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The Independent Adviser for Vanguard Investors
•
April 2016
•
9
FOR CUSTOMER SERVICE, PLEASE CALL
800-211-7641
PERFORMANCE REV I EW
VANGUARD VARIABLE ANNUITIES
Fund (fund #)
Advice
3/31
Price
March
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
$18.82
1.1% 1.7% 1.5% 1.4% 2.0% 0.44
Total Bond Market Annuity (67)
Hold
$37.95
1.0% 3.0% 1.5% 2.0% 3.3% 1.00
High-Yield Bond Annuity (146)
Buy
$29.55
3.0% 2.4% -1.5% 2.3% 5.0% 1.73
Conservative Allocation Annuity (801)
Hold
$26.33
3.5% 2.2% 0.1% 4.7% — 0.43
Moderate Allocation Annuity (803)
Hold
$28.26
4.8% 1.7% -0.9% 5.7% — 0.61
Balanced Annuity (69)
Buy
$83.90
5.1% 1.8% 0.9% 7.5% 8.2% 0.67
Capital Growth Annuity (603)
Buy
$39.12
6.1% -1.7% -1.4% 12.9% 12.2% 0.98
Diversified Value Annuity (145)
Buy
$28.18
5.8% 0.5% -1.8% 7.8% 9.3% 0.95
Equity Income Annuity (8)
Buy
$73.02
6.6% 3.2% 4.0% 10.4% 11.8% 0.93
Equity Index Annuity (68)
Buy
$81.40
6.8% 1.3% 1.4% 11.3% 11.1% 1.00
Growth Annuity (10)
Hold
$41.06
4.6% -3.5% -0.4% 13.3% 12.0% 1.04
MidCap Index Annuity (143)
Buy
$46.75
8.0% 1.1% -4.6% 10.3% 9.6% 1.07
REIT Index Annuity (147)
Hold
$57.86
10.4% 6.2% 3.5% 9.9% 11.2% 1.33
Small Company Growth Annuity (160)
Hold
$61.58
8.4% -2.3% -9.8% 8.3% 8.5% 1.40
Total Stock Market Annuity (604)
Hold
$29.44
7.0% 0.8% -0.8% 10.6% 10.5% 1.02
International Annuity (86)
Buy
$35.84
7.9% -2.4% -8.3% 2.6% 2.2% 1.25
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.
3/31
Price
March
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 $10.00
0.2% 0.5% 0.6% — — 0.6% 0.91% — — — — — —
Short-Term Treasury (32)
VFISX
Sell
2.4 $10.76
0.3% 1.2% 1.2% 0.7% 1.1% 0.7% 0.70% — — — — — 0.35
Short-Term Federal (49)
VSGBX
Sell
3.0 $10.82
0.3% 1.3% 1.4% 0.9% 1.4% 0.9% 0.97% — — — — — 0.34
Short-Term Inflation Index (1967)
VTIPX
Hold 2.6 $24.57
1.0% 1.8% 1.2% -0.6% — 0.0% -0.65% — — — — — 0.65
Short-Term Investment-Grade (39)
VFSTX
Buy 3.4 $10.69
1.0% 1.7% 1.8% 1.7% 2.3% 2.0% 1.97% — — — — — 0.43
Short-Term Bond Index (132)
VBISX
Hold 2.8 $10.56
0.5% 1.6% 1.4% 1.2% 1.7% 1.3% 1.25% — — — — — 0.46
Inflation-Protected Sec. (119)
VIPSX
Hold 8.7 $13.43
1.9% 4.6% 1.4% -0.9% 2.9% 0.7% -0.01% — — — — — 1.53
Intermed. Treasury (35)
VFITX
Sell
5.8 $11.59
0.2% 3.4% 3.1% 1.9% 3.7% 1.6% 1.27% — — — — — 1.19
Intermed. Investment-Grade (71)
VFICX
Buy 6.5 $9.91
1.8% 3.5% 2.8% 3.0% 5.0% 3.0% 2.61% — — — — — 1.08
Intermed.-Term Bond Index (314)
VBIIX
Hold 7.2 $11.64
1.1% 4.0% 2.8% 2.7% 5.1% 2.6% 2.30% — — — — — 1.36
Total Bond Market (84)
VBMFX Hold 7.9 $10.90
0.9% 3.1% 1.7% 2.3% 3.6% 2.3% 2.13% — — — — — 1.00
Core Bond (1320)
VCORX
Buy 6.5 $10.04
— — — — — — 0.00% — — — — — —
GNMA (36)
VFIIX
Hold 6.0 $10.79
0.3% 1.9% 2.2% 2.5% 3.4% 2.3% 2.46% — — — — — 0.66
Long-Term Treasury (83)
VUSTX
Sell
25.3 $13.11
0.1% 8.3% 2.6% 5.8% 9.5% 2.6% 2.33% — — — — — 3.84
Long-Term Investment-Grade (28)
VWESX Hold 23.1 $10.43
3.8% 6.8% 1.3% 5.3% 8.7% 4.2% 3.88% — — — — — 2.81
Long-Term Bond Index (522)
VBLTX
Sell
24.2 $14.04
3.0% 7.4% 0.3% 4.7% 8.4% 3.9% 3.70% — — — — — 2.97
High-Yield Corporate (29)
VWEHX Buy 6.4 $5.59
2.9% 2.3% -1.1% 2.7% 5.5% 5.7% 5.56% — — — — — 1.81
Emerging Mkts. Gov’t Bond Idx. (1120)** VGOVX
Buy 10.0 $9.59
3.0% 4.6% 3.6% — — 4.6% 4.52% — — — — — 1.87
Emerging Markets Bond (1431)
VEMBX
— 9.5 $10.17
— — — — — — 0.00% — — — — — —
Total International Bond Index (1231)
VTIBX
Hold 9.1 $10.88
0.7% 3.4% 2.3% — — 1.5% 0.69% — — — — — 1.01
MONEY MARKET
Treasury MM (11)
VUSXX
— 58 $1.00
0.0% 0.1% 0.1% 0.0% 0.0% 0.1% 0.27% — — — — — —
Federal MM (33)
VMFXX
— 53 $1.00
0.0% 0.1% 0.1% 0.0% 0.0% 0.1% 0.30% — — — — — —
Prime MM (30)
VMMXX — 54 $1.00
0.0% 0.1% 0.1% 0.1% 0.0% 0.1% 0.42% — — — — — —
Tax-Exempt Money Market (45)
VMSXX
— 30 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.20% 0.3% 0.3% 0.3% 0.3% 0.4% —
CA Tax-Exempt MM (62)
VCTXX
— 21 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.15% 0.2% 0.2% 0.3% 0.3% 0.3% —
NJ Tax-Exempt MM (95)
VNJXX
— 39 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.16% 0.2% 0.2% 0.3% 0.3% 0.3% —
NY Tax-Exempt MM (163)
VYFXX
— 25 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.18% 0.3% 0.3% 0.3% 0.3% 0.3% —
OH Tax-Exempt MM (96)
VOHXX
— 43 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.19% 0.3% 0.3% 0.3% 0.3% 0.4% —
PA Tax-Exempt MM (63)
VPTXX
— 18 $1.00
0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.16% 0.2% 0.2% 0.3% 0.3% 0.3% —
TAX-FREE INCOME
Short-Term Tax-Exempt (41)
VWSTX Buy 1.5 $15.82 -0.1% 0.3% 0.7% 0.5% 0.8% 0.7% 0.54% 0.7% 0.8% 0.9% 0.9% 1.0% 0.11
Limited-Term Tax-Exempt (31)
VMLTX
Buy 3.0 $11.05 -0.2% 0.6% 1.6% 1.3% 1.9% 1.5% 0.86% 1.1% 1.2% 1.4% 1.4% 1.5% 0.36
Intermed.-Term Tax-Exempt (42)
VWITX
Buy 5.2 $14.39
0.3% 1.6% 3.7% 3.2% 4.9% 2.8% 1.47% 2.0% 2.0% 2.3% 2.4% 2.6% 0.70
Tax-Exempt Bond Index (1491)***
VTEBX Hold 5.5 $10.27
0.3% 1.5% — — — — 1.55% 2.1% 2.2% 2.5% 2.5% 2.7% 0.78
Long-Term Tax-Exempt (43)
VWLTX Hold 6.3 $11.87
0.7% 1.9% 4.8% 4.4% 6.4% 3.6% 2.05% 2.7% 2.8% 3.2% 3.3% 3.6% 0.89
High-Yield Tax-Exempt (44)
VWAHX Hold 6.9 $11.43
0.7% 1.9% 4.8% 4.4% 6.8% 3.6% 2.54% 3.4% 3.5% 4.0% 4.2% 4.5% 0.87
STATETAX-FREE
CA Intermed. Tax-Exempt (100)
VCAIX
Buy 5.3 $11.97
0.3% 1.7% 4.1% 3.7% 5.5% 2.7% 1.36% 2.0% 2.1% 2.4% 2.5% 2.7% 0.72
CA Long-T. Tax-Exempt (75)
VCITX
Sell
6.4 $12.34
0.7% 1.9% 5.0% 4.8% 7.1% 3.4% 1.86% 2.8% 2.9% 3.3% 3.4% 3.7% 0.89
MA Tax-Exempt (168)
VMATX Sell
6.1 $11.03
0.6% 1.8% 4.5% 4.1% 5.6% 3.0% 1.84% 2.6% 2.7% 3.1% 3.2% 3.4% 0.92
NJ Long-T. Tax-Exempt (14)
VNJTX
Sell
6.2 $12.22
0.5% 1.9% 4.0% 3.8% 5.8% 3.5% 2.50% 3.7% 3.8% 4.3% 4.5% 4.9% 1.01
NY Long-T. Tax-Exempt (76)
VNYTX
Sell
6.0 $12.03
0.6% 1.8% 4.9% 4.4% 6.0% 3.2% 1.80% 2.6% 2.7% 3.1% 3.2% 3.5% 0.84
OH Long-T. Tax-Exempt (97)
VOHIX
Sell
6.2 $12.78
0.7% 1.8% 4.9% 4.5% 6.3% 3.3% 2.04% 2.9% 3.0% 3.5% 3.6% 3.9% 0.90
PA Long-T. Tax-Exempt (77)
VPAIX
Sell
5.5 $11.79
0.6% 1.6% 4.4% 4.3% 6.0% 3.5% 2.14% 2.9% 3.1% 3.5% 3.6% 3.9% 0.83