(PUB) Investing 2015
March 2015
Morningstar FundInvestor
7
Data through February 28, 2015 Vanguard REIT Index Adm
Ticker
Status Yield Total Assets
Mstar Category
VGSLX Open
3.5% $54,188 mil
Real Estate
Morningstar Analyst Rating 03-02-15
Investment Style Equity Stock %
Historical Profile Return Risk Rating Above Avg Above Avg Above Avg
98% 98% 100% 99% 100% 99% 100% 100% 100%
Œ
Manager Change Partial Manager Change
15.0 20.0 26.0
Morningstar Pillars Process Performance
Growth of $10,000
∞ ∞ ∞ ∞ ∞
Positive Positive Positive Positive Positive
Investment Values of Fund Investment Values of MSCI Ac Wrld ND
10.0
People Parent Price
6.0
Performance Quartile (within Category) History
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 02-15
Morningstar Analyst Rating Morningstar evaluates mutual funds based on five key pillars, which its analysts believe lead to funds that are more likely to outperform over the long term on a risk-adjusted basis. Analyst Rating Spectrum Œ „ ´ˇ ¨
80.16 30.81 15.58 -0.97
109.15 84.49
87.25
51.75
63.33 29.76 -4.87
78.44 28.49 15.82
82.15
93.24 17.69 -0.30 2.82 14.87
118.20 114.83 91.58
NAV
12.01 1.17 -0.16 3.58 8.43
-36.98 -16.39 35.16
8.62
2.42
30.32 26.16
2.93 -0.99 -0.02 0.00 2.93
Total Return %
-28.05 14.21
5.21 1.35 3.18
15.97
-20.38 1.56
+/-MSCI Ac Wrld ND +/-S&P US REIT TR USD
-0.87 3.22
0.31 2.61
1.16 4.15
0.02 4.28
0.14 2.52 6.10 1.95 0.96 0.12 2.36 40
0.02 3.02 -0.60 2.77 1.18 0.10 2.53 27
0.06 4.58
3.95
Income Return % Capital Return %
26.86
-40.16 -19.00 31.94
25.61
24.21
25.74
66
55
44
50
30
46
30
29
32
45
Total Rtn % Rank Cat
Pillar Spectrum Positive ∞
2.51 1.58 0.18 4.16
2.81 2.23 0.16 3.47
2.68 1.92 0.14 2.98
2.81 1.60 0.14 2.34
2.73 1.53 0.10 2.62
2.09 0.69 0.11 3.46
2.67 0.00 0.13 4.07
2.28 1.03 0.10 2.44
4.13 0.00 0.10 2.65
0.00 0.00
Income $
§ Negative
¶ Neutral
Capital Gains $ Expense Ratio % Income Ratio % Turnover Rate % Net Assets $mil
. . .
Performance 02-28-15 1st Qtr 2nd Qtr
3rd Qtr
4th Qtr
Total
7
13
17
11
13
10
16
12
10
9
11
2010 2011 2012 2013 2014
10.07 -3.98 13.15 7.44 28.49 6.49 3.58 -14.55 15.24 8.62 10.72 3.73 -0.02 2.49 17.69 8.07 -1.61 -3.00 -0.71 2.42 9.98 7.02 -3.13 14.30 30.32
1,010
1,876
3,047
1,743
1,058
1,371
4,479
5,221
6,917
15,301 14,374 7,571
Portfolio Analysis 01-31-15 Share change since 12-14 Total Stocks:141 Sector
Rating and Risk Time Load-Adj
PE Tot Ret% % Assets
Morningstar
Morningstar Risk vs Cat
Morningstar Risk-Adj Rating
Period Return % Rtn vs Cat
Simon Property Group Inc Public Storage Equity Residential Health Care REIT, Inc.
Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est Real Est
42.9 5.30 8.47
1 Yr 3 Yr 5 Yr
22.61 15.37 17.68
Trailing
Total +/- MSCI
+/- S&P %Rank Growth of
37.6
4.04
.
Return%Ac Wrld ND US REIT TR USD
Cat
$10,000
+Avg +Avg +Avg
High +Avg +Avg
44.8 7.22 3.66
3 Mo 6 Mo 1 Yr
4.91 3.00 10.62 9.66 22.61 15.06 15.37 3.80 17.68 6.97 9.51 3.14
-0.03 -0.06 -0.03 -0.06 -0.03 0.27
43 10,491 45 11,062 49 12,261 16 15,356 16 22,569
54.0 46.7 34.3
3.64 3.54 3.11
. . .
10 Yr Incept
9.51
Ventas Inc
12.09
AvalonBay Communities In
3 Yr Avg 5 Yr Avg 10 Yr Avg 15 Yr Avg
Prologis Inc
34.5 -0.74 3.10
Other Measures
Standard Index
Best Fit Index DJ Real Est
HCP Inc
21.8
2.98
.
MSCI Ac Wrld ND
26 24,805 . . . . . Tax Analysis Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
Boston Properties Inc Vornado Realty Trust Host Hotels & Resorts In General Growth Propertie Essex Property Trust Inc Realty Income Corp SL Green Realty Corp Kimco Realty Corp Digital Realty Trust Inc Federal Realty Investmen American Realty Capital Macerich Co
48.5 6.78 2.91
Alpha
10.0 0.45
0.3
77.5 21.9
2.56 2.38 1.97 1.66
. . . .
Beta
0.98 100
R-Squared
12
74.6 3.13 2.20
3 Yr (estimated) 5 Yr (estimated) 10 Yr (estimated)
13.91 16.29
19 22 16
1.26 1.18 1.26
48 69 31
Standard Deviation
13.55 15.37
122.0
8.0
Mean
48.5 5.72 1.66
8.13
Sharpe Ratio
1.12
58.5
1.65
.
Potential Capital Gain Exposure: 21% of assets
34.1 4.53 1.56 66.7 0.12 1.36
Morningstar’s Take by Robert Goldsborough 03-02-15 Vanguard REIT Index is one of the cheapest ways for investors to gain broad market-capitalization-weighted exposure to REITs. Vanguard’s managers and traders have done a fine job hewing as closely as possible to the benchmark, so this fund’s return has never lagged its index by more than its low 0.10% expense ratio. Real estate is traditionally considered an asset class that can benefit from active management, but this fund has a long track record as a strong performer relative to actively managed funds in the real estate Morningstar Category. Because of its low cost, close tracking, and above-average category performance, we assign it a Morningstar Analyst Rating of Gold. REITs manage commercial properties, rent them out under long-term leases, collect rent, and by law must distribute the majority of their accounting earnings, typically resulting in strong payouts. Traditionally viewed as a liquid way to buy commercial real estate and improve a portfolio’s diversification, the sector’s investor base has expanded in recent years. Thanks to REITs’ relatively higher yields, the asset class now
60.6
1.34
.
attracts income-oriented investors. Despite a commonly held view that active
8.40 1.15
.
Current Investment Style
Industry Weightings
% of Stocks
Rel Cat 1.1 0.9 1.1 1.5 0.9 0.9 1.1 0.0 0.3
management in the real estate sector can outperform by exploiting shifts in industry dynamics or focusing on smaller names, very few actively managed funds have outperformed over time. As a result, this index fund’s performance landed in its category’s first and second quartiles during the past three-, five-, and 10-year periods ending Feb. 19, 2015. This fund tends to be more volatile than the category average, but its risk-adjusted return also has been higher, compensating investors for the additional risk. Higher rates are the REIT sector’s greatest potential headwind. As rates rise, REITs’ interest payments go up, meaning they have less cash flow available for dividends for equity investors. Higher rates mean less business reinvestment. REITs with a lot of debt and higher levels of near-term maturities--which would need to be refinanced--will fare worse than REITs with less debt and long-dated debt maturity schedules.
Market Cap % Giant 0.0 Large 42.6 Mid 37.7 Small 16.6 Micro 3.1 Avg $mil: 10,205
Value Blnd Growth
Large Mid Small
Retail
28.5 18.3 12.1 14.8 11.9
Residential Industrial Healthcare Diversified Hotel/Motel Mgmt & Dev Office
6.8 6.5 0.0 1.1
Value Measures Price/Earnings Price/Book Price/Sales Price/Cash Flow Dividend Yield % Long-Term Erngs Book Value Sales Cash Flow Historical Erngs Growth Measures
Rel Category
Other
42.60 2.47 7.13 17.93 3.76 5.70 -1.24 1.31 5.17 10.34
1.07 1.11 1.20 1.19 1.07 0.89 NMF 0.33 1.12 1.70
Composition - Net
Cash 0.1 Stocks 99.9 Bonds 0.0 Other 0.0 Foreign 0.0
% Rel Category
(% of Stock)
Address:
Vanguard Specialized Funds Valley Forge, PA 19482 800-662-7447 www.vanguard.com
Minimum Purchase: Min Auto Inv Plan:
$10000
Add: $100 IRA: $0
$0
Add: $100
Profitability
% Rel Category
Sales Fees:
No-load 0.08% 3Yr:$32 Quarterly
Return on Equity Return on Assets Net Margin
9.62 3.13 20.05
1.28 1.17 1.04
Web Address: Inception: Advisor: Subadvisor: NTF Plans:
Management Fee:
11-12-01
Actual Fees:
Mgt:0.08% Dist: .
Vanguard Group, Inc.
Expense Projections: Income Distribution:
5Yr:$56 10Yr:$128
None
Vanguard NTF
Mutual Funds ß ®
© 2015Morningstar, Inc.All rights reserved. The information herein isnot representedorwarranted tobe accurate, correct, completeor timely.Pastperformance isnoguaranteeof future results.Accessupdated reports at To order reprints, call 312-696-6100. mfb.morningstar.com.
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