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Vanguard, the world’s second-biggest asset manager, is planning a fresh push into the active fixed-income market, citing “extraordinary” inefficiencies and opportunities.

While the firm is better known for its equities business, increasing its scale in fixed income is a priority, according to chief executive Salim Ramji. Roughly 10 per cent of Vanguard’s assets are currently allocated to active fixed income.

Fixed income “is going to be more important as people retire . . . it’s going to be more important in, at least our view is, the long term rate environment”, Ramji told a Financial Times conference on Wednesday.

“If you think of the fixed income market today . . . it’s far more antiquated, it’s far less transparent, far more expensive,” he said, in one of his first interviews since becoming Vanguard’s chief executive in July. “I think there’s an opportunity that Vanguard has to change that dynamic.”

The move has the potential to rock the bond management industry by pushing down fees significantly. Vanguard, which has $9.7trn in assets under management, has already redefined equity investing, as investors flocked to its low-cost products.

Ramji said the firm had plans to bring more of its heft into the actively managed fixed income market. He also criticised the fixed-income market for high fees and lack of transparency, which he said benefited firms more than their clients. “The opportunity set is vast when you look at the fixed-income market. It’s twice the size of equity market and the inefficiencies in fixed income are extraordinary.”

He noted that Vanguard’s actively managed fixed-income fund cost just 14 basis points, significantly less than other active managers as well as the average for passive fixed-income funds. “What this shows is the whole dichotomy between I want great performance [or] I want a low price is a false dichotomy.”

Ramji is the first outsider to lead the asset manager since its founding in 1975. Previously he was a top executive at BlackRock, its main competitor that is the world’s biggest asset manager.

“It sounds like they are doubling down” on moves into bonds that began before Ramji arrived, said Dan Sotiroff, the lead analyst on Vanguard for Morningstar. He noted that active bond managers have a stronger record of beating their indices than equity funds. “It makes perfect sense. [Active bond funds] are a little more ripe for the picking.”

Vanguard revolutionised the asset management industry through low-cost index investing under founder Jack Bogle, and 80 per cent of Vanguard’s assets are in passive index funds.

However, the push into fixed income comes at a time when the asset manager is already under political pressure during an election year from both the left and right for its tremendous size, and the amount of shares it holds in many US companies.

Ramji also walked a fine line around the firm’s decision to support none of the environmental or social shareholder proposals that it considered in the 2024 proxy season. ESG has become increasingly politicised in the US.

Ramji said: “We don’t dictate to companies what their strategy should be, we don’t push a particular agenda.”

He also addressed technical and service failures that have plagued the manager in recent years as the industry has rapidly modernised, and acknowledged that the firm, had “let down” its customers. “We have some work to do,” he said.

This article has been amended to reflect that Vanguard has $9.7trn in assets under management

MCDONALD’S lovers have been going wild for its new breakfast menu item saying it reminds them of a classic American snack.

The home of the Golden Arches will soon start selling mini hashbrowns.

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McDonald’s already sells larger hashbrowns as part of its regular breakfast menu.

However, these new fried potato bites will come in a bigger portion but will be smaller in size, with a five-pieces costing £1.49.

You can also get a 15-piece sharebox for £2.99.

Talk of the new menu item is already causing quite a stir on social media, with many fans saying it is exactly like a popular American snack.

Commenting on a social media post one user said: “Looks like Tater Tots to me.”

“Otherwise known as a Tater Tot,” said another.

Tater Tots are a popular snack in America and are made by grating up pieces of potatoes which are then deep-fried in to small ball shapes.

The starch-based side is also sold in the UK with Sainsbury’s selling a frozen version of them called Hash Brown Bites for £2.10.

Birds Eye also sells something very similar called Potatoe Bites for £2.50 in Asda, but you will have to cook these at home yourself.

Fans were still excited to try out McDonald’s take on the classic, with one customer saying they needed to be an “all-day item.”

While another said they “needed to try them”.

If you are keen to try out the fried snack you will have to wait untill October 16, when they officially land in stores.

You will also have to get to your local Maccies bright and early because they will only be available from 6am-11 am.

It is still unclear whether or not the morning dish will become a permanent menu item or will only be available for a limited period of time.

All you need to know about McDonald’s

HERE’S all the crucial information about McDonald’s you’ve always wanted to know…

In 2022, the home of the Golden Arches added mini potato waffles to its morning menu but they were axed the following year.

At the time, fans said they tasted better than its hashbrowns.

Customers have seen a number of limited menu items arrive in stores over the past year.

This includes the Grimmace Shake which was only available for one week back in August.

Changes at McDonald’s

Talk of a new menu item comes just days after Maccies hinted the McRib could once again land in stores.

A test notification for the boneless pork burger was sent out on the McDonald’s rewards app.

When asked if the McRib is coming back, a spokesperson said: “McDonald’s is always looking to innovate with new and exciting menu items, as well as bringing back the fan favourites.

“If you’re keen to be the first to receive more info from McDonald’s stay tuned.”

The McRib was first added to the main UK McDonald’s menu in 1981 but was taken off just four years later.

The burger, which comes with a boneless pork patty covered in barbecue sauce and topped with onions and pickles, has made temporary reappearances since.

It has remained a permanent fixture at McDonald’s in Germany.

What else is new at McDonald’s?

McDonald’s will regularly switch up its menu to make way for new items.

Earlier this month, the fast food chain changed its menu to coincide with the launch of McDonald’s monopoly. 

To take part in the game you must collect stickers that represent train stations or colour-coordinated streets. 

If you are curious about how the game works and what prizes you can win, read our article here. 

To mark the return of its sticker peeling game McDonald’s has brought back a number of fan-favourites

These include:

• Mozzarella Dippers 
• Philly Cheese Stack.
• Chicken Big Mac, 
• Galaxy Chocolate McFlurry 
• Twix Chocolate McFlurry
• Twix Latte 

If you are keen to try any of these new menu items you will need to act quickly as they are set to be pulled from restaurants in about three weeks.

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Here’s an unsatisfying chart:

Deutsche Bank says it was inspired to run the numbers by the European Union’s Competitiveness report released a couple of weeks ago. Here’s the relevant bit of Mario Draghi’s foreward:

First – and most importantly – Europe must profoundly refocus its collective efforts on closing the innovation gap with the US and China, especially in advanced technologies. Europe is stuck in a static industrial structure with few new companies rising up to disrupt existing industries or develop new growth engines.

In fact, there is no EU company with a market capitalisation over EUR 100 billion that has been set up from scratch in the last fifty years, while all six US companies with a valuation above EUR 1 trillion have been created in this period.

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This lack of dynamism is self-fulfilling.

Note the careful phrasing. “Set up from scratch” excludes the likes of AstraZeneca (founded 1999 by the merger of Astra and Zeneca).

Nevertheless, Draghi’s wrong and so is Deutsche Bank. Here’s a different chart:

It shows all the constituents of Bloomberg World Large and Mid-Cap Index organised (where available) by date of incorporation. Countries and territories are all clickable.

Obviously, incorporation dates are even weaker than Deutsche’s finger-in-the-air approach when trying to estimate when companies were founded. Lots of things happened to make Saudi Aramco, for example, before its commercial registration was filed in 2018. Shell, clearly, wasn’t created in 2002.

Still, incorporation dates are enough to run a quick fact-check. Here’s the dot that matters:

PDD Holdings, the US-listed owner of the Temu and Pinduoduo e-retail platforms, moved its corporate registration from China to Ireland in May 2023. It was founded nine years ago and on current standings has a market cap equivalent to €140bn, so fits both of Draghi’s criteria.

All hail PDD, the future of European Union innovation.

Further reading:
— The mysterious rise of the Chinese ecommerce giant behind Temu (FT)

FALL-lovers are raving about a $1.25 craft piece from Dollar Tree. 

Shoppers have dubbed the store’s carvable pumpkins as “perfect size” for getting your craft on this Halloween. 

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The foam ornaments, which are four inches tall and five and a half inches wide, can be turned into vases, candy buckets or used as part of your spooky display. 

They’re also a smaller dupe for the Michaels’ Orange Craft Pumpkins by Ashland. 

But while the Michaels version will set you back $19.99, Dollar Tree’s Carvable Foam Pumpkins are 88% cheaper at $1.25. 

The inexpensive design has received rave reviews from crafty Americans. 

One self-confessed fall lover said: “I’ve used these for the last couple of years for DIY and fall home decor.

“They’re so much fun to paint and decorate your own way. 

“They’re very affordable and easy to use.”

Another quipped: “These pumpkins can be carved and used to make different types of pumpkins.

“Such as painted, or covered with fabric or yarn. 

“They are easy to work with.”

A third beamed: “There’s so much you can do with these. 

“All you need is some paint, felt, craft wood, yarn, an X-acto knife and glue. 

“If you can imagine it, you can make it!”

The Michaels pumpkins have similarly good reviews, but for the price of one, you can pick up 15 in Dollar Tree.  

Halloween dupes

There are several Halloween dupes to help you celebrate on a budget.

Dollar Tree has $3 haunted plants that are 90% cheaper than the ones at Michael’s.

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The discount store also has hanging pats for just $1.25, while a major competitor sells them for $15.

Pottery Barn fans found a dupe for the store’s famous floating ghosts that are 61% cheaper.

Shoppers even found a dupe for Disney’s famous character pumpkins at Kohl’s.

A blurb on the pricier crafts reads: “Brighten up your Halloween decor with this craft pumpkin.

“You can decorate this accent with sparkly embellishments, paint with any multi-surface paint or carve it with a hot knife tool. 

“Display it among LED pillar candles on your mantel.”

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

The album that electronic producer Sophie Xeon was working on as a follow-up to her acclaimed debut will never be heard, at least not in the state intended by its maker. The UK musician, who recorded as SOPHIE, died in 2021 aged 34 after falling accidentally from an Athens building. The album now appearing as Sophie is a posthumous assembly of tracks from the unfinished work in progress.

In certain respects, its timing is opportune. Hailed as a visionary while alive, the producer’s repute has grown since her death. Sophie was associated with hyperpop, the sub-genre spearheaded by London record label PC Music more than a decade ago. This archly affectionate, highly conceptualised, extremely online take on chart pop and dance music has filtered into the mainstream. Charli XCX, she of the “brat summer”, is the most prominent example. “You had a power like a lightning strike,” she sings in Sophie’s memory on this year’s breakthrough Brat album.

The producer was a mysterious figure at the start of her career, little more than a name, or even a rumour. She became more visible on her debut studio album, Oil of Every Pearl’s Un-Insides, released in 2018 after her announcement that she was transgender. Her electronically processed voice had a starring role in its songs, which were composed from a startling collision of abrasiveness, experimentalism, kitsch and catchiness. Themes of artificiality and realness, technology and feeling, gave the music a posthuman character. (Sophie’s desire to move into a new form of being apparently extended to rejecting all third-person pronouns, gendered or otherwise.)

The album Sophie tries to give posthumous life to her posthuman soundworld. Its tracks have been completed by her studio-manager brother Benny Long, her closest collaborator. Lasting over an hour and featuring many guest vocalists, it comes across as a labour of love. But the results are patchy.

With her voice absent from the songs, the figure of Sophie retreats back into the shadows. DJ Nina Kraviz drones about “unpredictable reality” over clichéd cosmic swooshes in “The Dome’s Protection”. Multidisciplinary artist Juliana Huxtable repeats “Plunging Asymptote”’s esoteric title over stop-start electronic outbursts as though stuck on autorepeat. Matters pick up with a move into club music with “Do You Wanna Be Alive” and “Elegance”, which have sharp beat switch-ups and sound design. But the album lacks the coherence and purposefulness of Sophie’s previous work. It pays tribute to a sadly extinguished talent.

★★☆☆☆

‘Sophie’ is released by Transgressive/Future Classic