Vanguard relaxes trading restriction on funds to 30 days

(Reuters) - Vanguard Group Inc, the No. 1 U.S. fund company, said on Wednesday its investors can now trade in the same fund within 30 days, compared to the previous policy of 60 days.

The announcement comes during a tumultuous time on global markets. The S&P 500 Index is off 6 percent over the past month while Hong Kong's Hang Seng Index is down 8 percent during that time, reflecting a stock market meltdown in China.

"The 30-day restriction seeks to better accommodate investors’ transaction needs, including tax-loss harvesting and rebalancing, while still affording the funds and shareholders protection against excessive trading," Vanguard said in a statement.

Vanguard's revised restrictions apply to all Vanguard mutual funds, with the exception of money market and short-term bond funds. The policy also does not apply to Vanguard exchange-traded funds because they trade intraday, much like stocks.

Participants in defined contribution retirement plans for which Vanguard provides record keeping will become eligible for the 30-day purchase hold in mid-2016, the company said.

(Reporting By Tim McLaughlin; Editing by Chizu Nomiyama and W Simon)

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