(PUB) Investing 2016

active fund. And there’s no reason not to. Should interest rates continue ris- ing, the active fund may show a slight advantage over time, but if the pace of that rate increase is slow, the index fund may be able to make up the difference with its slightly higher yield, without exhibiting significantly larger capital losses. Again, it’s kind of a toss-up. n tally below) its official one-dollar share price, I’ll be comfortable. If the number expands too far from its base (and I don’t think it will, given Vanguard’s historic aversion to risk) then we’ve got a problem. Finally, for those of you still trying to get some resolution on problems with the consolidation of your fund and brokerage accounts, or bounced checks or misdirected distributions, I heard that Kenneth Agostinelli’s extension was changed after I told you that he in particular was very good at resolv- ing issues for Vanguard shareholders. The Resolution Services department number is (800) 896-7309, and Ken can currently be found at ext. 19767. No doubt Vanguard will play cat-and- mouse with Ken’s extension again, and if it goes dark, the 800 number should still help. n

the end of August, fully 88% of Tax-Exempt Bond Index’s $544 mil- lion in assets are planted in the ETF shares. I should note, by the way, that Tax-Exempt Bond Index remains a tiny fund compared to the $53.1 billion Intermediate-Term Tax-Exempt. As I said, there’s no compelling reason to pick the index fund over the > basis points higher, at 0.66% versus 0.56% for the taxable fund. If you’re a high-tax-bracket investor who’s been looking at the taxable money funds with envy, well, now’s your chance to gloat. That 0.66% tax-exempt yield is roughly equivalent to a taxable yield of 1.2%. You can find all this data on page 9 in the Performance Review . By the way, because of the reforms that have been foisted upon money mar- kets, Vanguard is now calculating net asset values to four decimal points, and you can see that number at vanguard. com. Prime Money Market’s NAV, for example, wasn’t actually $1.00, but ended the month at $1.0002, which is a whole lot better than if it was $0.9998. As long as the money fund’s NAV stays incrementally above (or even incremen- RECORD FROM PAGE 3 >

Analyze This

When I started this newsletter in 1991, I had to thumb through paper SEC filings and copy fund data by hand. But now, thanks to advances in technology and the efforts of our team at InvestorPlace, Jeff and I are able to bring you an unprecedented research tool for Vanguard investors: The Independent Vanguard Fund Analyze r. The Fund Analyzer takes everything you know from our monthly newsletter and annual guide- book to a whole new level. Like our guidebook, it contains comprehensive data on every Vanguard fund we track. And like our newsletter, it’s updated every month. (Some data is even updated daily.) But unlike either, it gives you direct access to a suite of online, interactive charts, tables, and other analytical tools created directly from our in-house database—and it’s designed to work with any computer or mobile device you own. It’s like being right there in our office with us, as your own inde- pendent fund analyst on our research team, with our proprietary risk and return statistics like rolling returns, relative returns, Maximum Cumulative Loss (MCL), and many more at your fingertips. And the best part is, you can get the Fund Analyzer for only $199 a year. For details on how you can try it risk-free for 60 days, visit www.thefundanalyzer.com/JoinNow or call 800/211-7641 and mention code MT9207 .

DO-IT-NOW ACTION RECOMMENDATIONS 4 A large cap-growth fund should drive portfolio returns for years to come. The PRIMECAP Management team is among the best in the business. (See page 1) 4 Health Care has hit a rough patch, but stick with the fund. Portfolio manager Jean Hynes is concentrating on her highest conviction picks. (See page 12) 4 Tax-Exempt Bond Index has held its own in its first year. Buy the ETF shares if you are interested. (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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