UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT
OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-02968-99
Name of Registrant: | Vanguard Trustees’ Equity Fund |
Address of Registrant: | P.O. Box 2600 |
Valley Forge, PA 19482 |
Name and address of agent for service: | Anne E. Robinson, Esquire |
P.O. Box 876 | |
Valley Forge, PA 19482 |
Registrant’s telephone number, including area code: (610) 669-1000
Date of fiscal year end: October 31
Date of reporting period: November 1, 2022—October 31, 2023
Item 1: Reports to Shareholders
1 | |
2 | |
6 | |
8 | |
10 |
• | For the 12 months ended October 31, 2023, Vanguard International Value Fund returned 13.97%, outperforming the 12.07% return of its benchmark, the MSCI All Country World Index ex USA. |
• | Early on, inflation in many developed markets eased off multidecade highs amid ongoing interest rate hikes by central banks. Unexpected resilience in labor markets and consumer spending helped dial back expectations of a sustained global recession, but the prospect of higher interest rates for longer and heightened geopolitical tensions weighed on market sentiment toward the close of the period. |
• | Eight of the fund’s 11 sectors posted double-digit returns. Overall, the advisors’ selections in materials and energy helped performance relative to the benchmark. Selections in industrials and consumer staples detracted. |
• | Returns were positive across all regions and were strongest in Europe, which represents nearly half of the fund’s holdings. Pacific stocks helped relative performance primarily through security selection in South Korea and Hong Kong. Emerging market stocks detracted. |
• | For the 10 years ended October 31, the fund’s average annual return was 2.74%, outpacing the 2.54% return of its benchmark. |
Average Annual Total Returns Periods Ended October 31, 2023 | |||
One Year | Three Years | Five Years | |
Stocks | |||
Russell 1000 Index (Large-caps) | 9.48% | 9.53% | 10.71% |
Russell 2000 Index (Small-caps) | -8.56 | 3.95 | 3.31 |
Russell 3000 Index (Broad U.S. market) | 8.38 | 9.19 | 10.23 |
FTSE All-World ex US Index (International) | 12.35 | 3.51 | 3.88 |
Bonds | |||
Bloomberg U.S. Aggregate Float Adjusted Index (Broad taxable market) | 0.53% | -5.51% | 0.03% |
Bloomberg Municipal Bond Index (Broad tax-exempt market) | 2.64 | -2.48 | 1.00 |
FTSE Three-Month U.S. Treasury Bill Index | 4.94 | 1.93 | 1.80 |
CPI | |||
Consumer Price Index | 3.24% | 5.72% | 4.00% |
Chief Investment Officer
Fund Assets Managed | |||
Investment Advisor | % | $ Million | Investment Strategy |
Lazard Asset Management LLC | 40 | 4,940 | The advisor uses a research-driven, bottom-up, relative-value approach in selecting stocks. The goal is to identify individual stocks that offer an appropriate trade-off between low relative valuation and high financial productivity. |
Sprucegrove Investment Management Ltd. | 34 | 4,226 | The advisor employs a concentrated, low-turnover, value-oriented investment approach that results in a portfolio of companies with good long-term prospects and below-market price/earnings ratios. In-depth fundamental research on industries and companies is central to this investment process. |
ARGA Investment Management, LP | 25 | 3,092 | The advisor invests in deeply undervalued securities with long-term upside. Its valuation discipline is based on fundamental research and present value, with full integration of ESG risks and opportunities. |
Cash Investments | 1 | 164 | These short-term reserves are invested by Vanguard in equity index products to simulate investments in stocks. Each advisor may also maintain a modest cash position. |
• | Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund’s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. |
• | Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds. |
Six Months Ended October 31, 2023 | |||
International Value Fund | Beginning Account Value 4/30/2023 | Ending Account Value 10/31/2023 | Expenses Paid During Period |
Based on Actual Fund Return | $1,000.00 | $928.60 | $1.90 |
Based on Hypothetical 5% Yearly Return | 1,000.00 | 1,023.24 | 1.99 |
Average Annual Total Returns Periods Ended October 31, 2023 | |||||
One Year | Five Years | Ten Years | Final Value of a $10,000 Investment | ||
International Value Fund | 13.97% | 4.00% | 2.74% | $13,098 | |
MSCI All Country World Index ex USA | 12.07 | 3.46 | 2.54 | 12,854 |
United Kingdom | 14.9% |
Japan | 11.1 |
France | 8.8 |
Germany | 7.5 |
China | 6.9 |
Switzerland | 6.3 |
Netherlands | 6.1 |
Hong Kong | 5.3 |
Brazil | 3.7 |
India | 3.3 |
Canada | 3.2 |
United States | 2.9 |
Ireland | 2.6 |
South Korea | 2.4 |
Taiwan | 2.2 |
Singapore | 2.0 |
Indonesia | 1.9 |
Denmark | 1.7 |
Finland | 1.3 |
Other | 5.9 |
Shares | Market Value• ($000) | |||||
Common Stocks (92.8%) | ||||||
Australia (0.6%) | ||||||
National Australia Bank Ltd. | 2,029,400 | 36,355 | ||||
QBE Insurance Group Ltd. | 1,765,216 | 17,504 | ||||
* | Adbri Ltd. | 13,390,194 | 16,822 | |||
70,681 | ||||||
Belgium (0.4%) | ||||||
KBC Group NV | 846,711 | 46,599 | ||||
Brazil (1.9%) | ||||||
Banco Bradesco SA ADR | 38,829,974 | 108,336 | ||||
Ambev SA ADR | 26,553,800 | 67,181 | ||||
Banco do Brasil SA | 3,133,800 | 30,053 | ||||
JBS SA | 3,454,000 | 13,722 | ||||
Petroleo Brasileiro SA ADR | 757,150 | 11,357 | ||||
230,649 | ||||||
Canada (3.0%) | ||||||
Suncor Energy Inc. | 4,169,426 | 135,027 | ||||
Nutrien Ltd. | 1,081,610 | 58,091 | ||||
Stella-Jones Inc. | 815,400 | 42,712 | ||||
Great-West Lifeco Inc. | 1,442,415 | 39,962 | ||||
Saputo Inc. | 1,666,949 | 33,658 | ||||
North West Co. Inc. | 1,135,211 | 28,946 | ||||
Alimentation Couche-Tard Inc. | 470,100 | 25,591 | ||||
Toronto-Dominion Bank | 263,900 | 14,736 | ||||
378,723 | ||||||
China (6.6%) | ||||||
* | Alibaba Group Holding Ltd. | 25,799,900 | 265,612 | |||
Tencent Holdings Ltd. | 5,091,300 | 188,423 | ||||
Ping An Insurance Group Co. of China Ltd. Class H | 12,665,500 | 64,245 | ||||
ENN Energy Holdings Ltd. | 7,549,400 | 57,188 | ||||
Sungrow Power Supply Co. Ltd. Class A | 3,593,953 | 41,415 | ||||
Li Ning Co. Ltd. | 12,537,500 | 38,420 |
Shares | Market Value• ($000) | |||||
Autohome Inc. ADR | 1,112,003 | 29,746 | ||||
* | Alibaba Group Holding Ltd. ADR | 334,409 | 27,601 | |||
Shandong Weigao Group Medical Polymer Co. Ltd. Class H | 25,992,000 | 24,126 | ||||
Hengan International Group Co. Ltd. | 7,179,500 | 24,046 | ||||
Wuxi Lead Intelligent Equipment Co. Ltd. Class A | 5,994,938 | 22,984 | ||||
* | Trip.com Group Ltd. ADR | 603,258 | 20,511 | |||
Weibo Corp. ADR | 1,156,924 | 13,686 | ||||
818,003 | ||||||
Denmark (1.6%) | ||||||
Novo Nordisk A/S Class B | 1,526,838 | 147,303 | ||||
Carlsberg A/S Class B | 449,863 | 53,612 | ||||
200,915 | ||||||
Egypt (0.2%) | ||||||
Commercial International Bank Egypt SAE (Registered) GDR | 24,883,498 | 28,320 | ||||
Finland (1.3%) | ||||||
Nokia OYJ | 20,115,499 | 66,999 | ||||
Sampo OYJ Class A | 1,571,237 | 61,795 | ||||
Nokian Renkaat OYJ | 3,679,749 | 27,828 | ||||
156,622 | ||||||
France (8.4%) | ||||||
Airbus SE | 1,443,615 | 193,554 | ||||
Air Liquide SA | 851,695 | 145,940 | ||||
Engie SA | 8,409,958 | 133,759 | ||||
Thales SA | 567,781 | 83,792 | ||||
Pernod Ricard SA | 398,313 | 70,731 | ||||
Bureau Veritas SA | 2,962,936 | 67,489 | ||||
TotalEnergies SE | 1,006,606 | 67,299 | ||||
Legrand SA | 672,121 | 58,143 | ||||
Kering SA | 142,136 | 57,807 | ||||
Accor SA | 1,633,993 | 52,129 | ||||
Capgemini SE | 290,764 | 51,386 |
Shares | Market Value• ($000) | |||||
Bouygues SA | 952,603 | 33,512 | ||||
ArcelorMittal SA | 1,204,465 | 26,652 | ||||
1,042,193 | ||||||
Germany (5.9%) | ||||||
BASF SE | 2,551,424 | 117,894 | ||||
SAP SE | 857,153 | 114,972 | ||||
Fresenius Medical Care AG & Co. KGaA | 1,937,870 | 64,388 | ||||
Continental AG | 959,511 | 62,646 | ||||
Merck KGaA | 388,917 | 58,741 | ||||
Henkel AG & Co. KGaA | 804,040 | 50,816 | ||||
1 | Siemens Healthineers AG | 1,029,148 | 50,631 | |||
Bayerische Motoren Werke AG | 533,870 | 49,652 | ||||
*,1 | Covestro AG | 832,771 | 42,190 | |||
Infineon Technologies AG | 1,365,548 | 39,888 | ||||
MTU Aero Engines AG | 152,798 | 28,719 | ||||
Fresenius SE & Co. KGaA | 1,071,944 | 27,574 | ||||
FUCHS SE | 606,100 | 20,355 | ||||
728,466 | ||||||
Hong Kong (5.1%) | ||||||
AIA Group Ltd. | 20,426,200 | 177,377 | ||||
* | Sands China Ltd. | 44,212,800 | 119,023 | |||
* | Melco Resorts & Entertainment Ltd. ADR | 8,831,144 | 74,535 | |||
Jardine Matheson Holdings Ltd. | 1,058,200 | 42,880 | ||||
Galaxy Entertainment Group Ltd. | 7,365,000 | 41,402 | ||||
Xinyi Glass Holdings Ltd. | 26,092,557 | 29,981 | ||||
Techtronic Industries Co. Ltd. | 3,135,000 | 28,621 | ||||
1 | ESR Group Ltd. | 18,994,000 | 24,405 | |||
Sun Hung Kai Properties Ltd. | 2,353,500 | 24,167 | ||||
1 | WH Group Ltd. | 38,320,243 | 22,886 | |||
CK Asset Holdings Ltd. | 3,309,500 | 16,542 | ||||
Yue Yuen Industrial Holdings Ltd. | 12,157,000 | 14,214 | ||||
Hongkong Land Holdings Ltd. | 4,386,600 | 13,913 | ||||
629,946 | ||||||
India (3.2%) | ||||||
ICICI Bank Ltd. ADR | 4,855,982 | 107,754 | ||||
Adani Ports & Special Economic Zone Ltd. | 9,407,767 | 88,751 | ||||
HDFC Bank Ltd. | 4,340,972 | 77,029 | ||||
* | Zee Entertainment Enterprises Ltd. | 23,967,023 | 74,623 | |||
UPL Ltd. | 7,530,784 | 48,897 | ||||
397,054 | ||||||
Indonesia (1.8%) | ||||||
Bank Mandiri Persero Tbk. PT | 219,186,600 | 78,305 |
Shares | Market Value• ($000) | |||||
Astra International Tbk. PT | 202,829,700 | 73,785 | ||||
Telkom Indonesia Persero Tbk. PT ADR | 1,567,073 | 34,476 | ||||
Selamat Sempurna Tbk. PT | 164,317,700 | 22,437 | ||||
Telkom Indonesia Persero Tbk. PT | 69,300,200 | 15,192 | ||||
224,195 | ||||||
Ireland (2.5%) | ||||||
* | Ryanair Holdings plc ADR | 1,751,871 | 153,639 | |||
CRH plc | 1,444,361 | 77,514 | ||||
* | ICON plc | 304,712 | 74,338 | |||
305,491 | ||||||
Italy (0.4%) | ||||||
* | Brembo SpA | 4,410,073 | 47,451 | |||
Japan (10.7%) | ||||||
Nitori Holdings Co. Ltd. | 855,500 | 92,646 | ||||
Nomura Research Institute Ltd. | 3,252,200 | 85,370 | ||||
Daiwa Securities Group Inc. | 13,582,400 | 78,323 | ||||
Nidec Corp. | 2,072,500 | 76,022 | ||||
Toyota Motor Corp. | 4,333,500 | 75,809 | ||||
Nitto Denko Corp. | 1,091,600 | 70,633 | ||||
Denso Corp. | 4,324,800 | 63,861 | ||||
Daikin Industries Ltd. | 431,600 | 62,228 | ||||
Hoya Corp. | 629,300 | 60,582 | ||||
Nihon Kohden Corp. | 2,341,300 | 55,299 | ||||
Disco Corp. | 270,300 | 47,735 | ||||
ITOCHU Corp. | 1,310,100 | 47,191 | ||||
Suzuki Motor Corp. | 1,063,800 | 41,288 | ||||
Kubota Corp. | 3,068,400 | 41,268 | ||||
Bandai Namco Holdings Inc. | 1,853,700 | 38,406 | ||||
Recruit Holdings Co. Ltd. | 1,335,500 | 38,292 | ||||
Omron Corp. | 917,610 | 32,875 | ||||
Shimano Inc. | 227,500 | 32,739 | ||||
Subaru Corp. | 1,876,700 | 32,486 | ||||
Makita Corp. | 1,246,300 | 32,213 | ||||
Ain Holdings Inc. | 1,108,900 | 31,353 | ||||
* | Renesas Electronics Corp. | 2,273,800 | 29,868 | |||
Koito Manufacturing Co. Ltd. | 1,985,800 | 29,753 | ||||
Kansai Electric Power Co. Inc. | 2,154,600 | 27,587 | ||||
Nomura Holdings Inc. | 6,973,200 | 26,940 | ||||
Seria Co. Ltd. | 1,937,500 | 26,855 | ||||
Komatsu Ltd. | 931,000 | 21,391 | ||||
Daito Trust Construction Co. Ltd. | 160,200 | 17,184 | ||||
FANUC Corp. | 414,500 | 10,286 | ||||
1,326,483 |
Shares | Market Value• ($000) | |||||
Malaysia (0.2%) | ||||||
Westports Holdings Bhd. | 38,481,000 | 27,129 | ||||
Mexico (0.7%) | ||||||
Grupo Financiero Banorte SAB de CV | 11,158,700 | 90,562 | ||||
Netherlands (5.8%) | ||||||
Universal Music Group NV | 3,647,420 | 89,321 | ||||
* | Prosus NV | 3,178,870 | 89,116 | |||
ASM International NV | 178,840 | 73,804 | ||||
Aegon Ltd. | 13,401,722 | 65,176 | ||||
Akzo Nobel NV | 861,325 | 57,782 | ||||
Coca-Cola Europacific Partners plc | 937,292 | 54,677 | ||||
DSM-Firmenich AG | 561,313 | 50,886 | ||||
ING Groep NV | 3,903,893 | 50,050 | ||||
Wolters Kluwer NV | 341,051 | 43,759 | ||||
Koninklijke Vopak NV | 1,109,090 | 37,395 | ||||
IMCD NV | 278,274 | 33,503 | ||||
* | AerCap Holdings NV | 530,331 | 32,944 | |||
SBM Offshore NV | 2,272,520 | 28,303 | ||||
1 | ABN AMRO Bank NV | 979,952 | 13,199 | |||
719,915 | ||||||
Norway (0.3%) | ||||||
Bakkafrost P/F | 778,787 | 35,154 | ||||
Panama (0.6%) | ||||||
Copa Holdings SA Class A | 942,053 | 76,919 | ||||
Philippines (0.3%) | ||||||
Puregold Price Club Inc. | 43,303,300 | 20,685 | ||||
Universal Robina Corp. | 9,706,600 | 18,713 | ||||
39,398 | ||||||
Singapore (1.9%) | ||||||
United Overseas Bank Ltd. | 3,637,800 | 71,755 | ||||
DBS Group Holdings Ltd. | 2,224,400 | 53,437 | ||||
Venture Corp. Ltd. | 5,893,900 | 50,324 | ||||
Singapore Telecommunications Ltd. | 21,871,700 | 38,006 | ||||
Sembcorp Industries Ltd. | 8,653,300 | 29,031 | ||||
242,553 | ||||||
South Korea (2.3%) | ||||||
Samsung Electronics Co. Ltd. | 2,350,492 | 116,995 | ||||
1 | Samsung Electronics Co. Ltd. GDR | 82,490 | 103,196 | |||
SK Hynix Inc. | 675,713 | 58,680 | ||||
* | SK Square Co. Ltd. | 309,162 | 9,769 | |||
288,640 |
Shares | Market Value• ($000) | |||||
Spain (0.7%) | ||||||
Banco Santander SA | 17,602,140 | 64,739 | ||||
Industria de Diseno Textil SA | 832,978 | 28,753 | ||||
93,492 | ||||||
Sweden (0.4%) | ||||||
Assa Abloy AB Class B | 2,514,156 | 53,589 | ||||
Switzerland (6.0%) | ||||||
Roche Holding AG | 629,539 | 162,238 | ||||
Holcim AG | 2,451,769 | 151,587 | ||||
Novartis AG (Registered) | 1,416,867 | 132,647 | ||||
Cie Financiere Richemont SA (Registered) Class A | 806,337 | 95,128 | ||||
UBS Group AG (Registered) | 3,333,642 | 78,329 | ||||
ABB Ltd. (Registered) | 1,726,224 | 57,997 | ||||
Swatch Group AG | 116,950 | 29,936 | ||||
Adecco Group AG (Registered) | 786,649 | 29,770 | ||||
* | Sandoz Group AG | 283,373 | 7,368 | |||
745,000 | ||||||
Taiwan (2.1%) | ||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 11,275,000 | 184,149 | ||||
Taiwan Semiconductor Manufacturing Co. Ltd. ADR | 706,735 | 60,998 | ||||
King Slide Works Co. Ltd. | 949,000 | 20,712 | ||||
265,859 | ||||||
United Kingdom (14.3%) | ||||||
BP plc | 34,737,063 | 212,105 | ||||
RELX plc | 4,626,748 | 161,602 | ||||
Compass Group plc | 4,774,264 | 120,366 | ||||
HSBC Holdings plc | 15,870,476 | 114,592 | ||||
Unilever plc | 2,049,036 | 97,044 | ||||
Berkeley Group Holdings plc | 1,916,528 | 94,210 | ||||
Anglo American plc | 3,529,991 | 89,943 | ||||
HSBC Holdings plc (XHKG) | 11,214,000 | 80,573 | ||||
Prudential plc | 7,458,287 | 77,987 | ||||
Smiths Group plc | 3,849,200 | 75,505 | ||||
IMI plc | 4,226,990 | 75,490 | ||||
Smith & Nephew plc | 6,362,483 | 71,203 | ||||
Shell plc | 2,012,650 | 64,861 | ||||
Taylor Wimpey plc | 38,336,418 | 51,779 | ||||
Weir Group plc | 2,454,760 | 50,987 | ||||
RS Group plc | 5,499,045 | 45,380 | ||||
Travis Perkins plc | 4,642,103 | 41,826 | ||||
London Stock Exchange Group plc | 410,915 | 41,459 | ||||
Victrex plc | 2,240,170 | 37,531 | ||||
Spectris plc | 890,650 | 33,655 | ||||
Whitbread plc | 751,265 | 30,462 | ||||
Croda International plc | 546,804 | 29,143 |
Shares | Market Value• ($000) | |||||
Renishaw plc | 734,299 | 27,589 | ||||
Kingfisher plc | 10,496,980 | 26,804 | ||||
Lloyds Banking Group plc | 29,916,882 | 14,561 | ||||
* | easyJet plc | 2,644,536 | 11,797 | |||
1,778,454 | ||||||
United States (2.8%) | ||||||
Aon plc Class A | 416,187 | 128,768 | ||||
RenaissanceRe Holdings Ltd. | 383,167 | 84,140 | ||||
NXP Semiconductors NV | 392,463 | 67,672 | ||||
Linde plc | 161,680 | 61,772 | ||||
342,352 | ||||||
Vietnam (0.8%) | ||||||
Vietnam Dairy Products JSC | 19,975,400 | 55,324 | ||||
Phu Nhuan Jewelry JSC | 14,542,400 | 42,689 | ||||
98,013 | ||||||
Total Common Stocks (Cost $11,507,137) | 11,528,820 | |||||
Preferred Stocks (3.0%) | ||||||
Petroleo Brasileiro SA Preference Shares | 14,889,100 | 102,593 | ||||
Itau Unibanco Holding SA Preference Shares | 10,767,700 | 57,280 | ||||
Gerdau SA Preference Shares | 11,975,460 | 51,709 | ||||
Henkel AG & Co. KGaA Preference Shares | 965,047 | 69,614 | ||||
FUCHS SE Preference Shares | 1,349,387 | 54,805 |
Shares | Market Value• ($000) | |||||
Jungheinrich AG Preference Shares | 1,517,112 | 40,727 | ||||
Total Preferred Stocks (Cost $364,526) | 376,728 | |||||
Temporary Cash Investments (3.9%) | ||||||
Money Market Fund (3.9%) | ||||||
2 | Vanguard Market Liquidity Fund, 5.420% (Cost $479,253) | 4,794,491 | 479,401 | |||
Total Investments (99.7%) (Cost $12,350,916) | 12,384,949 | |||||
Other Assets and Liabilities—Net (0.3%) | 36,987 | |||||
Net Assets (100%) | 12,421,936 |
Cost is in $000. |
• | See Note A in Notes to Financial Statements. |
* | Non-income-producing security. |
1 | Security exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2023, the aggregate value was $256,507,000, representing 2.1% of net assets. |
2 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
ADR—American Depositary Receipt. | |
GDR—Global Depositary Receipt. |
Futures Contracts | ||||
($000) | ||||
Expiration | Number of Long (Short) Contracts | Notional Amount | Value and Unrealized Appreciation (Depreciation) | |
Long Futures Contracts | ||||
MSCI EAFE Index | December 2023 | 1,254 | 123,776 | (8,045) |
MSCI Emerging Market Index | December 2023 | 1,102 | 50,648 | (3,649) |
(11,694) |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value | |
Unaffiliated Issuers (Cost $11,871,663) | 11,905,548 |
Affiliated Issuers (Cost $479,253) | 479,401 |
Total Investments in Securities | 12,384,949 |
Investment in Vanguard | 453 |
Foreign Currency, at Value (Cost $9,021) | 8,740 |
Cash Collateral Pledged—Futures Contracts | 5,182 |
Receivables for Investment Securities Sold | 113,815 |
Receivables for Accrued Income | 54,740 |
Receivables for Capital Shares Issued | 3,019 |
Variation Margin Receivable—Futures Contracts | 34 |
Total Assets | 12,570,932 |
Liabilities | |
Due to Custodian | 11 |
Payables for Investment Securities Purchased | 128,689 |
Payables for Capital Shares Redeemed | 6,494 |
Payables to Investment Advisor | 5,571 |
Payables to Vanguard | 2,238 |
Deferred Foreign Capital Gains Taxes | 5,993 |
Total Liabilities | 148,996 |
Net Assets | 12,421,936 |
At October 31, 2023, net assets consisted of: | |
Paid-in Capital | 12,133,179 |
Total Distributable Earnings (Loss) | 288,757 |
Net Assets | 12,421,936 |
Net Assets | |
Applicable to 339,890,036 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 12,421,936 |
Net Asset Value Per Share | $36.55 |
Year Ended October 31, 2023 | |
($000) | |
Investment Income | |
Income | |
Dividends1 | 389,546 |
Interest2 | 25,163 |
Securities Lending—Net | 796 |
Total Income | 415,505 |
Expenses | |
Investment Advisory Fees—Note B | |
Basic Fee | 21,838 |
Performance Adjustment | 693 |
The Vanguard Group—Note C | |
Management and Administrative | 25,882 |
Marketing and Distribution | 802 |
Custodian Fees | 988 |
Auditing Fees | 45 |
Shareholders’ Reports | 199 |
Trustees’ Fees and Expenses | 7 |
Other Expenses | 1,818 |
Total Expenses | 52,272 |
Net Investment Income | 363,233 |
Realized Net Gain (Loss) | |
Investment Securities Sold2,3 | 255,229 |
Futures Contracts | 17,153 |
Foreign Currencies | (501) |
Realized Net Gain (Loss) | 271,881 |
Change in Unrealized Appreciation (Depreciation) | |
Investment Securities2,4 | 1,002,782 |
Futures Contracts | 4,925 |
Foreign Currencies | 59 |
Change in Unrealized Appreciation (Depreciation) | 1,007,766 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 1,642,880 |
1 | Dividends are net of foreign withholding taxes of $22,790,000. |
2 | Interest income, realized net gain (loss), capital gain distributions received, and change in unrealized appreciation (depreciation) from an affiliated company of the fund were $24,784,000, $61,000, $2,000, and $13,000, respectively. Purchases and sales are for temporary cash investment purposes. |
3 | Realized Gain (Loss) is net of foreign capital gains taxes of $8,313,000. |
4 | The change in unrealized appreciation (depreciation) is net of the change in deferred foreign capital gains taxes of ($7,524,000). |
Year Ended October 31, | ||
2023 ($000) | 2022 ($000) | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net Investment Income | 363,233 | 365,829 |
Realized Net Gain (Loss) | 271,881 | (314,479) |
Change in Unrealized Appreciation (Depreciation) | 1,007,766 | (3,259,520) |
Net Increase (Decrease) in Net Assets Resulting from Operations | 1,642,880 | (3,208,170) |
Distributions | ||
Total Distributions | (341,585) | (633,591) |
Capital Share Transactions | ||
Issued | 1,777,129 | 2,352,101 |
Issued in Lieu of Cash Distributions | 304,194 | 576,930 |
Redeemed | (2,693,213) | (2,573,910) |
Net Increase (Decrease) from Capital Share Transactions | (611,890) | 355,121 |
Total Increase (Decrease) | 689,405 | (3,486,640) |
Net Assets | ||
Beginning of Period | 11,732,531 | 15,219,171 |
End of Period | 12,421,936 | 11,732,531 |
For a Share Outstanding Throughout Each Period | Year Ended October 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $32.96 | $43.76 | $32.48 | $36.63 | $35.86 |
Investment Operations | |||||
Net Investment Income1 | 1.045 | 1.019 | 1.091 | .684 | 1.104 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.528 | (10.011) | 10.824 | (3.723) | 1.669 |
Total from Investment Operations | 4.573 | (8.992) | 11.915 | (3.039) | 2.773 |
Distributions | |||||
Dividends from Net Investment Income | (.983) | (1.087) | (.635) | (1.111) | (.943) |
Distributions from Realized Capital Gains | — | (.721) | — | — | (1.060) |
Total Distributions | (.983) | (1.808) | (.635) | (1.111) | (2.003) |
Net Asset Value, End of Period | $36.55 | $32.96 | $43.76 | $32.48 | $36.63 |
Total Return2 | 13.97% | -21.28% | 36.91% | -8.69% | 8.48% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $12,422 | $11,733 | $15,219 | $9,408 | $10,360 |
Ratio of Total Expenses to Average Net Assets3 | 0.39% | 0.38% | 0.36% | 0.35% | 0.37% |
Ratio of Net Investment Income to Average Net Assets | 2.72% | 2.68% | 2.56% | 2.05% | 3.15% |
Portfolio Turnover Rate | 29% | 37% | 33% | 72% | 38% |
1 | Calculated based on average shares outstanding. |
2 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
3 | Includes performance-based investment advisory fee increases (decreases) of 0.01%, 0.00%, (0.01%), (0.02%), and (0.01%). |
Level 1 ($000) | Level 2 ($000) | Level 3 ($000) | Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks—North and South America | 1,057,433 | 61,772 | — | 1,119,205 |
Common Stocks—Other | 630,228 | 9,779,387 | — | 10,409,615 |
Preferred Stocks | 211,582 | 165,146 | — | 376,728 |
Temporary Cash Investments | 479,401 | — | — | 479,401 |
Total | 2,378,644 | 10,006,305 | — | 12,384,949 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Futures Contracts1 | 11,694 | — | — | 11,694 |
1 | Includes cumulative appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
Amount ($000) | |
Undistributed Ordinary Income | 315,576 |
Undistributed Long-Term Gains | — |
Net Unrealized Gains (Losses) | (14,245) |
Capital Loss Carryforwards | (17,498) |
Qualified Late-Year Losses | — |
Other Temporary Differences | 4,924 |
Total | 288,757 |
Year Ended October 31, | ||
2023 Amount ($000) | 2022 Amount ($000) | |
Ordinary Income* | 341,585 | 633,591 |
Long-Term Capital Gains | — | — |
Total | 341,585 | 633,591 |
* | Includes short-term capital gains, if any. |
Amount ($000) | |
Tax Cost | 12,391,381 |
Gross Unrealized Appreciation | 1,653,427 |
Gross Unrealized Depreciation | (1,659,859) |
Net Unrealized Appreciation (Depreciation) | (6,432) |
Year Ended October 31, | ||
2023 Shares (000) | 2022 Shares (000) | |
Issued | 46,674 | 61,320 |
Issued in Lieu of Cash Distributions | 8,593 | 14,416 |
Redeemed | (71,293) | (67,638) |
Net Increase (Decrease) in Shares Outstanding | (16,026) | 8,098 |
Philadelphia, Pennsylvania
December 19, 2023
Matthew Benchener | Thomas M. Rampulla |
Joseph Brennan | Karin A. Risi |
Mortimer J. Buckley | Anne E. Robinson |
Gregory Davis | Michael Rollings |
John James | Nitin Tandon |
Chris D. McIsaac | Lauren Valente |
Who Are Deaf or Hard of Hearing > 800-749-7273
All rights reserved.
Vanguard Marketing Corporation, Distributor.
1 | |
2 | |
4 | |
6 |
• | For the 12 months ended October 31, 2023, Vanguard Diversified Equity Fund returned 7.88%, lagging the 8.51% return of its benchmark, the MSCI US Broad Market Index. |
• | Early on, inflation continued to ease amid ongoing interest rate hikes by the Federal Reserve. Unexpected resilience in the labor market and consumer spending helped dial back expectations of a sustained recession, but the prospect of higher interest rates for longer and heightened geopolitical tensions weighed on market sentiment toward the close of the period. |
• | Vanguard Diversified Equity Fund is a fund of funds, investing in six actively managed Vanguard funds selected to provide broad exposure to all segments of the U.S. equity market. Together, the funds cover the style and capitalization spectrum. |
• | Returns of the underlying funds ranged from about –2% for Vanguard Explorer Fund to more than 15% for Vanguard U.S. Growth Fund. Three of the funds outpaced their benchmark indexes and three lagged. The underperforming funds accounted for roughly half the fund’s assets. |
Average Annual Total Returns Periods Ended October 31, 2023 | |||
One Year | Three Years | Five Years | |
Stocks | |||
Russell 1000 Index (Large-caps) | 9.48% | 9.53% | 10.71% |
Russell 2000 Index (Small-caps) | -8.56 | 3.95 | 3.31 |
Russell 3000 Index (Broad U.S. market) | 8.38 | 9.19 | 10.23 |
FTSE All-World ex US Index (International) | 12.35 | 3.51 | 3.88 |
Bonds | |||
Bloomberg U.S. Aggregate Float Adjusted Index (Broad taxable market) | 0.53% | -5.51% | 0.03% |
Bloomberg Municipal Bond Index (Broad tax-exempt market) | 2.64 | -2.48 | 1.00 |
FTSE Three-Month U.S. Treasury Bill Index | 4.94 | 1.93 | 1.80 |
CPI | |||
Consumer Price Index | 3.24% | 5.72% | 4.00% |
• | Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund’s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. |
• | Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds. |
Six Months Ended October 31, 2023 | |||
Diversified Equity Fund | Beginning Account Value 4/30/2023 | Ending Account Value 10/31/2023 | Expenses Paid During Period |
Based on Actual Fund Return | $1,000.00 | $1,004.80 | $1.77 |
Based on Hypothetical 5% Yearly Return | 1,000.00 | 1,023.44 | 1.79 |
Average Annual Total Returns Periods Ended October 31, 2023 | |||||
One Year | Five Years | Ten Years | Final Value of a $10,000 Investment | ||
Diversified Equity Fund | 7.88% | 10.02% | 10.09% | $26,149 | |
MSCI US Broad Market Index | 8.51 | 10.35 | 10.60 | 27,394 |
Vanguard U.S. Growth Fund Investor Shares | 30.1% |
Vanguard Growth and Income Fund Investor Shares | 20.3 |
Vanguard WindsorTM Fund Investor Shares | 20.0 |
Vanguard Windsor II Fund Investor Shares | 15.2 |
Vanguard ExplorerTM Fund Investor Shares | 9.7 |
Vanguard Mid-Cap Growth Fund | 4.7 |
Shares | Market Value• ($000) | |||||
Investment Companies (100.1%) | ||||||
U.S. Stock Funds (100.1%) | ||||||
Vanguard U.S. Growth Fund Investor Shares | 14,202,594 | 676,186 | ||||
Vanguard Growth and Income Fund Investor Shares | 8,671,500 | 456,381 | ||||
Vanguard Windsor Fund Investor Shares | 22,285,386 | 450,611 | ||||
Vanguard Windsor II Fund Investor Shares | 8,691,871 | 340,982 | ||||
Vanguard Explorer Fund Investor Shares | 2,352,435 | 217,835 | ||||
Vanguard Mid-Cap Growth Fund | 5,484,992 | 106,299 | ||||
Total Investment Companies (Cost $1,679,080) | 2,248,294 | |||||
Temporary Cash Investments (0.0%) | ||||||
Money Market Fund (0.0%) | ||||||
1 | Vanguard Market Liquidity Fund, 5.420% (Cost $—) | 1 | — | |||
Total Investments (100.1%) (Cost $1,679,080) | 2,248,294 | |||||
Other Assets and Liabilities—Net (-0.1%) | (2,130) | |||||
Net Assets (100%) | 2,246,164 |
Cost is in $000. |
• | See Note A in Notes to Financial Statements. |
1 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value—Affiliated Funds (Cost $1,679,080) | 2,248,294 |
Receivables for Investment Securities Sold | 66 |
Receivables for Capital Shares Issued | 367 |
Total Assets | 2,248,727 |
Liabilities | |
Due to Custodian | 247 |
Payables for Capital Shares Redeemed | 2,316 |
Total Liabilities | 2,563 |
Net Assets | 2,246,164 |
At October 31, 2023, net assets consisted of: | |
Paid-in Capital | 1,596,706 |
Total Distributable Earnings (Loss) | 649,458 |
Net Assets | 2,246,164 |
Net Assets | |
Applicable to 56,939,767 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 2,246,164 |
Net Asset Value Per Share | $39.45 |
Year Ended October 31, 2023 | |
($000) | |
Investment Income | |
Income | |
Income Distributions Received from Affiliated Funds | 22,497 |
Net Investment Income—Note B | 22,497 |
Realized Net Gain (Loss) | |
Capital Gain Distributions Received from Affiliated Funds | 111,577 |
Affiliated Funds Sold | (27,502) |
Realized Net Gain (Loss) | 84,075 |
Change in Unrealized Appreciation (Depreciation) from Affiliated Funds | 58,510 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 165,082 |
Year Ended October 31, | ||
2023 ($000) | 2022 ($000) | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net Investment Income | 22,497 | 19,185 |
Realized Net Gain (Loss) | 84,075 | 327,658 |
Change in Unrealized Appreciation (Depreciation) | 58,510 | (967,703) |
Net Increase (Decrease) in Net Assets Resulting from Operations | 165,082 | (620,860) |
Distributions | ||
Total Distributions | (242,790) | (196,729) |
Capital Share Transactions | ||
Issued | 220,636 | 293,317 |
Issued in Lieu of Cash Distributions | 224,491 | 182,595 |
Redeemed | (301,556) | (443,391) |
Net Increase (Decrease) from Capital Share Transactions | 143,571 | 32,521 |
Total Increase (Decrease) | 65,863 | (785,068) |
Net Assets | ||
Beginning of Period | 2,180,301 | 2,965,369 |
End of Period | 2,246,164 | 2,180,301 |
For a Share Outstanding Throughout Each Period | Year Ended October 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $41.38 | $56.40 | $40.98 | $37.95 | $35.88 |
Investment Operations | |||||
Net Investment Income1 | .398 | .356 | .385 | .452 | .455 |
Capital Gain Distributions Received1 | 1.973 | 6.162 | 2.294 | 1.866 | 3.087 |
Net Realized and Unrealized Gain (Loss) on Investments | .358 | (17.785) | 15.438 | 3.447 | .575 |
Total from Investment Operations | 2.729 | (11.267) | 18.117 | 5.765 | 4.117 |
Distributions | |||||
Dividends from Net Investment Income | (.256) | (.317) | (.346) | (.369) | (.383) |
Distributions from Realized Capital Gains | (4.403) | (3.436) | (2.351) | (2.366) | (1.664) |
Total Distributions | (4.659) | (3.753) | (2.697) | (2.735) | (2.047) |
Net Asset Value, End of Period | $39.45 | $41.38 | $56.40 | $40.98 | $37.95 |
Total Return2 | 7.88% | -21.42% | 45.67% | 15.73% | 12.82% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $2,246 | $2,180 | $2,965 | $1,919 | $1,789 |
Ratio of Total Expenses to Average Net Assets | — | — | — | — | — |
Acquired Fund Fees and Expenses | 0.35% | 0.35% | 0.35% | 0.35% | 0.35% |
Ratio of Net Investment Income to Average Net Assets | 0.99% | 0.77% | 0.76% | 1.19% | 1.27% |
Portfolio Turnover Rate | 7% | 12% | 6% | 14% | 9% |
1 | Calculated based on average shares outstanding. |
2 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
Amount ($000) | |
Paid-in Capital | 9,192 |
Total Distributable Earnings (Loss) | (9,192) |
Amount ($000) | |
Undistributed Ordinary Income | 7,194 |
Undistributed Long-Term Gains | 78,098 |
Net Unrealized Gains (Losses) | 564,166 |
Capital Loss Carryforwards | — |
Qualified Late-Year Losses | — |
Other Temporary Differences | — |
Total | 649,458 |
Year Ended October 31, | ||
2023 Amount ($000) | 2022 Amount ($000) | |
Ordinary Income* | 13,657 | 100,746 |
Long-Term Capital Gains | 229,133 | 95,983 |
Total | 242,790 | 196,729 |
* | Includes short-term capital gains, if any. |
Amount ($000) | |
Tax Cost | 1,684,128 |
Gross Unrealized Appreciation | 647,669 |
Gross Unrealized Depreciation | (83,503) |
Net Unrealized Appreciation (Depreciation) | 564,166 |
Year Ended October 31, | ||
2023 Shares (000) | 2022 Shares (000) | |
Issued | 5,424 | 6,163 |
Issued in Lieu of Cash Distributions | 6,342 | 3,454 |
Redeemed | (7,518) | (9,499) |
Net Increase (Decrease) in Shares Outstanding | 4,248 | 118 |
Current Period Transactions | ||||||||
Oct. 31, 2022 Market Value ($000) | Purchases at Cost ($000) | Proceeds from Securities Sold ($000) | Realized Net Gain (Loss) ($000) | Change in Unrealized App. (Dep.) ($000) | Income ($000) | Capital Gain Distributions Received ($000) | Oct. 31, 2023 Market Value ($000) | |
Vanguard Explorer Fund | 219,915 | 28,430 | 14,078 | (1,890) | (14,542) | 794 | 9,689 | 217,835 |
Vanguard Growth and Income Fund | 440,104 | 38,407 | 21,150 | (1,501) | 521 | 6,565 | 31,843 | 456,381 |
Vanguard Market Liquidity Fund | — | NA1 | NA1 | — | — | 4 | — | — |
Vanguard Mid-Cap Growth Fund | 107,541 | 275 | 2,451 | (1,865) | 2,799 | 275 | — | 106,299 |
Vanguard U.S. Growth Fund | 638,320 | 8,268 | 66,575 | (23,641) | 119,814 | 2,215 | — | 676,186 |
Vanguard Windsor Fund | 443,595 | 89,251 | 34,285 | 1,105 | (49,055) | 7,201 | 52,563 | 450,611 |
Vanguard Windsor II Fund | 331,267 | 26,417 | 15,965 | 290 | (1,027) | 5,443 | 17,482 | 340,982 |
Total | 2,180,742 | 191,048 | 154,504 | (27,502) | 58,510 | 22,497 | 111,577 | 2,248,294 |
1 | Not applicable—purchases and sales are for temporary cash investment purposes. |
Philadelphia, Pennsylvania
December 19, 2023
Matthew Benchener | Thomas M. Rampulla |
Joseph Brennan | Karin A. Risi |
Mortimer J. Buckley | Anne E. Robinson |
Gregory Davis | Michael Rollings |
John James | Nitin Tandon |
Chris D. McIsaac | Lauren Valente |
Who Are Deaf or Hard of Hearing > 800-749-7273
All rights reserved.
Vanguard Marketing Corporation, Distributor.
Your Fund’s Performance at a Glance | 1 |
Advisors’ Report | 2 |
About Your Fund’s Expenses | 7 |
Performance Summary | 9 |
Financial Statements | 11 |
• | For the 12 months ended October 31, 2023, Vanguard Emerging Markets Select Stock Fund returned 15.10%, outpacing the 10.96% return of its benchmark, the FTSE Emerging Index. |
• | Early on, inflation in many developed markets eased off multidecade highs amid ongoing interest rate hikes by central banks. Unexpected resilience in labor markets and consumer spending helped dial back expectations of a sustained global recession, but the prospect of higher interest rates for longer and heightened geopolitical tensions weighed on market sentiment toward the close of the period. |
• | On a geographic basis, the fund benefited from both market selection—overweighting strong performers or underweighting laggards—and security selection. Among the largest contributors were holdings in Hong Kong and South Korea, which are excluded from the index but recorded strong double-digit advances. These holdings totaled roughly 11% of the fund, on average. An underweight stake in China and underperforming holdings there crimped performance. |
• | The fund’s holdings outperformed those of the index in 10 of 11 sectors. Only its consumer staples holdings lagged. The effect on the fund was negligible, however, as the advisor allocated less than 5% of fund assets to the sector, which trailed the weighting of the overall index. |
Average Annual Total Returns Periods Ended October 31, 2023 | |||
One Year | Three Years | Five Years | |
Stocks | |||
Russell 1000 Index (Large-caps) | 9.48% | 9.53% | 10.71% |
Russell 2000 Index (Small-caps) | -8.56 | 3.95 | 3.31 |
Russell 3000 Index (Broad U.S. market) | 8.38 | 9.19 | 10.23 |
FTSE All-World ex US Index (International) | 12.35 | 3.51 | 3.88 |
Bonds | |||
Bloomberg U.S. Aggregate Float Adjusted Index (Broad taxable market) | 0.53% | -5.51% | 0.03% |
Bloomberg Municipal Bond Index (Broad tax-exempt market) | 2.64 | -2.48 | 1.00 |
FTSE Three-Month U.S. Treasury Bill Index | 4.94 | 1.93 | 1.80 |
CPI | |||
Consumer Price Index | 3.24% | 5.72% | 4.00% |
Fund Assets Managed | |||
Investment Advisor | % | $ Million | Investment Strategy |
Pzena Investment Management, LLC | 26 | 181 | Uses a deep-value approach that focuses on the most undervalued companies based on price-to-normalized earnings. The firm believes that this value philosophy works well globally and is especially effective in emerging markets because of generally wider valuation spreads. |
Baillie Gifford Overseas Ltd. | 24 | 169 | Believes that companies that can sustainably grow their business and increase earnings faster than market average will perform best. Stock selection is driven by bottom-up, fundamental analysis, focusing on a company’s potential over a meaningful time period, typically three to five years and beyond. |
Oaktree Fund Advisors, LLC | 24 | 167 | Seeks securities that have been undervalued by investors. Oaktree’s investment process is driven by bottom-up research, which includes extensive travel to meet company management and maintaining in-house models focused on deriving reliable cash-flow projections. |
Wellington Management Company llp | 23 | 167 | Allocates the assets in its portion of the fund to a team of global analysts who seek to add value through in-depth fundamental research and understanding of their industries. By covering the same companies over a period of many years, these investment professionals gain comprehensive insight to guide decisions for their subportfolios. |
Cash Investments | 3 | 25 | These short-term reserves are invested by Vanguard in equity index products to simulate investment in stocks. Each advisor may also maintain a modest cash position. |
• | Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund‘s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. |
• | Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds. |
Six Months Ended October 31, 2023 | |||
Emerging Markets Select Stock Fund | Beginning Account Value 4/30/2023 | Ending Account Value 10/31/2023 | Expenses Paid During Period |
Based on Actual Fund Return | $1,000.00 | $958.80 | $3.90 |
Based on Hypothetical 5% Yearly Return | 1,000.00 | 1,021.22 | 4.02 |
Average Annual Total Returns Periods Ended October 31, 2023 | |||||
One Year | Five Years | Ten Years | Final Value of a $10,000 Investment | ||
Emerging Markets Select Stock Fund | 15.10% | 2.90% | 1.86% | $12,027 | |
FTSE Emerging Index | 10.96 | 2.62 | 1.85 | 12,012 | |
MSCI All Country World Index ex USA | 12.07 | 3.46 | 2.54 | 12,854 |
China | 29.5% |
India | 13.7 |
Brazil | 11.5 |
Taiwan | 11.0 |
South Korea | 6.3 |
United States | 4.9 |
Hong Kong | 4.4 |
Thailand | 3.0 |
South Africa | 2.2 |
Mexico | 2.2 |
Indonesia | 2.1 |
United Kingdom | 1.4 |
Saudi Arabia | 1.4 |
Other | 6.4 |
Shares | Market Value• ($000) | ||
Common Stocks (92.3%) | |||
Brazil (8.7%) | |||
Petroleo Brasileiro SA ADR (XNYS) | 785,288 | 11,779 | |
Vale SA ADR | 589,506 | 8,082 | |
Banco Bradesco SA ADR | 2,437,315 | 6,800 | |
Ambev SA | 2,201,766 | 5,616 | |
Cia de Saneamento Basico do Estado de Sao Paulo | 249,547 | 2,889 | |
Neoenergia SA | 763,100 | 2,652 | |
Centrais Eletricas Brasileiras SA | 379,218 | 2,621 | |
Banco Do Brasil SA | 262,600 | 2,518 | |
B3 SA - Brasil Bolsa Balcao | 1,086,700 | 2,392 | |
TIM SA | 754,789 | 2,271 | |
Petroleo Brasileiro SA ADR | 162,039 | 2,241 | |
Itau Unibanco Holding SA ADR | 417,129 | 2,215 | |
Localiza Rent a Car SA (BVMF) | 219,494 | 2,215 | |
* | Natura & Co. Holding SA | 639,500 | 1,617 |
Petroleo Brasileiro SA | 180,939 | 1,358 | |
Lojas Renner SA | 550,196 | 1,338 | |
Vale SA | 66,800 | 914 | |
Weg SA | 132,700 | 869 | |
Raia Drogasil SA | 97,024 | 497 | |
*,1 | Hapvida Participacoes e Investimentos SA | 288,262 | 211 |
* | Magazine Luiza SA | 665,520 | 176 |
1 | Rede D'Or Sao Luiz SA | 35,600 | 153 |
Brpr Corporate Offices Fdo De Inv Imob | 1,557 | 19 | |
61,443 | |||
Canada (0.9%) | |||
Parex Resources Inc. | 120,542 | 2,310 | |
First Quantum Minerals Ltd. | 171,622 | 1,989 | |
Lundin Mining Corp. | 177,373 | 1,108 | |
* | Valeura Energy Inc. | 264,800 | 750 |
6,157 |
Shares | Market Value• ($000) | ||
Chile (0.4%) | |||
2 | Sociedad Quimica y Minera de Chile SA ADR | 29,277 | 1,417 |
Banco De Chile | 11,148,490 | 1,145 | |
2,562 | |||
China (28.1%) | |||
* | Alibaba Group Holding Ltd. | 2,172,395 | 22,365 |
Tencent Holdings Ltd. | 553,244 | 20,475 | |
China Merchants Bank Co. Ltd. Class H | 2,169,938 | 8,231 | |
Weichai Power Co. Ltd. Class H | 5,417,864 | 8,110 | |
Haier Smart Home Co. Ltd. Class H | 2,398,200 | 6,840 | |
Ping An Insurance Group Co. of China Ltd. Class H | 1,134,994 | 5,757 | |
Zijin Mining Group Co. Ltd. Class H | 3,694,628 | 5,715 | |
China Construction Bank Corp. Class H | 8,566,677 | 4,845 | |
* | Baidu Inc. Class A | 331,500 | 4,352 |
ANTA Sports Products Ltd. | 379,225 | 4,289 | |
China Overseas Land & Investment Ltd. | 2,246,319 | 4,239 | |
Anhui Conch Cement Co. Ltd. Class H | 1,608,356 | 4,003 | |
Aluminum Corp. of China Ltd. Class H | 7,378,126 | 3,947 | |
1 | WuXi AppTec Co. Ltd. Class H | 309,176 | 3,715 |
*,1 | Meituan Class B | 250,602 | 3,552 |
Shenzhou International Group Holdings Ltd. | 356,000 | 3,497 | |
Contemporary Amperex Technology Co. Ltd. Class A (XSHE) | 128,551 | 3,264 | |
China Mengniu Dairy Co. Ltd. | 988,173 | 3,227 | |
Kweichow Moutai Co. Ltd. Class A | 13,700 | 3,155 | |
Industrial & Commercial Bank of China Ltd. Class H | 5,972,724 | 2,862 | |
* | Trip.com Group Ltd. ADR | 81,637 | 2,776 |
KE Holdings Inc. ADR | 172,775 | 2,541 |
Shares | Market Value• ($000) | ||
GF Securities Co. Ltd. Class H | 1,948,400 | 2,537 | |
Geely Automobile Holdings Ltd. | 2,225,403 | 2,527 | |
Zhejiang Longsheng Group Co. Ltd. Class A | 1,933,100 | 2,352 | |
JD.com Inc. ADR | 80,612 | 2,049 | |
* | Trip.com Group Ltd. | 59,622 | 2,032 |
ENN Energy Holdings Ltd. | 254,374 | 1,927 | |
Brilliance China Automotive Holdings Ltd. | 4,186,000 | 1,924 | |
CITIC Securities Co. Ltd. Class H | 966,551 | 1,881 | |
Midea Group Co. Ltd. Class A (XSEC) | 255,794 | 1,850 | |
PICC Property & Casualty Co. Ltd. Class H | 1,592,000 | 1,818 | |
China Resources Land Ltd. | 464,480 | 1,739 | |
Sunny Optical Technology Group Co. Ltd. | 205,380 | 1,721 | |
Anker Innovations Technology Co. Ltd. Class A | 128,400 | 1,645 | |
China Longyuan Power Group Corp. Ltd. Class H | 1,931,350 | 1,635 | |
* | Daqo New Energy Corp. ADR | 62,994 | 1,604 |
CIMC Enric Holdings Ltd. | 1,810,000 | 1,536 | |
JD.com Inc. Class A | 117,851 | 1,498 | |
1 | China Tourism Group Duty Free Corp. Ltd. Class H | 130,307 | 1,472 |
Minth Group Ltd. | 610,000 | 1,362 | |
Nine Dragons Paper Holdings Ltd. | 2,389,888 | 1,360 | |
* | Shanghai International Airport Co. Ltd. Class A | 257,857 | 1,312 |
KE Holdings Inc. Class A | 264,770 | 1,304 | |
Midea Group Co. Ltd. Class A | 177,486 | 1,284 | |
Muyuan Foods Co. Ltd.Class A | 245,369 | 1,265 | |
Sinoma Science & Technology Co. Ltd. Class A | 494,300 | 1,169 | |
1 | Longfor Group Holdings Ltd. | 790,760 | 1,151 |
Yunnan Energy New Material Co. Ltd. Class A | 121,600 | 1,116 | |
BYD Co. Ltd. Class H | 36,500 | 1,110 | |
Ping An Bank Co. Ltd. Class A | 768,940 | 1,100 | |
Bank of Ningbo Co. Ltd. Class A | 306,900 | 1,048 | |
China Tourism Group Duty Free Corp. Ltd. Class A | 76,611 | 991 | |
* | Tencent Music Entertainment Group ADR | 132,550 | 962 |
* | BeiGene Ltd. | 66,950 | 961 |
China National Building Material Co. Ltd. Class H | 1,883,983 | 897 |
Shares | Market Value• ($000) | ||
*,1 | Wuxi Biologics Cayman Inc. | 143,500 | 892 |
Li Ning Co. Ltd. | 289,000 | 886 | |
Suofeiya Home Collection Co. Ltd. Class A | 354,790 | 873 | |
* | Baidu Inc. ADR | 8,144 | 855 |
Proya Cosmetics Co. Ltd. Class A | 57,980 | 823 | |
Tsingtao Brewery Co. Ltd. Class H | 102,000 | 773 | |
1 | CSC Financial Co. Ltd. Class H | 813,157 | 732 |
Ping An Insurance Group Co. of China Ltd. Class A | 117,700 | 731 | |
Zoomlion Heavy Industry Science and Technology Co. Ltd. Class A | 721,750 | 633 | |
* | Kanzhun Ltd. ADR | 42,179 | 624 |
*,1 | Kuaishou Technology | 95,900 | 618 |
Suofeiya Home Collection Co. Ltd. Class A (XSHE) | 207,445 | 511 | |
Sinopharm Group Co. Ltd. Class H | 205,600 | 492 | |
Anker Innovations Technology Co. Ltd. Class A (XSHE) | 36,300 | 465 | |
* | Zai Lab Ltd. | 171,600 | 438 |
* | Sichuan Kelun-Biotech Biopharmaceutical Co. Ltd. | 35,100 | 374 |
WuXi AppTec Co. Ltd. Class A | 30,600 | 362 | |
Shenzhen Mindray Bio-Medical Electronics Co. Ltd. Class A | 8,100 | 317 | |
* | H World Group Ltd. ADR | 7,898 | 297 |
Zhongsheng Group Holdings Ltd. | 119,500 | 276 | |
* | Zai Lab Ltd. ADR | 10,745 | 271 |
Aluminum Corp of China Ltd. Class A | 317,594 | 269 | |
Shandong Weigao Group Medical Polymer Co. Ltd. Class H | 276,718 | 257 | |
Shanghai Pharmaceuticals Holding Co. Ltd. Class A | 97,700 | 241 | |
Lufax Holding Ltd. ADR | 245,187 | 234 | |
* | BeiGene Ltd. ADR | 1,152 | 215 |
Yuexiu Property Co. Ltd. | 190,000 | 198 | |
1 | Yadea Group Holdings Ltd. | 106,000 | 193 |
Amoy Diagnostics Co. Ltd. Class A (XSHE) | 53,080 | 158 | |
China Vanke Co. Ltd. Class H | 156,500 | 146 | |
*,1 | Remegen Co. Ltd. Class H | 22,859 | 130 |
Asymchem Laboratories Tianjin Co. Ltd. Class A | 6,260 | 129 | |
Amoy Diagnostics Co. Ltd. Class A | 37,094 | 110 |
Shares | Market Value• ($000) | ||
1 | Asymchem Laboratories Tianjin Co. Ltd. Class H | 6,691 | 87 |
* | GDS Holdings Ltd. ADR | 7,756 | 80 |
* | Alibaba Group Holding Ltd. ADR | 860 | 71 |
Changzhou Xingyu Automotive Lighting Systems Co. Ltd. Class A | 3,500 | 70 | |
Shenzhen Mindray Bio-Medical Electronics Co. Ltd. Class A (XSHE) | 1,700 | 66 | |
* | Grand Baoxin Auto Group Ltd. | 2,010,500 | 50 |
198,843 | |||
Egypt (0.0%) | |||
Commercial International Bank Egypt SAE GDR (Registered) | 2 | — | |
Greece (0.4%) | |||
* | Alpha Services and Holdings SA | 2,182,259 | 3,267 |
Hong Kong (4.2%) | |||
Galaxy Entertainment Group Ltd. | 1,424,591 | 8,008 | |
Pacific Basin Shipping Ltd. | 20,973,846 | 6,069 | |
Lenovo Group Ltd. | 3,878,000 | 4,513 | |
1 | WH Group Ltd. | 5,093,000 | 3,042 |
Yue Yuen Industrial Holdings Ltd. | 2,357,500 | 2,757 | |
AIA Group Ltd. | 217,104 | 1,885 | |
* | Sands China Ltd. | 599,224 | 1,613 |
Orient Overseas International Ltd. | 113,462 | 1,431 | |
Wharf Holdings Ltd. | 70,500 | 179 | |
29,497 | |||
Hungary (0.8%) | |||
OTP Bank Nyrt | 141,164 | 5,254 | |
MOL Hungarian Oil & Gas plc | 87,031 | 693 | |
5,947 | |||
India (13.0%) | |||
Reliance Industries Ltd. | 580,409 | 15,960 | |
HDFC Bank Ltd. | 554,137 | 9,833 | |
Larsen & Toubro Ltd. | 167,725 | 5,902 | |
Shriram Finance Ltd. | 217,942 | 4,918 | |
Bharti Airtel Ltd. (XNSE) | 369,648 | 4,060 | |
2 | Infosys Ltd. ADR | 237,016 | 3,892 |
UltraTech Cement Ltd. | 37,002 | 3,745 | |
Aurobindo Pharma Ltd. | 361,278 | 3,687 | |
Tata Consultancy Services Ltd. | 83,242 | 3,370 | |
ICICI Bank Ltd. ADR | 141,175 | 3,133 | |
Axis Bank Ltd. | 236,797 | 2,794 | |
1 | HDFC Life Insurance Co. Ltd. | 348,422 | 2,588 |
Tech Mahindra Ltd. | 171,428 | 2,336 | |
* | Jio Financial Services Ltd. | 808,359 | 2,126 |
Hindustan Unilever Ltd. | 55,967 | 1,670 | |
* | Godrej Consumer Products Ltd. | 131,729 | 1,570 |
Kotak Mahindra Bank Ltd. | 70,943 | 1,483 |
Shares | Market Value• ($000) | ||
Oil & Natural Gas Corp. Ltd. | 652,067 | 1,459 | |
Adani Ports & Special Economic Zone Ltd. | 154,519 | 1,458 | |
Ambuja Cements Ltd. | 261,126 | 1,332 | |
Bajaj Auto Ltd. | 20,605 | 1,314 | |
Varun Beverages Ltd. | 108,154 | 1,180 | |
* | Delhivery Ltd. | 230,116 | 1,142 |
Tata Consumer Products Ltd. | 104,092 | 1,126 | |
1 | SBI Life Insurance Co. Ltd. | 67,051 | 1,101 |
Colgate-Palmolive India Ltd. | 37,717 | 958 | |
* | Amber Enterprises India Ltd. | 25,224 | 890 |
Jubilant Foodworks Ltd. | 127,889 | 770 | |
Container Corp. of India Ltd. | 91,586 | 757 | |
Glenmark Pharmaceuticals Ltd. | 83,109 | 747 | |
* | Zomato Ltd. | 539,900 | 683 |
ICICI Bank Ltd. | 55,389 | 609 | |
Apollo Hospitals Enterprise Ltd. | 10,352 | 599 | |
Cipla Ltd. | 41,184 | 594 | |
Maruti Suzuki India Ltd. | 4,684 | 585 | |
Mahindra & Mahindra Ltd. | 27,753 | 486 | |
HDFC Bank Ltd. ADR | 7,366 | 417 | |
Eicher Motors Ltd. | 9,842 | 390 | |
Tata Steel Ltd. | 192,112 | 274 | |
Fortis Healthcare Ltd. | 63,272 | 245 | |
Hero MotoCorp Ltd. | 2,151 | 80 | |
92,263 | |||
Indonesia (2.0%) | |||
Bank Rakyat Indonesia Persero Tbk PT | 40,036,042 | 12,519 | |
Telkom Indonesia Persero Tbk PT | 7,428,664 | 1,628 | |
14,147 | |||
Kenya (0.1%) | |||
Equity Group Holdings plc | 2,797,214 | 698 | |
Mexico (2.1%) | |||
Grupo Financiero Banorte SAB de CV Class O | 642,993 | 5,218 | |
Wal-Mart de Mexico SAB de CV | 900,534 | 3,223 | |
Fomento Economico Mexicano SAB de CV ADR | 17,208 | 1,952 | |
* | Cemex SAB de CV ADR | 243,638 | 1,455 |
America Movil SAB de CV ADR | 77,575 | 1,288 | |
Qualitas Controladora SAB de CV | 118,414 | 978 | |
Grupo Mexico SAB de CV Series B | 105,863 | 432 | |
Corp. Inmobiliaria Vesta SAB de CV | 67,100 | 210 | |
14,756 | |||
Other (0.4%) | |||
3 | Vanguard FTSE Emerging Markets ETF | 69,223 | 2,626 |
Shares | Market Value• ($000) | ||
Philippines (0.3%) | |||
Bdo Unibank Inc. | 750,153 | 1,689 | |
Ayala Land Inc. | 461,800 | 227 | |
1,916 | |||
Poland (0.3%) | |||
*,1 | Allegro.eu SA | 147,294 | 1,057 |
KGHM Polska Miedz SA | 34,440 | 919 | |
1,976 | |||
Romania (0.2%) | |||
Banca Transilvania SA | 265,270 | 1,258 | |
Russia (0.0%) | |||
*,4 | MMC Norilsk Nickel PJSC ADR | 200,203 | — |
4 | Sberbank of Russia PJSC | 1,473,153 | — |
*,4 | Mobile TeleSystems PJSC ADR | 93,946 | — |
4 | Moscow Exchange MICEX-RTS PJSC | 536,630 | — |
*,4 | MMC Norilsk Nickel PJSC | 1,247 | — |
*,4 | Sberbank of Russia PJSC ADR | 476,234 | — |
*,4 | LUKOIL PJSC ADR | 102,385 | — |
*,4 | Novatek PJSC GDR (Registered) | 6,724 | — |
*,2,4 | Ozon Holdings plc ADR | 35,000 | — |
*,4 | Gazprom PJSC | 926,846 | — |
— | |||
Saudi Arabia (1.3%) | |||
1 | Saudi Arabian Oil Co. | 495,859 | 4,405 |
Saudi Awwal Bank | 251,544 | 2,246 | |
Al Rajhi Bank | 91,085 | 1,631 | |
Saudi Telecom Co. | 67,821 | 695 | |
Mouwasat Medical Services Co. | 10,024 | 267 | |
9,244 | |||
Singapore (0.6%) | |||
Wilmar International Ltd. | 1,612,000 | 4,191 | |
South Africa (2.1%) | |||
2 | Anglogold Ashanti plc | 258,722 | 4,616 |
Sasol Ltd. | 342,139 | 4,325 | |
Impala Platinum Holdings Ltd. | 310,240 | 1,292 | |
FirstRand Ltd. | 315,005 | 1,039 | |
Mr Price Group Ltd. | 115,117 | 832 | |
Discovery Ltd. | 100,531 | 693 | |
* | Naspers Ltd. Class N | 3,878 | 606 |
Harmony Gold Mining Co. Ltd. | 131,116 | 601 | |
Thungela Resources Ltd. | 58,639 | 520 | |
Gold Fields Ltd. | 38,082 | 502 | |
15,026 | |||
South Korea (5.6%) | |||
Samsung Electronics Co. Ltd. (XKRX) | 296,238 | 14,745 | |
SK Hynix Inc. | 79,807 | 6,931 | |
Hankook Tire & Technology Co. Ltd. | 136,687 | 3,878 | |
LG Chem Ltd. (XKRX) | 9,293 | 3,046 | |
Hyundai Motor Co. | 23,036 | 2,902 | |
DB Insurance Co. Ltd. | 43,341 | 2,820 | |
Shinhan Financial Group Co. Ltd. | 53,870 | 1,385 |
Shares | Market Value• ($000) | ||
Samsung SDI Co. Ltd. (XKRX) | 3,915 | 1,240 | |
WONIK IPS Co. Ltd. | 52,731 | 1,179 | |
KB Financial Group Inc. | 26,800 | 1,021 | |
NAVER Corp. | 4,531 | 633 | |
39,780 | |||
Spain (0.2%) | |||
Banco Bilbao Vizcaya Argentaria SA. ADR | 224,508 | 1,758 | |
Taiwan (10.4%) | |||
Taiwan Semiconductor Manufacturing Co. Ltd. (XTAI) | 2,709,627 | 44,255 | |
Hon Hai Precision Industry Co. Ltd. | 1,870,685 | 5,583 | |
MediaTek Inc. | 180,227 | 4,704 | |
Accton Technology Corp. | 206,000 | 3,192 | |
United Integrated Services Co. Ltd. | 409,000 | 3,036 | |
Compal Electronics Inc. | 2,531,000 | 2,202 | |
Nanya Technology Corp. | 1,013,000 | 2,031 | |
E Ink Holdings Inc. | 303,000 | 1,576 | |
Silergy Corp. | 146,000 | 1,305 | |
ASPEED Technology Inc. | 16,284 | 1,301 | |
Chroma ATE Inc. | 191,144 | 1,292 | |
Airtac International Group | 38,799 | 1,276 | |
Evergreen Marine Corp. Taiwan Ltd. | 344,348 | 1,146 | |
Realtek Semiconductor Corp. | 79,000 | 985 | |
73,884 | |||
Thailand (2.8%) | |||
PTT Exploration & Production PCL | 1,122,210 | 5,125 | |
SCB X PCL | 1,640,500 | 4,498 | |
Charoen Pokphand Foods PCL | 5,819,800 | 3,027 | |
Bangkok Bank PCL NVDR | 469,100 | 2,055 | |
Kasikornbank PCL NVDR | 455,579 | 1,666 | |
Indorama Ventures PCL NVDR | 2,082,900 | 1,372 | |
Bangkok Bank PCL (Registered) | 215,800 | 946 | |
Kasikornbank PCL | 197,153 | 721 | |
Bangkok Dusit Medical Services PCL Class F | 349,600 | 258 | |
Central Pattana PCL | 100,470 | 175 | |
19,843 | |||
Turkey (0.3%) | |||
Akbank TAS | 2,133,100 | 2,222 | |
United Arab Emirates (0.7%) | |||
Abu Dhabi Commercial Bank PJSC | 1,587,605 | 3,469 | |
Emirates NBD Bank PJSC | 226,034 | 1,043 | |
Emaar Properties PJSC | 255,038 | 465 | |
4,977 | |||
United Kingdom (1.3%) | |||
Standard Chartered plc | 727,225 | 5,576 | |
1 | Airtel Africa plc | 1,076,448 | 1,483 |
Fresnillo plc | 201,336 | 1,355 | |
Anglo American plc | 38,737 | 987 |
Shares | Market Value• ($000) | ||
Hikma Pharmaceuticals plc | 7,962 | 184 | |
9,585 | |||
United States (4.7%) | |||
* | MercadoLibre Inc. | 5,567 | 6,907 |
Credicorp Ltd. | 49,655 | 6,205 | |
Freeport-McMoRan Inc. | 126,596 | 4,276 | |
Cognizant Technology Solutions Corp. Class A | 51,280 | 3,306 | |
* | Flex Ltd. | 84,985 | 2,186 |
* | Coupang Inc. | 126,396 | 2,149 |
Ternium SA ADR | 41,505 | 1,556 | |
Copa Holdings SA Class A | 18,416 | 1,504 | |
* | Sea Ltd. ADR | 32,952 | 1,374 |
* | Fabrinet | 8,584 | 1,331 |
* | MakeMyTrip Ltd. | 24,309 | 941 |
* | WNS Holdings Ltd. ADR | 14,106 | 766 |
Patria Investments Ltd. Class A | 48,769 | 629 | |
33,130 | |||
Vietnam (0.4%) | |||
Vietnam Dairy Products JSC | 1,137,100 | 3,149 | |
*,1 | Vinhomes JSC | 38,300 | 61 |
3,210 | |||
Total Common Stocks (Cost $684,130) | 654,206 | ||
Preferred Stocks (2.7%) | |||
Cia Energetica de Minas Gerais Preference Shares | 1,657,065 | 3,859 | |
Petroleo Brasileiro SA Preference Shares | 490,700 | 3,381 | |
Raizen SA Preference Shares | 4,460,835 | 3,212 | |
Banco Bradesco SA Preference Shares | 1,027,100 | 2,850 | |
Samsung Electronics Co. Ltd. Preference Shares | 69,261 | 2,765 |
Shares | Market Value• ($000) | ||
Itau Unibanco Holding SA Preference Shares | 419,200 | 2,230 | |
* | Braskem SA Preference Shares Class A | 183,937 | 586 |
Total Preferred Stocks (Cost $19,779) | 18,883 | ||
Temporary Cash Investments (5.8%) | |||
Money Market Fund (5.8%) | |||
5,6 | Vanguard Market Liquidity Fund, 5.420% (Cost $40,936) | 409,473 | 40,943 |
Total Investments (100.8%) (Cost $744,845) | 714,032 | ||
Other Assets and Liabilities— Net (-0.8%) | (5,460) | ||
Net Assets (100%) | 708,572 | ||
Cost is in $000. |
• | See Note A in Notes to Financial Statements. |
* | Non-income-producing security. |
1 | Security exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2023, the aggregate value was $26,643,000, representing 3.8% of net assets. |
2 | Includes partial security positions on loan to broker-dealers. The total value of securities on loan is $5,210,000. |
3 | Considered an affiliated company of the fund as the issuer is another member of The Vanguard Group. |
4 | Security value determined using significant unobservable inputs. |
5 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
6 | Collateral of $6,026,000 was received for securities on loan. |
ADR—American Depositary Receipt. | |
GDR—Global Depositary Receipt. | |
NVDR—Non-Voting Depository Receipt. |
Futures Contracts | ||||
($000) | ||||
Expiration | Number of Long (Short) Contracts | Notional Amount | Value and Unrealized Appreciation (Depreciation) | |
Long Futures Contracts | ||||
MSCI Emerging Markets Index | December 2023 | 588 | 27,024 | (1,769) |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $701,231) | 670,463 |
Affiliated Issuers (Cost $43,614) | 43,569 |
Total Investments in Securities | 714,032 |
Investment in Vanguard | 26 |
Cash | 2,627 |
Cash Collateral Pledged—Futures Contracts | 797 |
Foreign Currency, at Value (Cost $471) | 509 |
Receivables for Investment Securities Sold | 741 |
Receivables for Accrued Income | 2,059 |
Receivables for Capital Shares Issued | 174 |
Total Assets | 720,965 |
Liabilities | |
Payables for Investment Securities Purchased | 3,353 |
Collateral for Securities on Loan | 6,026 |
Payables to Investment Advisor | 910 |
Payables for Capital Shares Redeemed | 219 |
Payables to Vanguard | 94 |
Variation Margin Payable—Futures Contracts | 179 |
Foreign Capital Gain Taxes Payable | 3 |
Deferred Foreign Capital Gains Taxes | 1,609 |
Total Liabilities | 12,393 |
Net Assets | 708,572 |
1 Includes $5,210,000 of securities on loan. | |
At October 31, 2023, net assets consisted of: | |
Paid-in Capital | 799,676 |
Total Distributable Earnings (Loss) | (91,104) |
Net Assets | 708,572 |
Net Assets | |
Applicable to 36,655,025 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 708,572 |
Net Asset Value Per Share | $19.33 |
Year Ended October 31, 2023 | |
($000) | |
Investment Income | |
Income | |
Dividends—Unaffiliated Issuers1 | 24,889 |
Dividends—Affiliated Issuers | 218 |
Non-Cash Dividends | 1,444 |
Interest—Unaffiliated Issuers | 48 |
Interest—Affiliated Issuers | 1,920 |
Securities Lending—Net | 55 |
Total Income | 28,574 |
Expenses | |
Investment Advisory Fees—Note B | |
Basic Fee | 3,895 |
Performance Adjustment | (103) |
The Vanguard Group—Note C | |
Management and Administrative | 1,954 |
Marketing and Distribution | 45 |
Custodian Fees | 160 |
Auditing Fees | 38 |
Shareholders’ Reports | 40 |
Trustees’ Fees and Expenses | — |
Other Expenses | 23 |
Total Expenses | 6,052 |
Expenses Paid Indirectly | (1) |
Net Expenses | 6,051 |
Net Investment Income | 22,523 |
Realized Net Gain (Loss) | |
Capital Gains Distributions Received – Affiliated Issuers | — |
Investment Securities Sold—Unaffiliated Issuers2 | (11,158) |
Investment Securities Sold—Affiliated Issuers | (489) |
Futures Contracts | (286) |
Forward Currency Contracts | 12 |
Foreign Currencies | (349) |
Realized Net Gain (Loss) | (12,270) |
Statement of Operations (continued) | |
Year Ended October 31, 2023 | |
($000) | |
Change in Unrealized Appreciation (Depreciation) | |
Investment Securities—Unaffiliated Issuers3 | 82,396 |
Investment Securities—Affiliated Issuers | 1,141 |
Futures Contracts | 245 |
Foreign Currencies | 21 |
Change in Unrealized Appreciation (Depreciation) | 83,803 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 94,056 |
1 | Dividends are net of foreign withholding taxes of $2,757,000. |
2 | Realized gain (loss) is net of foreign capital gain taxes of $1,221,000. |
3 | The change in unrealized appreciation (depreciation) is net of the change in deferred foreign capital gains taxes of $105,000. |
Year Ended October 31, | ||
2023 ($000) | 2022 ($000) | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net Investment Income | 22,523 | 26,378 |
Realized Net Gain (Loss) | (12,270) | (59,867) |
Change in Unrealized Appreciation (Depreciation) | 83,803 | (261,612) |
Net Increase (Decrease) in Net Assets Resulting from Operations | 94,056 | (295,101) |
Distributions | ||
Total Distributions | (25,482) | (59,107) |
Capital Share Transactions | ||
Issued | 141,225 | 179,568 |
Issued in Lieu of Cash Distributions | 21,665 | 50,609 |
Redeemed | (152,294) | (220,976) |
Net Increase (Decrease) from Capital Share Transactions | 10,596 | 9,201 |
Total Increase (Decrease) | 79,170 | (345,007) |
Net Assets | ||
Beginning of Period | 629,402 | 974,409 |
End of Period | 708,572 | 629,402 |
For a Share Outstanding Throughout Each Period | Year Ended October 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | |
Net Asset Value, Beginning of Period | $17.42 | $27.09 | $22.18 | $21.87 | $19.68 |
Investment Operations | |||||
Net Investment Income1 | .606 | .715 | .457 | .298 | .4742 |
Net Realized and Unrealized Gain (Loss) on Investments | 2.019 | (8.724) | 4.729 | .483 | 2.208 |
Total from Investment Operations | 2.625 | (8.009) | 5.186 | .781 | 2.682 |
Distributions | |||||
Dividends from Net Investment Income | (.715) | (.486) | (.276) | (.471) | (.492) |
Distributions from Realized Capital Gains | — | (1.175) | — | — | — |
Total Distributions | (.715) | (1.661) | (.276) | (.471) | (.492) |
Net Asset Value, End of Period | $19.33 | $17.42 | $27.09 | $22.18 | $21.87 |
Total Return3 | 15.10% | -31.16% | 23.44% | 3.51% | 13.96% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $709 | $629 | $974 | $670 | $702 |
Ratio of Total Expenses to Average Net Assets4 | 0.80%5 | 0.78% | 0.84% | 0.85% | 0.93% |
Ratio of Net Investment Income to Average Net Assets | 2.99% | 3.26% | 1.65% | 1.43% | 2.25%2 |
Portfolio Turnover Rate | 43% | 41% | 48% | 52% | 46% |
1 | Calculated based on average shares outstanding. |
2 | Net investment income per share and the ratio of net investment income to average net assets include $0.071 and 0.34%, respectively, resulting from a special dividend from Naspers Ltd. in September 2019. |
3 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
4 | Includes performance-based investment advisory fee increases (decreases) of (0.01%), (0.04%), 0.02%, (0.01%), and 0.07%. |
5 | The ratio of expenses to average net assets for the period net of reduction from broker commission abatement arrangements was 0.80%. |
A. | The following significant accounting policies conform to generally accepted accounting principles for U.S. investment companies. The fund consistently follows such policies in preparing its financial statements. |
B. | The investment advisory firms Pzena Investment Management, LLC, Baillie Gifford Overseas Ltd., Oaktree Fund Advisors, LLC, and Wellington Management Company llp, each provide investment advisory services to a portion of the fund for a fee calculated at an annual percentage rate of average net assets managed by the advisor. The basic fees of Pzena Investment Management, LLC, Baillie Gifford Overseas Ltd., Oaktree Fund Advisors, LLC, and Wellington Management Company llp, are subject to quarterly adjustments based on performance relative to the FTSE Emerging Index for the preceding three years. |
C. | In accordance with the terms of a Funds' Service Agreement (the “FSA”) between Vanguard and the fund, Vanguard furnishes to the fund corporate management, administrative, marketing, distribution and cash management services at Vanguard’s cost of operations (as defined by the FSA). These costs of operations are allocated to the fund based on methods and guidelines approved by the board of trustees and are generally settled twice a month. |
D. | The fund has asked its investment advisors to direct certain security trades, subject to obtaining the best price and execution, to brokers who have agreed to rebate to the fund part of the commissions generated. Such rebates are used solely to reduce the fund’s management and administrative expenses. For the year ended October 31, 2023, these arrangements reduced the fund’s expenses by $1,000 (an annual rate of less than 0.01% of average net assets). |
E. | Various inputs may be used to determine the value of the fund’s investments and derivatives. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities. |
Level 1 ($000) | Level 2 ($000) | Level 3 ($000) | Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks—North and South America | 116,903 | 1,145 | — | 118,048 |
Common Stocks—Other | 29,021 | 507,137 | — | 536,158 |
Preferred Stocks | 16,118 | 2,765 | — | 18,883 |
Temporary Cash Investments | 40,943 | — | — | 40,943 |
Total | 202,985 | 511,047 | — | 714,032 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Futures Contracts1 | 1,769 | — | — | 1,769 |
1 | Includes cumulative appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
F. | At October 31, 2023, the fair values of derivatives were reflected in the Statement of Assets and Liabilities as follows: |
Statement of Assets and Liabilities | Equity Contracts ($000) | Foreign Exchange Contracts ($000) | Total ($000) |
Unrealized Depreciation—Futures Contracts1 | 1,769 | — | 1,769 |
1 | Includes cumulative appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
Realized Net Gain (Loss) on Derivatives | Equity Contracts ($000) | Foreign Exchange Contracts ($000) | Total ($000) |
Futures Contracts | (286) | — | (286) |
Forward Currency Contracts | — | 12 | 12 |
Realized Net Gain (Loss) on Derivatives | (286) | 12 | (274) |
Change in Unrealized Appreciation (Depreciation) on Derivatives | |||
Futures Contracts | 245 | — | 245 |
G. | Permanent differences between book-basis and tax-basis components of net assets are reclassified among capital accounts in the financial statements to reflect their tax character. These reclassifications have no effect on net assets or net asset value per share. As of period end, permanent differences primarily attributable to the accounting for applicable foreign currency transactions, passive foreign investment companies, and tax expense on capital gains were reclassified between the individual components of total distributable earnings (loss). |
Amount ($000) | |
Undistributed Ordinary Income | 19,302 |
Undistributed Long-Term Gains | — |
Net Unrealized Gains (Losses) | (46,223) |
Capital Loss Carryforwards | (64,183) |
Qualified Late-Year Losses | — |
Other Temporary Differences | — |
Total | (91,104) |
Year Ended October 31, | ||
2023 Amount ($000) | 2022 Amount ($000) | |
Ordinary Income* | 25,482 | 32,782 |
Long-Term Capital Gains | — | 26,325 |
Total | 25,482 | 59,107 |
* | Includes short-term capital gains, if any. |
Amount ($000) | |
Tax Cost | 758,681 |
Gross Unrealized Appreciation | 101,044 |
Gross Unrealized Depreciation | (145,694) |
Net Unrealized Appreciation (Depreciation) | (44,650) |
H. | During the year ended October 31, 2023, the fund purchased $304,537,000 of investment securities and sold $301,069,000 of investment securities, other than temporary cash investments. |
I. | Capital shares issued and redeemed were: |
Year Ended October 31, | ||
2023 Shares (000) | 2022 Shares (000) | |
Issued | 6,947 | 8,139 |
Issued in Lieu of Cash Distributions | 1,130 | 2,150 |
Redeemed | (7,545) | (10,131) |
Net Increase (Decrease) in Shares Outstanding | 532 | 158 |
J. | Transactions during the period in investments where the issuer is another member of The Vanguard Group were as follows: |
Current Period Transactions | ||||||||
Oct. 31, 2022 Market Value ($000) | Purchases at Cost ($000) | Proceeds from Securities Sold ($000) | Realized Net Gain (Loss) ($000) | Change in Unrealized App. (Dep.) ($000) | Income ($000) | Capital Gain Distributions Received ($000) | Oct. 31, 2023 Market Value ($000) | |
Vanguard FTSE Emerging Markets ETF | 5,342 | 14,034 | 17,399 | (491) | 1,140 | 218 | — | 2,626 |
Vanguard Market Liquidity Fund | 27,141 | NA1 | NA1 | 2 | 1 | 1,920 | — | 40,943 |
Total | 32,483 | 14,034 | 17,399 | (489) | 1,141 | 2,138 | — | 43,569 |
1 | Not applicable—purchases and sales are for temporary cash investment purposes. |
K. | Significant market disruptions, such as those caused by pandemics (e.g., COVID-19 pandemic), natural or environmental disasters, war (e.g., Russia’s invasion of Ukraine), acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
L. | Management has determined that no events or transactions occurred subsequent to October 31, 2023, that would require recognition or disclosure in these financial statements. |
Philadelphia, Pennsylvania
December 19, 2023
Matthew Benchener | Thomas M. Rampulla |
Joseph Brennan | Karin A. Risi |
Mortimer J. Buckley | Anne E. Robinson |
Gregory Davis | Michael Rollings |
John James | Nitin Tandon |
Chris D. Mclsaac | Lauren Valente |
All rights reserved.
Vanguard Marketing Corporation, Distributor.
Your Fund’s Performance at a Glance | 1 |
Advisors' Report | 2 |
About Your Fund’s Expenses | 4 |
Performance Summary | 6 |
Consolidated Financial Statements | 8 |
• | For the 12 months ended October 31, 2023, Vanguard Commodity Strategy Fund returned –3.03%, just short of the –2.97% return of its benchmark, the Bloomberg Commodity Index Total Return. |
• | Early on, inflation in many developed markets eased off multidecade highs amid ongoing interest rate hikes by central banks. Unexpected resilience in labor markets and consumer spending helped dial back expectations of a sustained global recession, but the prospect of higher interest rates for longer and heightened geopolitical tensions weighed on market sentiment toward the close of the period. |
• | The performance of commodities was mixed. West Texas Intermediate Crude and most grain prices fell. Gold and other precious metals rose. |
• | The fund underperformed largely because of its exposure to short-term Treasury Inflation-Protected Securities as the market continued to price in higher inflation and real yields rose. |
• | The fund uses derivatives to obtain its exposure to commodities. Its holdings of commodity index futures and swaps had a net negative impact on returns. |
Average Annual Total Returns Periods Ended October 31, 2023 | |||
One Year | Three Years | Five Years | |
Stocks | |||
Russell 1000 Index (Large-caps) | 9.48% | 9.53% | 10.71% |
Russell 2000 Index (Small-caps) | -8.56 | 3.95 | 3.31 |
Russell 3000 Index (Broad U.S. market) | 8.38 | 9.19 | 10.23 |
FTSE All-World ex US Index (International) | 12.35 | 3.51 | 3.88 |
Bonds | |||
Bloomberg U.S. Aggregate Float Adjusted Index (Broad taxable market) | 0.53% | -5.51% | 0.03% |
Bloomberg Municipal Bond Index (Broad tax-exempt market) | 2.64 | -2.48 | 1.00 |
FTSE Three-Month U.S. Treasury Bill Index | 4.94 | 1.93 | 1.80 |
CPI | |||
Consumer Price Index | 3.24% | 5.72% | 4.00% |
Vanguard Quantitative Equity Group
Vanguard Fixed Income Group
• | Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund‘s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. |
• | Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds. |
Six Months Ended October 31, 2023 | |||
Commodity Strategy Fund | Beginning Account Value 4/30/2023 | Ending Account Value 10/31/2023 | Expenses Paid During Period |
Based on Actual Fund Return | $1,000.00 | $994.60 | $1.06 |
Based on Hypothetical 5% Yearly Return | 1,000.00 | 1,024.15 | 1.07 |
Average Annual Total Returns Periods Ended October 31, 2023 | ||||
One Year | Since Inception (6/25/2019) | Final Value of a $50,000 Investment | ||
Commodity Strategy Fund | -3.03% | 11.20% | $79,352 | |
Bloomberg Commodity Index Total Return | -2.97 | 8.32 | 70,780 |
U.S. Government Securities | 100.0% |
Coupon | Maturity Date | Face Amount ($000) | Market Value• ($000) | |||
U.S. Government and Agency Obligations (74.3%) | ||||||
U.S. Government Securities (74.3%) | ||||||
United States Treasury Inflation Indexed Bonds | 0.625% | 1/15/24 | 70,224 | 69,588 | ||
United States Treasury Inflation Indexed Bonds | 0.500% | 4/15/24 | 39,432 | 38,767 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 7/15/24 | 63,761 | 62,296 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 10/15/24 | 56,875 | 55,187 | ||
United States Treasury Inflation Indexed Bonds | 0.250% | 1/15/25 | 58,308 | 56,149 | ||
United States Treasury Inflation Indexed Bonds | 2.375% | 1/15/25 | 39,743 | 39,252 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 4/15/25 | 46,591 | 44,487 | ||
United States Treasury Inflation Indexed Bonds | 0.375% | 7/15/25 | 63,939 | 61,251 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 10/15/25 | 56,684 | 53,770 | ||
United States Treasury Inflation Indexed Bonds | 0.625% | 1/15/26 | 53,832 | 51,208 | ||
United States Treasury Inflation Indexed Bonds | 2.000% | 1/15/26 | 25,650 | 25,141 | ||
United States Treasury Inflation Indexed Bonds | ��� 0.125% | 4/15/26 | 43,779 | 40,933 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 7/15/26 | 53,655 | 50,159 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 10/15/26 | 60,588 | 56,309 | ||
United States Treasury Inflation Indexed Bonds | 0.375% | 1/15/27 | 49,966 | 46,421 | ||
United States Treasury Inflation Indexed Bonds | 2.375% | 1/15/27 | 24,799 | 24,543 | ||
United States Treasury Inflation Indexed Bonds | 0.125% | 4/15/27 | 61,893 | 56,671 | ||
United States Treasury Inflation Indexed Bonds | 0.375% | 7/15/27 | 55,086 | 50,929 | ||
United States Treasury Inflation Indexed Bonds | 1.625% | 10/15/27 | 62,066 | 59,971 | ||
United States Treasury Inflation Indexed Bonds | 0.500% | 1/15/28 | 56,255 | 51,623 | ||
United States Treasury Inflation Indexed Bonds | 1.750% | 1/15/28 | 23,314 | 22,520 | ||
United States Treasury Inflation Indexed Bonds | 1.250% | 4/15/28 | 61,293 | 57,921 | ||
United States Treasury Inflation Indexed Bonds | 3.625% | 4/15/28 | 23,869 | 24,880 | ||
United States Treasury Inflation Indexed Bonds | 0.750% | 7/15/28 | 48,963 | 45,291 | ||
United States Treasury Inflation Indexed Bonds | 2.375% | 10/15/28 | 32,778 | 32,671 | ||
Total U.S. Government and Agency Obligations (Cost $1,250,259) | 1,177,938 | |||||
Shares | ||||||
Temporary Cash Investments (24.3%) | ||||||
Money Market Fund (4.9%) | ||||||
1 | Vanguard Market Liquidity Fund | 5.420% | 781,312 | 78,123 |
Coupon | Maturity Date | Face Amount ($000) | Market Value• ($000) | |||
U.S. Government and Agency Obligations (19.4%) | ||||||
2 | United States Treasury Bill | 5.228% | 11/2/23 | 19,400 | 19,397 | |
2 | United States Treasury Bill | 5.141% | 11/14/23 | 7,400 | 7,386 | |
2 | United States Treasury Bill | 5.366% | 11/24/23 | 35,000 | 34,882 | |
2 | United States Treasury Bill | 5.342%–5.387% | 11/30/23 | 47,400 | 47,198 | |
2 | United States Treasury Bill | 5.370% | 12/12/23 | 14,900 | 14,810 | |
2,3 | United States Treasury Bill | 5.383% | 12/19/23 | 27,100 | 26,908 | |
2 | United States Treasury Bill | 5.405% | 12/21/23 | 51,000 | 50,624 | |
2 | United States Treasury Bill | 5.423% | 12/28/23 | 2,200 | 2,181 | |
2,3 | United States Treasury Bill | 5.462% | 1/9/24 | 56,400 | 55,829 | |
2,3 | United States Treasury Bill | 5.416% | 1/18/24 | 31,000 | 30,643 | |
2,3 | United States Treasury Bill | 5.389% | 1/25/24 | 16,700 | 16,490 | |
306,348 | ||||||
Total Temporary Cash Investments (Cost $384,451) | 384,471 | |||||
Total Investments (98.6%) (Cost $1,634,710) | 1,562,409 | |||||
Other Assets and Liabilities—Net (1.4%) | 21,487 | |||||
Net Assets (100%) | 1,583,896 | |||||
Cost is in $000. |
• | See Note A in Notes to Consolidated Financial Statements. |
1 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
2 | Security is owned by the Vanguard CSF Portfolio, which is a wholly owned subsidiary of the Commodity Strategy Fund. |
3 | Securities with a value of $4,527,000 have been segregated as collateral for open over-the-counter swap contracts. |
Over-the-Counter Total Return Swaps | ||||||
Reference Entity | Termination Date | Counterparty | Notional Amount ($000) | Fixed Interest Rate Received (Paid)1 (%) | Value and Unrealized Appreciation ($000) | Value and Unrealized (Depreciation) ($000) |
Bloomberg Commodity Index2 | 11/2/23 | BANA | 105,000 | (0.060) | 3,064 | — |
Bloomberg Commodity Index2 | 11/16/23 | BARC | 10,000 | (0.100) | — | (138) |
Bloomberg Commodity Index 2 Month Forward2 | 11/16/23 | BARC | 140,000 | (0.110) | — | (1,701) |
Bloomberg Commodity Index 3 Month Forward2 | 11/21/23 | GSI | 20,000 | (0.120) | 13 | — |
BofA Merrill Lynch Commodity MLBXAKSV Excess Return Strategy2,3 | 11/2/23 | BANA | 50,000 | (0.170) | 864 | — |
BofA Merrill Lynch Commodity MLBXSTGV Excess Return Strategy2,3 | 11/2/23 | BANA | 230,000 | (0.110) | 6,714 | — |
BofA Merrill Lynch Commodity MLCILP3E Excess Return Strategy2,3 | 11/2/23 | BANA | 240,000 | (0.140) | 6,736 | — |
Over-the-Counter Total Return Swaps (continued) | ||||||
Reference Entity | Termination Date | Counterparty | Notional Amount ($000) | Fixed Interest Rate Received (Paid)1 (%) | Value and Unrealized Appreciation ($000) | Value and Unrealized (Depreciation) ($000) |
CIBC Commodity CIBZC51EC Excess Return Strategy2,3 | 11/2/23 | CIBC | 170,000 | (0.160) | 4,957 | — |
Goldman Sachs Commodity i-Select Strategy 11292,3 | 11/21/23 | GSI | 220,000 | (0.120) | 140 | — |
Macquarie Commodity MQCP170E Excess Return Strategy2,3 | 11/16/23 | MACQ | 100,000 | (0.150) | — | (1,214) |
Modified Strategy DBS18 on the Bloomberg Commodity Index2,3 | 11/21/23 | GSI | 30,000 | (0.120) | 6 | — |
RBC Commodity RBCACB23 Excess Return Strategy2,3 | 11/16/23 | RBC | 80,000 | (0.130) | — | (897) |
RBC Commodity RBCSVBW1 Excess Return Strategy2,3 | 11/16/23 | RBC | 45,000 | (0.160) | — | (174) |
Societe Generale Commodity SGIXCSB1 Excess Return Strategy2,3 | 11/2/23 | SOCG | 130,000 | (0.170) | 3,941 | — |
26,435 | (4,124) |
1 | Fixed interest payment received/paid monthly. |
2 | Security is owned by the subsidiary. |
3 | Information on the components of the reference entity is available on www.vanguard.com. |
BANA—Bank of America, N.A. | |
BARC—Barclays Bank plc. | |
CIBC—Canadian Imperial Bank of Commerce. | |
GSI—Goldman Sachs International. | |
MACQ—Macquarie Bank Ltd. | |
RBC—Royal Bank of Canada. | |
SOCG—Société Generale. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value | |
Unaffiliated Issuers (Cost $1,556,606) | 1,484,286 |
Affiliated Issuers (Cost $78,104) | 78,123 |
Total Investments in Securities | 1,562,409 |
Investment in Vanguard | 55 |
Cash | 133 |
Receivables for Investment Securities Sold | 31,323 |
Receivables for Accrued Income | 2,023 |
Receivables for Capital Shares Issued | 734 |
Unrealized Appreciation—Over-the-Counter Swap Contracts | 26,435 |
Total Assets | 1,623,112 |
Liabilities | |
Payables for Investment Securities Purchased | 33,118 |
Payables for Capital Shares Redeemed | 1,815 |
Payables to Vanguard | 159 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 4,124 |
Total Liabilities | 39,216 |
Net Assets | 1,583,896 |
At October 31, 2023, net assets consisted of: | |
Paid-in Capital | 1,678,449 |
Total Distributable Earnings (Loss) | (94,553) |
Net Assets | 1,583,896 |
Net Assets | |
Applicable to 60,876,048 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 1,583,896 |
Net Asset Value Per Share | $26.02 |
Year Ended October 31, 2023 | |
($000) | |
Investment Income | |
Income | |
Interest1 | 58,648 |
Total Income | 58,648 |
Expenses | |
The Vanguard Group—Note B | |
Investment Advisory Services | 152 |
Management and Administrative | 3,255 |
Marketing and Distribution | 98 |
Custodian Fees | 46 |
Auditing Fees | 52 |
Shareholders’ Reports | 59 |
Trustees’ Fees and Expenses—Note B | 15 |
Other Expenses | 15 |
Total Expenses | 3,692 |
Expenses Paid Indirectly | (24) |
Net Expenses | 3,668 |
Net Investment Income | 54,980 |
Realized Net Gain (Loss) | |
Investment Securities Sold1 | (33,642) |
Futures Contracts | (24) |
Swap Contracts | (159,258) |
Realized Net Gain (Loss) | (192,924) |
Change in Unrealized Appreciation (Depreciation) | |
Investment Securities1 | 33,534 |
Swap Contracts | 44,859 |
Change in Unrealized Appreciation (Depreciation) | 78,393 |
Net Increase (Decrease) in Net Assets Resulting from Operations | (59,551) |
1 | Interest income, realized net gain (loss), capital gain distributions received, and change in unrealized appreciation (depreciation) from an affiliated company of the fund were $5,621,000, ($15,000), $1,000, and $7,000, respectively. Purchases and sales are for temporary cash investment purposes. |
Year Ended October 31, | ||
2023 ($000) | 2022 ($000) | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net Investment Income | 54,980 | 94,414 |
Realized Net Gain (Loss) | (192,924) | 131,973 |
Change in Unrealized Appreciation (Depreciation) | 78,393 | (123,543) |
Net Increase (Decrease) in Net Assets Resulting from Operations | (59,551) | 102,844 |
Distributions | ||
Total Distributions | (244,178) | (390,043) |
Capital Share Transactions | ||
Issued | 780,178 | 1,800,077 |
Issued in Lieu of Cash Distributions | 186,091 | 271,967 |
Redeemed | (1,072,899) | (1,476,116) |
Net Increase (Decrease) from Capital Share Transactions | (106,630) | 595,928 |
Total Increase (Decrease) | (410,359) | 308,729 |
Net Assets | ||
Beginning of Period | 1,994,255 | 1,685,526 |
End of Period | 1,583,896 | 1,994,255 |
For a Share Outstanding Throughout Each Period | June 25 20191to October 31, 2019 | Year Ended October 31, | |||
2023 | 2022 | 2021 | 2020 | ||
Net Asset Value, Beginning of Period | $30.69 | $36.85 | $24.32 | $24.83 | $25.00 |
Investment Operations | |||||
Net Investment Income2 | .826 | 1.474 | .890 | .265 | .143 |
Net Realized and Unrealized Gain (Loss) on Investments | (1.612) | .751 | 11.774 | (.620) | (.313) |
Total from Investment Operations | (.786) | 2.225 | 12.664 | (.355) | (.170) |
Distributions | |||||
Dividends from Net Investment Income | (3.884) | (8.385) | (.134) | (.155) | — |
Distributions from Realized Capital Gains | — | — | — | — | — |
Total Distributions | (3.884) | (8.385) | (.134) | (.155) | — |
Net Asset Value, End of Period | $26.02 | $30.69 | $36.85 | $24.32 | $24.83 |
Total Return3 | -3.03% | 9.80% | 52.30% | -1.45% | -0.68% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $1,584 | $1,994 | $1,686 | $373 | $207 |
Ratio of Total Expenses to Average Net Assets | 0.21%4 | 0.21%4 | 0.20% | 0.20% | 0.20%5 |
Ratio of Net Investment Income to Average Net Assets | 3.08% | 4.47% | 2.79% | 1.15% | 1.65%5 |
Portfolio Turnover Rate | 30% | 47% | 15% | 38% | 7% |
1 | Inception. |
2 | Calculated based on average shares outstanding. |
3 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
4 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.21%. |
5 | Annualized. |
A. | The following significant accounting policies conform to generally accepted accounting principles for U.S. investment companies. The fund consistently follows such policies in preparing its financial statements. |
Assets Reflected in Consolidated Statement of Assets and Liabilities1 ($000) | Liabilities Reflected in Consolidated Statement of Assets and Liabilities1 ($000) | Net Amount Receivable (Payable) ($000) | Amounts Not Offset in the Consolidated Statement of Assets and Liabilities | Net Exposure3 (Not Less Than $0) ($000) | ||
Collateral Pledged2 ($000) | Collateral Received2 ($000) | |||||
Derivatives Subject to Offsetting Arrangements, by Counterparty | ||||||
Bank of America, N.A. | 17,378 | — | 17,378 | — | 17,554 | — |
Barclays Bank plc | — | (1,839) | (1,839) | 2,035 | — | — |
Canadian Imperial Bank of Commerce | 4,957 | — | 4,957 | — | 5,019 | — |
Goldman Sachs International | 159 | — | 159 | 112 | — | 159 |
Macquarie Bank Ltd. | — | (1,214) | (1,214) | 1,344 | — | — |
Royal Bank of Canada | — | (1,071) | (1,071) | 1,036 | — | — |
Société Generale | 3,941 | — | 3,941 | — | 3,735 | 206 |
Total | 26,435 | (4,124) | 22,311 | 4,527 | 26,308 | 365 |
B. | In accordance with the terms of a Funds' Service Agreement (the “FSA”) between Vanguard and the fund, Vanguard furnishes to the fund investment advisory, corporate management, administrative, marketing, and distribution services at Vanguard’s cost of operations (as defined by the FSA). These costs of operations are allocated to the fund based on methods and guidelines approved by the board of trustees and are generally settled twice a month. |
C. | The fund’s custodian bank has agreed to reduce its fees when the fund maintains cash on deposit in the non-interest-bearing custody account. For the year ended October 31, 2023, custodian fee offset arrangements reduced the fund’s expenses by $24,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities. |
Level 1 ($000) | Level 2 ($000) | Level 3 ($000) | Total ($000) | |
Investments | ||||
Assets | ||||
U.S. Government and Agency Obligations | — | 1,177,938 | — | 1,177,938 |
Temporary Cash Investments | 78,123 | 306,348 | — | 384,471 |
Total | 78,123 | 1,484,286 | — | 1,562,409 |
Derivative Financial Instruments | ||||
Assets | ||||
Swap Contracts | — | 26,435 | — | 26,435 |
Liabilities | ||||
Swap Contracts | — | 4,124 | — | 4,124 |
E. | At October 31, 2023, the fair values of derivatives were reflected in the Consolidated Statement of Assets and Liabilities as follows: |
Consolidated Statement of Assets and Liabilities Caption | Commodity Contracts ($000) | Interest Rate Contracts ($000) | Total ($000) |
Unrealized Appreciation— Over-the-Counter Swap Contracts | 26,435 | — | 26,435 |
Unrealized Depreciation— Over-the-Counter Swap Contracts | 4,124 | — | 4,124 |
Realized Net Gain (Loss) on Derivatives | Commodity Contracts ($000) | Interest Rate Contracts ($000) | Total ($000) |
Futures Contracts | — | (24) | (24) |
Swap Contracts | (159,258) | — | (159,258) |
Realized Net Gain (Loss) on Derivatives | (159,258) | (24) | (159,282) |
Change in Unrealized Appreciation (Depreciation) on Derivatives | |||
Swap Contracts | 44,859 | — | 44,859 |
F. | Permanent differences between book-basis and tax-basis components of net assets are reclassified among capital accounts in the financial statements to reflect their tax character. These reclassifications have no effect on net assets or net asset value per share. As of period end, permanent differences primarily attributable to the accounting for applicable operations of the subsidiary were reclassified between the following accounts: |
Amount ($000) | |
Paid-in Capital | (99,965) |
Total Distributable Earnings (Loss) | 99,965 |
Amount ($000) | |
Undistributed Ordinary Income | 34,135 |
Undistributed Long-Term Gains | — |
Net Unrealized Gains (Losses) | (72,385) |
Capital Loss Carryforwards | (56,303) |
Qualified Late-Year Losses | — |
Other Temporary Differences | — |
Total | (94,553) |
Year Ended October 31, | ||
2023 Amount ($000) | 2022 Amount ($000) | |
Ordinary Income* | 244,178 | 390,043 |
Long-Term Capital Gains | — | — |
Total | 244,178 | 390,043 |
* | Includes short-term capital gains, if any. |
Amount ($000) | |
Tax Cost | 1,634,795 |
Gross Unrealized Appreciation | 36,996 |
Gross Unrealized Depreciation | (109,381) |
Net Unrealized Appreciation (Depreciation) | (72,385) |
G. | During the year ended October 31, 2023, the fund purchased $399,638,000 of investment securities and sold $756,615,000 of investment securities, other than temporary cash investments. |
H. | Capital shares issued and redeemed were: |
Year Ended October 31, | ||
2023 Shares (000) | 2022 Shares (000) | |
Issued | 28,765 | 54,611 |
Issued in Lieu of Cash Distributions | 6,887 | 10,325 |
Redeemed | (39,756) | (45,700) |
Net Increase (Decrease) in Shares Outstanding | (4,104) | 19,236 |
I. | Significant market disruptions, such as those caused by pandemics (e.g., COVID-19 pandemic), natural or environmental disasters, war (e.g., Russia’s invasion of Ukraine), acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
J. | Management has determined that no events or transactions occurred subsequent to October 31, 2023, that would require recognition or disclosure in these financial statements. |
Philadelphia, Pennsylvania
December 19, 2023
Matthew Benchener | Thomas M. Rampulla |
Joseph Brennan | Karin A. Risi |
Mortimer J. Buckley | Anne E. Robinson |
Gregory Davis | Michael Rollings |
John James | Nitin Tandon |
Chris D. Mclsaac | Lauren Valente |
All rights reserved.
Vanguard Marketing Corporation, Distributor.
Your Fund’s Performance at a Glance | 1 |
Advisors' Report | 2 |
About Your Fund’s Expenses | 6 |
Performance Summary | 8 |
Financial Statements | 10 |
• | From its inception on November 16, 2022, through October 31, 2023, Vanguard Global Environmental Opportunities Stock Fund returned –12.40% for Investor Shares and –12.28% for Admiral Shares. The fund significantly lagged its benchmark, the MSCI All Country World Index, which returned 5.01% for the same time period. |
• | The fund is a concentrated stock fund focused on broader environmental opportunities with an emphasis on decarbonization. |
• | Early on, inflation in many developed markets eased off multidecade highs amid ongoing interest rate hikes by central banks. Unexpected resilience in labor markets and consumer spending helped dial back expectations of a sustained global recession, but the prospect of higher interest rates for longer and heightened geopolitical tensions weighed on market sentiment toward the close of the period. |
• | Five of the fund’s 11 sectors contributed positively to performance. Health care, financials, and consumer staples produced the strongest results. Information technology, industrials, and utilities were the biggest detractors. |
Average Annual Total Returns Periods Ended October 31, 2023 | |||
One Year | Three Years | Five Years | |
Stocks | |||
Russell 1000 Index (Large-caps) | 9.48% | 9.53% | 10.71% |
Russell 2000 Index (Small-caps) | -8.56 | 3.95 | 3.31 |
Russell 3000 Index (Broad U.S. market) | 8.38 | 9.19 | 10.23 |
FTSE All-World ex US Index (International) | 12.35 | 3.51 | 3.88 |
Bonds | |||
Bloomberg U.S. Aggregate Float Adjusted Index (Broad taxable market) | 0.53% | -5.51% | 0.03% |
Bloomberg Municipal Bond Index (Broad tax-exempt market) | 2.64 | -2.48 | 1.00 |
FTSE Three-Month U.S. Treasury Bill Index | 4.94 | 1.93 | 1.80 |
CPI | |||
Consumer Price Index | 3.24% | 5.72% | 4.00% |
Portfolio Manager
Portfolio Manager
November 10, 2023
• | Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund‘s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. |
• | Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds. |
Six Months Ended October 31, 2023 | |||
Beginning Account Value 11/16/2022 | Ending Account Value 10/31/2023 | Expenses Paid During Period | |
Based on Actual Fund Return | |||
Global Environmental Opportunities Stock Fund | |||
Investor Shares | $1,000.00 | $844.70 | $3.49 |
Admiral™ Shares | 1,000.00 | 845.40 | 2.79 |
Based on Hypothetical 5% Yearly Return | |||
Global Environmental Opportunities Stock Fund | |||
Investor Shares | $1,000.00 | $1,021.43 | $3.82 |
Admiral Shares | 1,000.00 | 1,022.18 | 3.06 |
Total Returns Period Ended October 31, 2023 | |||
Since Inception (11/16/2022) | Final Value of a $10,000 Investment | ||
Global Environmental Opportunities Stock Fund Investor Shares | -12.40% | $8,760 | |
MSCI All Country World Index | 5.01 | 10,501 |
Since Inception (11/16/2022) | Final Value of a $50,000 Investment | ||
Global Environmental Opportunities Stock Fund Admiral Shares | -12.28% | $43,860 | |
MSCI All Country World Index | 5.01 | 52,505 |
United States | 42.0% |
China | 20.5 |
Denmark | 12.5 |
Spain | 6.0 |
India | 4.8 |
United Kingdom | 3.7 |
Germany | 3.6 |
France | 3.4 |
Taiwan | 2.7 |
Other | 0.8 |
Shares | Market Value• ($000) | ||
Common Stocks (99.2%) | |||
China (20.3%) | |||
Wuxi Lead Intelligent Equipment Co. Ltd. Class A | 598,627 | 2,288 | |
Contemporary Amperex Technology Co. Ltd. Class A | 75,628 | 1,914 | |
Xinyi Solar Holdings Ltd. | 2,700,000 | 1,589 | |
Sungrow Power Supply Co. Ltd. Class A | 134,809 | 1,548 | |
Zhejiang Sanhua Intelligent Controls Co. Ltd. Class A | 420,535 | 1,534 | |
8,873 | |||
Denmark (12.4%) | |||
* | Vestas Wind Systems A/S | 90,068 | 1,952 |
Novozymes A/S Class B | 41,502 | 1,865 | |
1 | Orsted A/S | 33,461 | 1,617 |
5,434 | |||
France (3.4%) | |||
Schneider Electric SE | 9,715 | 1,495 | |
Germany (3.6%) | |||
Infineon Technologies AG | 53,690 | 1,568 | |
India (4.8%) | |||
Power Grid Corp. of India Ltd. | 864,805 | 2,100 | |
Italy (0.8%) | |||
Industrie De Nora SpA | 24,588 | 347 | |
Spain (5.9%) | |||
Iberdrola SA (XMAD) | 232,113 | 2,582 | |
Taiwan (2.7%) | |||
Voltronic Power Technology Corp. | 29,000 | 1,163 | |
United Kingdom (3.7%) | |||
Croda International plc | 30,374 | 1,619 | |
United States (41.6%) | |||
Waste Management Inc. | 21,437 | 3,523 | |
NextEra Energy Inc. | 42,995 | 2,506 | |
* | ANSYS Inc. | 8,274 | 2,302 |
TE Connectivity Ltd. | 18,156 | 2,140 | |
* | Autodesk Inc. | 10,692 | 2,113 |
* | Aptiv plc | 22,232 | 1,939 |
Rockwell Automation Inc. | 6,128 | 1,610 | |
Carlisle Cos. Inc. | 5,906 | 1,501 | |
Trane Technologies plc | 2,985 | 568 | |
18,202 | |||
Total Common Stocks (Cost $50,533) | 43,383 |
Shares | Market Value• ($000) | ||
Temporary Cash Investments (0.4%) | |||
Money Market Fund (0.4%) | |||
2 | Vanguard Market Liquidity Fund, 5.420% (Cost $176) | 1,766 | 177 |
Total Investments (99.6%) (Cost $50,709) | 43,560 | ||
Other Assets and Liabilities—Net (0.4%) | 154 | ||
Net Assets (100%) | 43,714 | ||
Cost is in $000. |
• | See Note A in Notes to Financial Statements. |
* | Non-income-producing security. |
1 | Security exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At October 31, 2023, the aggregate value was $1,617,000, representing 3.7% of net assets. |
2 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value | |
Unaffiliated Issuers (Cost $50,533) | 43,383 |
Affiliated Issuers (Cost $176) | 177 |
Total Investments in Securities | 43,560 |
Investment in Vanguard | 2 |
Foreign Currency, at Value (Cost $79) | 77 |
Receivables for Investment Securities Sold | 44 |
Receivables for Accrued Income | 14 |
Receivables for Capital Shares Issued | 107 |
Total Assets | 43,804 |
Liabilities | |
Payables for Investment Securities Purchased | 4 |
Payables to Investment Advisor | 42 |
Payables for Capital Shares Redeemed | 7 |
Payables to Vanguard | 6 |
Deferred Foreign Capital Gains Taxes | 31 |
Total Liabilities | 90 |
Net Assets | 43,714 |
At October 31, 2023, net assets consisted of: | |
Paid-in Capital | 50,807 |
Total Distributable Earnings (Loss) | (7,093) |
Net Assets | 43,714 |
Investor Shares—Net Assets | |
Applicable to 998,207 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 17,485 |
Net Asset Value Per Share—Investor Shares | $17.52 |
Admiral Shares—Net Assets | |
Applicable to 1,196,250 outstanding $.001 par value shares of beneficial interest (unlimited authorization) | 26,229 |
Net Asset Value Per Share—Admiral Shares | $21.93 |
November 2, 20221 to October 31, 2023 | |
($000) | |
Investment Income | |
Income | |
Dividends2 | 519 |
Non-Cash Dividends | 94 |
Interest3 | 61 |
Total Income | 674 |
Expenses | |
Investment Advisory Fees—Note B | 135 |
The Vanguard Group—Note C | |
Management and Administrative—Investor Shares | 8 |
Management and Administrative—Admiral Shares | 8 |
Custodian Fees | 24 |
Auditing Fees | 35 |
Shareholders’ Reports—Investor Shares | 22 |
Shareholders’ Reports—Admiral Shares | 2 |
Trustees’ Fees and Expenses | — |
Professional Services | 24 |
Total Expenses | 258 |
Expenses Paid Indirectly | (5) |
Net Expenses | 253 |
Net Investment Income | 421 |
Realized Net Gain (Loss) | |
Investment Securities Sold3 | (252) |
Foreign Currencies | (9) |
Realized Net Gain (Loss) | (261) |
Change in Unrealized Appreciation (Depreciation) | |
Investment Securities3,4 | (7,180) |
Foreign Currencies | (2) |
Change in Unrealized Appreciation (Depreciation) | (7,182) |
Net Increase (Decrease) in Net Assets Resulting from Operations | (7,022) |
1 | Commencement of subscription period for the fund. |
2 | Dividends are net of foreign withholding taxes of $44,000. |
3 | Interest income, realized net gain (loss), capital gain distributions received, and change in unrealized appreciation (depreciation) from an affiliated company of the fund were $61,000, ($1,000), less than $1,000, and $1,000, respectively. Purchases and sales are for temporary cash investment purposes. |
4 | The change in unrealized appreciation (depreciation) is net of the change in deferred foreign capital gains taxes of $31,000. |
November 2, 20221 to October 31, 2023 | |
($000) | |
Increase (Decrease) in Net Assets | |
Operations | |
Net Investment Income | 421 |
Realized Net Gain (Loss) | (261) |
Change in Unrealized Appreciation (Depreciation) | (7,182) |
Net Increase (Decrease) in Net Assets Resulting from Operations | (7,022) |
Distributions | |
Investor Shares | — |
Admiral Shares | — |
Total Distributions | — |
Capital Share Transactions | |
Investor Shares | 20,111 |
Admiral Shares | 30,625 |
Net Increase (Decrease) from Capital Share Transactions | 50,736 |
Total Increase (Decrease) | 43,714 |
Net Assets | |
Beginning of Period | — |
End of Period | 43,714 |
1 | Commencement of subscription period for the fund. |
Investor Shares | |
For a Share Outstanding Throughout Each Period | November 2, 20221 to October 31, 2023 |
Net Asset Value, Beginning of Period | $20.00 |
Investment Operations | |
Net Investment Income2 | .188 |
Net Realized and Unrealized Gain (Loss) on Investments | (2.668) |
Total from Investment Operations | (2.480) |
Distributions | |
Dividends from Net Investment Income | — |
Distributions from Realized Capital Gains | — |
Total Distributions | — |
Net Asset Value, End of Period | $17.52 |
Total Return3 | -12.40% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $17 |
Ratio of Total Expenses to Average Net Assets | 0.77%4,5 |
Ratio of Net Investment Income to Average Net Assets | 0.98%4 |
Portfolio Turnover Rate | 35% |
1 | The subscription period for the fund was November 2, 2022, to November 15, 2022, during which time all assets were held in cash. Performance measurement began November 16, 2022, the first business day after the subscription period, at a net asset value of $20.00. |
2 | Calculated based on average shares outstanding. |
3 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
4 | Annualized. |
5 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.75%. |
Admiral Shares | |
For a Share Outstanding Throughout Each Period | November 2, 20221 to October 31, 2023 |
Net Asset Value, Beginning of Period | $25.00 |
Investment Operations | |
Net Investment Income2 | .279 |
Net Realized and Unrealized Gain (Loss) on Investments | (3.349) |
Total from Investment Operations | (3.070) |
Distributions | |
Dividends from Net Investment Income | — |
Distributions from Realized Capital Gains | — |
Total Distributions | — |
Net Asset Value, End of Period | $21.93 |
Total Return3 | -12.28% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $26 |
Ratio of Total Expenses to Average Net Assets | 0.62%4,5 |
Ratio of Net Investment Income to Average Net Assets | 1.16%4 |
Portfolio Turnover Rate | 35% |
1 | The subscription period for the fund was November 2, 2022, to November 15, 2022, during which time all assets were held in cash. Performance measurement began November 16, 2022, the first business day after the subscription period, at a net asset value of $25.00. |
2 | Calculated based on average shares outstanding. |
3 | Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees. |
4 | Annualized. |
5 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.60%. |
A. | The following significant accounting policies conform to generally accepted accounting principles for U.S. investment companies. The fund consistently follows such policies in preparing its financial statements. |
B. | Ninety One North America, Inc. provides investment advisory services to the fund for a fee calculated at an annual percentage rate of average net assets. For the period ended October 31, 2023, the investment advisory fee represented an effective annual basic rate of 0.34% of the fund’s average net assets. |
C. | In accordance with the terms of a Funds' Service Agreement (the “FSA”) between Vanguard and the fund, Vanguard furnishes to the fund corporate management, administrative, marketing, distribution and cash management services at Vanguard’s cost of operations (as defined by the FSA). These costs of operations are allocated to the fund based on methods and guidelines approved by the board of trustees and are generally settled twice a month. |
D. | The fund’s custodian bank has agreed to reduce its fees when the fund maintains cash on deposit in the non-interest-bearing custody account. For the period ended October 31, 2023, custodian fee offset arrangements reduced the fund’s expenses by $5,000 (an annual rate of 0.01% of average net assets). |
E. | Various inputs may be used to determine the value of the fund’s investments. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities. |
Level 1 ($000) | Level 2 ($000) | Level 3 ($000) | Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks—North and South America | 18,202 | — | — | 18,202 |
Common Stocks—Other | — | 25,181 | — | 25,181 |
Temporary Cash Investments | 177 | — | — | 177 |
Total | 18,379 | 25,181 | — | 43,560 |
F. | Permanent differences between book-basis and tax-basis components of net assets are reclassified among capital accounts in the financial statements to reflect their tax character. These reclassifications have no effect on net assets or net asset value per share. As of period end, permanent differences primarily attributable to the accounting for applicable foreign currency transactions and distributions in connection with fund share redemptions were reclassified between the following accounts: |
Amount ($000) | |
Paid-in Capital | 71 |
Total Distributable Earnings (Loss) | (71) |
Amount ($000) | |
Undistributed Ordinary Income | 740 |
Undistributed Long-Term Gains | — |
Net Unrealized Gains (Losses) | (7,833) |
Capital Loss Carryforwards | — |
Qualified Late-Year Losses | — |
Other Temporary Differences | — |
Total | (7,093) |
Period Ended October 31, | |
2023 Amount ($000) | |
Ordinary Income | — |
Long-Term Capital Gains | — |
Amount ($000) | |
Tax Cost | 51,361 |
Gross Unrealized Appreciation | 920 |
Gross Unrealized Depreciation | (8,721) |
Net Unrealized Appreciation (Depreciation) | (7,801) |
G. | During the period ended October 31, 2023, the fund purchased $64,494,000 of investment securities and sold $13,805,000 of investment securities, other than temporary cash investments. |
H. | Capital share transactions for each class of shares were: |
November 2, 20221 to October 31, 2023 | ||
Amount ($000) | Shares (000) | |
Investor Shares | ||
Issued | 26,143 | 1,298 |
Issued in Lieu of Cash Distributions | — | — |
Redeemed | (6,032) | (300) |
Net Increase (Decrease)—Investor Shares | 20,111 | 998 |
November 2, 20221 to October 31, 2023 | ||
Amount ($000) | Shares (000) | |
Admiral Shares | ||
Issued | 37,053 | 1,468 |
Issued in Lieu of Cash Distributions | — | — |
Redeemed | (6,428) | (272) |
Net Increase (Decrease)—Admiral Shares | 30,625 | 1,196 |
1 | Commencement of subscription period for the fund. |
I. | Significant market disruptions, such as those caused by pandemics (e.g., COVID-19 pandemic), natural or environmental disasters, war (e.g., Russia’s invasion of Ukraine), acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
J. | Management has determined that no events or transactions occurred subsequent to October 31, 2023, that would require recognition or disclosure in these financial statements. |
Philadelphia, Pennsylvania
December 19, 2023
Matthew Benchener | Thomas M. Rampulla |
Joseph Brennan | Karin A. Risi |
Mortimer J. Buckley | Anne E. Robinson |
Gregory Davis | Michael Rollings |
John James | Nitin Tandon |
Chris D. Mclsaac | Lauren Valente |
All rights reserved.
Vanguard Marketing Corporation, Distributor.
Item 2: Code of Ethics.
The Registrant has adopted a code of ethics that applies to the Registrant’s principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. The Code of Ethics was amended during the reporting period covered by this report to make certain technical, non-material changes.
Item 3: Audit Committee Financial Expert.
All members of the Audit Committee have been determined by the Registrant’s Board of Trustees to be Audit Committee Financial Experts and to be independent: F. Joseph Loughrey, Mark Loughridge, Sarah Bloom Raskin, and Peter F. Volanakis.
Item 4: Principal Accountant Fees and Services.
(a) | Audit Fees. |
Audit Fees of the Registrant.
Fiscal Year Ended October 31, 2023: $135,000
Fiscal Year Ended October 31, 2022: $192,000
Aggregate Audit Fees of Registered Investment Companies in the Vanguard Group.
Fiscal Year Ended October 31, 2023: $9,326,156
Fiscal Year Ended October 31, 2022: $10,494,508
Includes fees billed in connection with audits of the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and Vanguard Marketing Corporation.
(b) | Audit-Related Fees. |
Fiscal Year Ended October 31, 2023: $3,295,934
Fiscal Year Ended October 31, 2022: $2,757,764
Includes fees billed in connection with assurance and related services provided to the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and Vanguard Marketing Corporation.
(c) | Tax Fees. |
Fiscal Year Ended October 31, 2023: $1,678,928
Fiscal Year Ended October 31, 2022: $5,202,689
Includes fees billed in connection with tax compliance, planning, and advice services provided to the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and Vanguard Marketing Corporation.
(d) | All Other Fees. |
Fiscal Year Ended October 31, 2023: $25,000
Fiscal Year Ended October 31, 2022: $298,000
Includes fees billed for services related to tax reported information provided to the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and Vanguard Marketing Corporation.
(e) (1) Pre-Approval Policies. The policy of the Registrant’s Audit Committee is to consider, and, if appropriate, approve before the principal accountant is engaged for such services, all specific audit and non-audit services provided to: the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and entities controlled by The Vanguard Group, Inc. that provide ongoing services to the Registrant. In making a determination, the Audit Committee considers whether the services are consistent with maintaining the principal accountant’s independence.
In the event of a contingency situation in which the principal accountant is needed to provide services in between scheduled Audit Committee meetings, the Chairman of the Audit Committee would be called on to consider and, if appropriate, pre-approve audit or permitted non-audit services in an amount sufficient to complete services through the next Audit Committee meeting, and to determine if such services would be consistent with maintaining the accountant’s independence. At the next scheduled Audit Committee meeting, services and fees would be presented to the Audit Committee for formal consideration, and, if appropriate, approval by the entire Audit Committee. The Audit Committee would again consider whether such services and fees are consistent with maintaining the principal accountant’s independence.
The Registrant’s Audit Committee is informed at least annually of all audit and non-audit services provided by the principal accountant to the Vanguard complex, whether such services are provided to: the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., or other entities controlled by The Vanguard Group, Inc. that provide ongoing services to the Registrant.
(2) No percentage of the principal accountant’s fees or services were approved pursuant to the waiver provision of paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) For the most recent fiscal year, over 50% of the hours worked under the principal accountant’s engagement were not performed by persons other than full-time, permanent employees of the principal accountant.
(g) Aggregate Non-Audit Fees.
Fiscal Year Ended October 31, 2023: $1,703,928
Fiscal Year Ended October 31, 2022: $5,500,689
Includes fees billed for non-audit services provided to the Registrant, other registered investment companies in the Vanguard complex, The Vanguard Group, Inc., and Vanguard Marketing Corporation.
(h) For the most recent fiscal year, the Audit Committee has determined that the provision of all non-audit services was consistent with maintaining the principal accountant’s independence.
Item 5: Audit Committee of Listed Registrants.
The Registrant is a listed issuer as defined in rule 10A-3 under the Securities Exchange Act of 1934 (“Exchange Act”). The Registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The Registrant’s audit committee members are: F. Joseph Loughrey, Mark Loughridge, Sarah Bloom Raskin, and Peter F. Volanakis.
Item 6: Investments.
Not applicable. The complete schedule of investments is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7: Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8: Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9: Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10: Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 11: Controls and Procedures.
(a) Disclosure Controls and Procedures. The Principal Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.
(b) Internal Control Over Financial Reporting. There were no significant changes in the Registrant’s Internal Control Over Financial Reporting or in other factors that could significantly affect this control during the period covered by this report, including any corrective actions with regard to significant deficiencies and material weaknesses.
Item 12: Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13: Exhibits.
(a)(1) | Code of Ethics filed herewith. |
(a)(2) | Certifications filed herewith. |
(a)(2) | Certifications filed herewith. |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
VANGUARD TRUSTEES’ EQUITY FUND | ||
BY: | /s/ MORTIMER J. BUCKLEY* | |
MORTIMER J. BUCKLEY | ||
CHIEF EXECUTIVE OFFICER |
Date: December 21, 2023
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
VANGUARD TRUSTEES’ EQUITY FUND | ||
BY: | /s/ MORTIMER J. BUCKLEY* | |
MORTIMER J. BUCKLEY | ||
CHIEF EXECUTIVE OFFICER | ||
Date: December 21, 2023 | ||
VANGUARD TRUSTEES’ EQUITY FUND | ||
BY: | /s/ CHRISTINE BUCHANAN* | |
CHRISTINE BUCHANAN | ||
CHIEF FINANCIAL OFFICER |
Date: December 21, 2023
* By: | /s/ Anne E. Robinson |
Anne E. Robinson, pursuant to a Power of Attorney filed on July 21, 2023 (see File Number 33-53683) and to a Power of Attorney filed on March 29, 2023 (see File Number 2-11444), Incorporated by Reference.