The Vanguard USD Corporate 1-3 Year Bond UCITS ETF (USD) Accumulating (VDCA) is an Ireland-domiciled fixed-income ETF managed by Vanguard and traded in U.S. dollars on the London Stock Exchange.

The fund seeks to track the Bloomberg Global Aggregate Corporate – United States Dollar Index 1-3 Year, a benchmark composed of a broad range of U.S. dollar-denominated corporate bonds with maturities between one and three years that are generally rated investment grade.

VDCA provides exposure to the short-term U.S. dollar-denominated corporate bond market. The fund follows a passive investment strategy and uses physical representative sampling, holding a selection of bonds designed to closely match the performance and risk characteristics of its benchmark.

The index tracks fixed-rate corporate bonds denominated in U.S. dollars. Its one-to-three-year maturity requirement concentrates the portfolio in the shorter-duration portion of the corporate credit market, reducing interest-rate sensitivity relative to comparable longer-maturity bonds. 

Composition / Exposure Profile

VDCA primarily holds U.S. dollar-denominated corporate bonds and can include issuers across different areas of the economy, including:

• Financials.

• Industrials.

• Technology.

• Health care.

• Consumer sectors.

• Energy.

• Utilities.

• Communications.

Portfolio securities have maturities concentrated between one and three years and are generally investment grade. The fund can hold debt issued by companies from different countries, provided the securities are denominated in U.S. dollars and meet the benchmark's eligibility requirements.

Because the fund focuses on corporate debt, its performance is influenced by both interest rates and credit-market conditions. Changes in issuer creditworthiness, credit spreads, and the broader economic environment can affect the value of portfolio securities.

Structure and Costs

VDCA has the U.S. dollar as both its base currency and share class currency. On the London Stock Exchange, the USD listing trades under the ticker VDCA. The same share class also has listings in other trading currencies, including VSCA in GBP on the LSE and VAGY in EUR on Deutsche Börse.

The ETF has an ongoing charges figure of 0.09% per year and uses physical representative sampling. It is domiciled in Ireland, operates under the UCITS framework, and is part of Vanguard Funds plc.

VDCA is an accumulating share class, meaning interest and other income generated by portfolio securities are reinvested within the fund rather than distributed periodically to shareholders.

History and Evolution of the ETF

The Vanguard USD Corporate 1-3 Year Bond UCITS ETF (USD) Accumulating (VDCA) was launched in 2019 to provide exposure to the short-term segment of the U.S. dollar-denominated corporate bond market.

Since its launch, the fund has maintained a passive strategy linked to the Bloomberg Global Aggregate Corporate – United States Dollar Index 1-3 Year, combining diversification across corporate issuers with a maturity range concentrated between one and three years.

Throughout its history, the fund's performance has primarily reflected conditions in corporate credit markets, changes in U.S. interest rates, credit spreads, and expectations surrounding economic activity and monetary policy.

Additional Information

Vanguard USD Corporate 1-3 Year Bond UCITS ETF (USD) Acc (Ireland) is an exchange-traded fund (ETF), with assets under management totaling $2.11 billion.

Over the past 12 months, Vanguard USD Corporate 1-3 Year Bond UCITS ETF (USD) Acc recorded a return of 2.10%, with its price trading between $60.36 and $62.33 during the same period.

The ETF is traded under the ticker VDCA.