by mutual fund investors in the US. As a result, Vanguard is client-focused and aims to educate financial advisers.

He says: "The package of value on the investment side, plus our focus on clients is rather unique and that's what has made us a success in the US. That is how we will position ourselves in the UK."