Betterment Acquired Vanguard ETFs

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ByI. Mitic
June 16, 2021

The robo-advising and cash management services company, Betterment, increased its investment in several Vanguard exchange-traded funds in Q1 of this year.

The financial advisor expanded its holdings in Vanguard Total International Bond ETF, Vanguard Short-Term Inflation-Protected Securities ETF, and Vanguard FTSE Developed Markets ETF and added more shares of Vanguard FTSE Emerging Markets ETF.

Betterment explained in a statement that its recent activities are standard procedure. 

We build diversified portfolios that we rebalance automatically for our customers over time so as to help them meet their goals. With any rebalancing that we do, we always do as much as possible to keep their capital-gains taxes at a minimum.

In Q1, Betterment added 56,000 new clients to the platform, up 116% year over year, and beating a previous quarterly client record by 59%. For every client that comes to Betterment, we create and recommend a personalized diversified portfolio for them to reach their specific financial goals,” Betterment’s statement reads. 

Despite the economic downturn and market turbulence in 2020, Betterment’s assets continued to grow. The company’s managed assets rose to $29 billion as of April this year. 

Back in March, Betterment announced its acquisition of Wealthsimple’s US book of business. Under the terms of the deal, Wealthsimple will have to transfer all of its US customers to Betterment. Wealthsimple manages around $190 million across 17,000 US accounts. Customers have the option to opt out of the transfer, but Wealthsimple will no longer be supporting US-based accounts.  

Peter Lorimer, the newly appointed CFO at Betterment, said: “At Betterment, we take our name to heart; continuously optimizing on behalf of our clients is in our DNA.” 

Our growth is built on the combination of an innovative, tech-first culture and the experience and trust of a company that's been delivering investment management results for over a decade,” Lorimer added. 

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