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The Independent Adviser for Vanguard Investors
•
February 2016
•
9
FOR CUSTOMER SERVICE, PLEASE CALL
800-211-7641
PERFORMANCE REV I EW
VANGUARD VARIABLE ANNUITIES
Fund (fund #)
Advice
1/29
Price
Jan.
Return
YTD
Return
12-Mo.
Return
3-Year
Return
5-Year
Return Risk
Money Market Annuity (64)
— $1.90
0.0% 0.0% -0.1% -0.2% -0.2% —
Short-Term Inv.-Grade Annuity (144)
Buy
$18.61
0.5% 0.5% 0.6% 1.2% 1.8% 0.39
Total Bond Market Annuity (67)
Hold
$37.34
1.3% 1.3% -0.8% 1.6% 3.0% 0.99
High-Yield Bond Annuity (146)
Buy
$28.55
-1.1% -1.1% -3.5% 1.5% 4.6% 1.64
Conservative Allocation Annuity (801)
Hold
$25.41
-1.4% -1.4% -2.0% 4.0% — 0.42
Moderate Allocation Annuity (803)
Hold
$27.01
-2.8% -2.8% -3.0% 4.9% — 0.60
Balanced Annuity (69)
Buy
$80.09
-2.8% -2.8% -1.6% 7.1% 7.6% 0.65
Capital Growth Annuity (603)
Buy
$37.30
-6.3% -6.3% -2.5% 13.6% 11.6% 1.02
Diversified Value Annuity (145)
Buy
$26.84
-4.3% -4.3% -3.4% 7.9% 9.0% 0.97
Equity Income Annuity (8)
Buy
$68.45
-3.3% -3.3% 0.4% 10.0% 11.3% 0.93
Equity Index Annuity (68)
Buy
$76.38
-5.0% -5.0% -1.0% 10.8% 10.4% 1.00
Growth Annuity (10)
Hold
$39.79
-6.4% -6.4% 2.2% 13.6% 12.0% 1.14
MidCap Index Annuity (143)
Buy
$42.81
-7.4% -7.4% -7.2% 9.1% 8.9% 1.07
REIT Index Annuity (147)
Hold
$52.66
-3.4% -3.4% -7.7% 7.9% 9.8% 1.28
Small Company Growth Annuity (160)
Hold
$56.53
-10.4% -10.4% -10.4% 7.2% 8.5% 1.40
Total Stock Market Annuity (604)
Hold
$27.53
-5.7% -5.7% -2.9% 10.0% 9.9% 1.02
International Annuity (86)
Buy
$33.79
-8.0% -8.0% -9.0% 0.1% 1.6% 1.24
Our ratings:
BUY: Best choice. Generally funds held in our
Model Portfolios or funds with similar objectives. HOLD:
Current prospects for the fund are not as good as those with
a Buy rating. However, investors who own shares in the fund
may wish to assess tax costs of trading into a Buy-rated fund.
SELL: The fund’s long-term prospects are not as compelling as
other funds’, or other factors may make the fund unattractive
compared to alternatives. “+” is a rating upgrade over the
previous month; “-” is a downgrade.
Investors should weigh all tax implications of fund switches
before making a sale or purchase. Some closed funds are
available for purchase by high-net-worth investors. All funds
charge a $20 annual account fee unless you have $10,000 in
the fund, $100,000 with Vanguard or accept all paperwork
through online means.
Minimum
refers to the dollar amount (e.g., $3K means
$3,000) needed to open a new taxable account.
Loads
are
denoted with an “f” for front-end and “r” for back-end.
Holding periods are noted for loads imposed on sales of
shares held less than two months (<2 mo.) or one year (<1).
3-year
and
5-year returns
are compound, annualized
returns.
Average maturity
is in years for bond funds and
days for money market funds.
12-month yields
are based
on trailing 12-month dividend/income distributions.
SEC
yields
are reported 30-day yields.
Taxable equivalent
yields
are based on SEC yields. For state funds, taxable
equivalent yields incorporate state taxes.
Risk
is fund vola-
tility measured over the previous 24 months. Equity fund risk
is measured against the S&P 500 index. Bond fund risk is
measured against the Barclays Aggregate Bond index.
Annuity ratings
May differ from taxable funds since choices
in the annuity area are more limited.
* Tax equivalent yields incorporate the 3.8% health care sur-
tax into the 33%, 35% and 39.6% tax rates.
** Fund sold with a 0.75% front-end load
*** Fund sold with a 0.25% front-end load
VANGUARD INCOME FUNDS
Fund (fund #)
Ticker Advice
Avg.
Mat.
1/29
Price
Jan.
Return
YTD
Return
12-Mo.
Return
3-Year
Return
5-Year
Return
12-Mo.
Yield
SEC
Yield
—— Tax Equivalent Yield ——
Risk
25% 28% 36.8%
*
38.8%
*
43.4%
*
TAXABLE INCOME
Ultra-Short-Term Bond (1492)
VUBFX
Buy 1.1 $9.99
0.3% 0.3% — — — — 0.83% — — — — — —
Short-Term Treasury (32)
VFISX
Sell
2.5 $10.73
0.8% 0.8% 0.7% 0.7% 0.9% 0.7% 0.82% — — — — — 0.36
Short-Term Federal (49)
VSGBX
Sell
2.7 $10.79
0.8% 0.8% 0.9% 0.8% 1.3% 0.9% 0.96% — — — — — 0.35
Short-Term Inflation Index (1967)
VTIPX
Hold 2.4 $24.27
0.5% 0.5% -0.6% -1.0% — 0.0% 0.13% — — — — — 0.61
Short-Term Investment-Grade (39)
VFSTX
Buy 3.3 $10.60
0.5% 0.5% 0.8% 1.4% 2.0% 2.0% 2.01% — — — — — 0.38
Short-Term Bond Index (132)
VBISX
Hold 2.8 $10.51
0.9% 0.9% 0.7% 1.0% 1.5% 1.2% 1.33% — — — — — 0.47
Inflation-Protected Sec. (119)
VIPSX
Hold 8.5 $13.04
1.6% 1.6% -3.3% -1.7% 2.7% 0.8% 0.36% — — — — — 1.47
Intermed. Treasury (35)
VFITX
Sell
5.7 $11.51
2.4% 2.4% 1.2% 1.9% 3.4% 1.6% 1.42% — — — — — 1.22
Intermed. Investment-Grade (71)
VFICX
Buy 6.4 $9.72
1.1% 1.1% 0.0% 2.5% 4.5% 3.0% 2.77% — — — — — 1.03
Intermed.-Term Bond Index (314)
VBIIX
Hold 7.2 $11.45
1.9% 1.9% -0.1% 2.4% 4.6% 2.6% 2.54% — — — — — 1.37
Total Bond Market (84)
VBMFX Hold 8.0 $10.77
1.4% 1.4% -0.6% 1.9% 3.3% 2.4% 2.24% — — — — — 1.00
GNMA (36)
VFIIX
Hold 6.4 $10.77
1.2% 1.2% 1.8% 2.5% 3.3% 2.3% 2.34% — — — — — 0.68
Long-Term Treasury (83)
VUSTX
Sell
25.0 $12.80
5.2% 5.2% -4.9% 5.3% 9.1% 2.7% 2.50% — — — — — 3.88
Long-Term Investment-Grade (28)
VWESX Hold 23.4 $10.00
1.4% 1.4% -6.3% 3.8% 8.0% 4.4% 4.13% — — — — — 2.67
Long-Term Bond Index (522)
VBLTX
Sell
24.1 $13.46
2.3% 2.3% -7.4% 3.3% 7.7% 4.0% 3.97% — — — — — 2.94
High-Yield Corporate (29)
VWEHX Buy 6.4 $5.46 -1.0% -1.0% -3.0% 2.0% 5.1% 6.0% 6.50% — — — — — 1.69
Emerging Mkts. Gov’t Bond Idx. (1120)** VGOVX
Buy 10.0 $9.23 -0.1% -0.1% 0.8% — — 4.9% 5.11% — — — — — 1.88
Total International Bond Index (1231)
VTIBX
Hold 8.9 $10.71
1.6% 1.6% 0.8% — — 1.7% 0.88% — — — — — 0.97
MONEY MARKET
Treasury MM (11)
VUSXX
— 49 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.18% — — — — — —
Federal MM (33)
VMFXX
— 50 $1.00
0.0% 0.0% 0.1% 0.0% 0.0% 0.0% 0.27% — — — — — —
Prime MM (30)
VMMXX — 57 $1.00
0.0% 0.0% 0.1% 0.0% 0.0% 0.1% 0.36% — — — — — —
Tax-Exempt Money Market (45)
VMSXX
— 39 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
CA Tax-Exempt MM (62)
VCTXX
— 31 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
NJ Tax-Exempt MM (95)
VNJXX
45 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
NY Tax-Exempt MM (163)
VYFXX
— 29 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
OH Tax-Exempt MM (96)
VOHXX
— 40 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
PA Tax-Exempt MM (63)
VPTXX
— 22 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.01% 0.0% 0.0% 0.0% 0.0% 0.0% —
TAX-FREE INCOME
Short-Term Tax-Exempt (41)
VWSTX Buy 1.5 $15.83
0.3% 0.3% 0.5% 0.6% 0.9% 0.7% 0.52% 0.7% 0.7% 0.8% 0.8% 0.9% 0.12
Limited-Term Tax-Exempt (31)
VMLTX
Buy 3.0 $11.08
0.7% 0.7% 1.1% 1.4% 2.0% 1.5% 0.85% 1.1% 1.2% 1.3% 1.4% 1.5% 0.40
Intermed.-Term Tax-Exempt (42)
VWITX
Buy 5.2 $14.40
1.2% 1.2% 2.6% 3.1% 5.1% 2.8% 1.47% 2.0% 2.0% 2.3% 2.4% 2.6% 0.73
Tax-Exempt Bond Index (1491)***
VTEBX Hold 5.6 $10.26
1.1% 1.1% — — — — 1.54% 2.1% 2.1% 2.4% 2.5% 2.7% —
Long-Term Tax-Exempt (43)
VWLTX Hold 6.2 $11.86
1.2% 1.2% 3.3% 4.1% 6.5% 3.6% 2.05% 2.7% 2.8% 3.2% 3.3% 3.6% 0.91
High-Yield Tax-Exempt (44)
VWAHX Hold 6.6 $11.41
1.1% 1.1% 3.2% 4.2% 6.9% 3.6% 2.49% 3.3% 3.5% 3.9% 4.1% 4.4% 0.90
STATETAX-FREE
CA Intermed. Tax-Exempt (100)
VCAIX
Buy 5.3 $11.97
1.2% 1.2% 2.8% 3.6% 5.8% 2.7% 1.39% 2.1% 2.2% 2.5% 2.5% 2.7% 0.74
CA Long-T. Tax-Exempt (75)
VCITX
Sell
6.4 $12.32
1.2% 1.2% 3.5% 4.5% 7.2% 3.5% 1.88% 2.8% 2.9% 3.3% 3.4% 3.7% 0.91
MA Tax-Exempt (168)
VMATX Sell
6.3 $11.02
1.2% 1.2% 3.0% 3.7% 5.8% 3.0% 1.85% 2.6% 2.7% 3.1% 3.2% 3.5% 0.94
NJ Long-T. Tax-Exempt (14)
VNJTX
Sell
6.3 $12.22
1.3% 1.3% 2.1% 3.5% 5.8% 3.5% 2.51% 3.7% 3.8% 4.4% 4.5% 4.9% 1.03
NY Long-T. Tax-Exempt (76)
VNYTX
Sell
6.0 $12.02
1.2% 1.2% 3.5% 4.1% 6.0% 3.2% 1.80% 2.6% 2.7% 3.1% 3.2% 3.5% 0.85
OH Long-T. Tax-Exempt (97)
VOHIX
Sell
6.1 $12.77
1.2% 1.2% 3.4% 4.2% 6.4% 3.3% 2.07% 3.0% 3.1% 3.5% 3.6% 3.9% 0.91
PA Long-T. Tax-Exempt (77)
VPAIX
Sell
5.6 $11.80
1.1% 1.1% 3.1% 4.1% 6.1% 3.6% 2.14% 2.9% 3.1% 3.5% 3.6% 3.9% 0.84