(PUB) Investing 2016

1.8%; World ex-U.S. SmallCap Index is off 4.2%; and Total Stock Market Index is down 0.8%. As with any envi- ronment, there will be winners and losers, but the disparity between the two may grow as this drama continues to unravel. This is the type of environ- ment where highly skilled managers, like those running International Growth, can find good companies that have been indiscriminately sold by investors rush- ing for the exits. Finally, take a step away from the headlines and consider the big pic- ture, shown in the chart on page 14: If you’ve been an investor for the past two decades, the MSCI EAFE index has more than doubled during your invest- ment career. Over the past 30 years, the EAFE has gone up sixfold. It is up 35 times its starting value over the past 40 years. Now, consider all of the shocks, surprises, scares and uncertainties that have occurred in your life. I’ve said it before, and I’ll say it again: It is time in the markets that builds wealth, not market timing. Next month, we’ll have a conversa- tion about Vanguard’s array of foreign funds. In the meantime, stick with me and with the managers at International Growth, and we’ll be just fine. n

how global trade and commerce function today or tomorrow, as the U.K. is still part of the E.U.—its withdrawal will take time. Once the U.K. elects a new prime minister (current PM David Cameron has said he will resign) in late 2016, they will need to invoke Article 50 of the Lisbon Treaty, which gives the country two years to negotiate a new agreement with the E.U. That said, for U.S. investors and our economy, the immediate impact should be negligible. U.S. exports to the U.K. only represent 0.7% of U.S. GDP, and just 3% of revenues for all 500 com- panies in the S&P index comes from the U.K. The largest unknown is what this means for the long-term viability of the E.U. The populist and national- ist sentiment behind the vote to leave the E.U. is in no way a U.K.-only phe- nomenon. Those undercurrents can be seen across Europe, and even at home here in the U.S. How this plays out over the coming years will be some- thing to watch. One thing we do know today is that for U.S. investors, the stocks in European Index are 7.1% cheaper than they were a week ago. And the “sale” sign hasn’t only been hung out in Europe. Over the past week, Pacific Index has declined >

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DO-IT-NOW ACTION RECOMMENDATIONS 4 The turmoil in foreign markets is creating opportunities. If you don’t have a position in for- eign stocks, International Growth is the fund to buy. (See page 1) 4 When you read that Vanguard returns all its profits to fund shareholders, remember that millions of dollars are actually going to its senior executives. (See page 7) 4 One-third of Explorer Value ’s three-adviser portfolio team was shown the exit. I still wouldn’t rush to buy the fund, though. (See page 15)

Daniel P. Wiener is America’s leading expert on the Vanguard family of funds. He is founder of the Fund Family Shareholder Association and chairman and chief executive officer of Adviser Investments, LLC, a Newton, Massachusetts, investment advisory firm (800-492-6868). As

Jeffrey D. DeMaso, Editor/Director of Research, works directly with Dan Wiener researching and writing the multiple-award winning Independent Adviser for Vanguard Investors newsletter. He also leads the analyst team for Adviser Investments, LLC. Jeff gradu-

editor of The Independent Adviser for Vanguard Investors , he is a five-time recipient of the Newsletter Publishers Foundation’s Editorial Excellence Award. He also edits the annual Independent Guide to the Vanguard Funds. Mr. Wiener is often quoted in the nation’s leading financial publications.

ated magna cum laude from Tufts University with a B.A. in economics, holds the Chartered Financial Analyst designation and is a member of the CFA Institute and the Boston Security Analysts Society.

16 • Fund Family Shareholder Association

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