UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT
OF
REGISTERED MANAGEMENT COMPANY
Investment Company Act file number: | 811-1027 |
Name of Registrant: | Vanguard World Funds |
Address of Registrant: | P.O. Box 2600 Valley Forge, PA 19482 |
Name and address of agent for service: | R. Gregory Barton, Esquire P.O. Box 876 Valley Forge, PA 19482 |
Registrant’s telephone number, including area code: (610) 669-1000
Date of fiscal year end: | August 31 |
Date of reporting period: | September 1, 2004 – February 28, 2005 |
Item 1: | Reports to Shareholders |
Vanguard® U.S. Growth Fund | ||
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February 28, 2005 |
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CONTENTS | |
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1 | CHAIRMAN'S LETTER |
6 | ADVISOR'S REPORT |
9 | FUND PROFILE |
10 | GLOSSARY OF INVESTMENT TERMS |
11 | PERFORMANCE SUMMARY |
12 | ABOUT YOUR FUND'S EXPENSES |
14 | FINANCIAL STATEMENTS |
24 | ADVANTAGES OF VANGUARD.COM |
SUMMARY | |
• | The Investor Shares of Vanguard U.S. Growth Fund returned 9.7%, and the Admiral Shares returned 9.8%, for the fiscal half-year ended February 28, 2005. |
• | The fund's gains surpassed those of both the average large-cap growth fund and the benchmark Russell 1000 Growth Index. |
• | Gains came in almost all sectors. The fund's holdings in the technology sector made the biggest contribution to returns. |
VANGUARD’S PLEDGE TO CLIENTS | ||
We recognize that your relationship with Vanguard rests on the twin pillars of trust and excellence, each of which is built upon the character of our people. Our Pledge to Clients reflects our ongoing efforts to deserve your trust and to continually improve so that we can offer you excellence in all that we do. | ||
We will: | ||
• | Put your interests first at all times. | |
• | Continually seek to earn your trust by adhering to the highest standards of ethical behavior and fiduciary responsibility. | |
• | Strive to be the highest-value provider of investment services, which means outstanding investment performance and service, both at the lowest possible cost. | |
• | Communicate candidly not only about the rewards of investing but also about the risks and costs. | |
• | Maintain highly effective controls to safeguard your assets and protect your confidential information. | |
• | Invest a majority of our personal assets alongside yours. | |
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Please note: The opinions expressed in this report are just that--informed opinions. They should not be considered promises or advice. Also, please keep in mind that the information and opinions cover the period through the date on the cover of this report. Of course, the risks of investing in your fund are spelled out in the prospectus. | ||
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CHAIRMAN'S LETTER | |
Dear Shareholder,
Vanguard U.S. Growth Fund’s Investor Shares posted a 9.7% return for the six months ended February 28, 2005. The fund’s Admiral Shares returned 9.8%. Both gains exceeded the return of the Russell 1000 Growth Index by 2 percentage points and the return of the average peer fund by about 1 percentage point.
Total Returns | Six Months Ended February 28, 2005 |
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Vanguard U.S. Growth Fund | |
Investor Shares | 9.7% |
Admiral Shares | 9.8 |
Russell 1000 Growth Index | 7.7 |
Average Large-Cap Growth Fund* | 8.8 |
Dow Jones Wilshire 5000 Index | 11.6 |
*Derived from data provided by Lipper Inc. |
Throughout the six months, the fund benefited from its advisors’ focus on “growth at a reasonable price.” This focus led the advisors to choose some stocks that produced outstanding results, even if they were not in market-beating sectors. |
The table at left provides details about the total returns (capital change plus reinvested distributions) for your fund and comparative standards: the benchmark Russell 1000 Growth Index, the average competing fund, and the Dow Jones Wilshire 5000 Composite Index, the broadest measure of the U.S. stock market. You can find information on the fund's per-share distributions during the period and its starting and ending net asset values in the table on page 5. |
STOCKS SURGED AFTER THE NOVEMBER ELECTION
During the past six months, stock investors tried to digest and act on conflicting information: generally positive economic indicators but relatively modest job growth; surging commodity prices but modest inflation for most other goods and services; and a falling U.S. dollar that was either a boon or a bane to the economy, depending on the pundit. |
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Admiral™ Shares | |
A lower-cost class of shares available to many longtime shareholders and to those with significant investments in the fund. | |
Nevertheless, in the aggregate, stocks moved higher, particularly after it was clear that November's presidential election was not going to reprise the protracted 2000 contest. |
As they have for the past five years, mid- and small-capitalization stocks outpaced large-caps. Among the latter, value stocks--those whose prices are low relative to company earnings, book value, or other measures--generally outperformed their growth counterparts. Returns were positive across industry sectors, with energy-related stocks notching the highest results, boosted in part by crude oil prices that stayed above $40 a barrel through most of the period, at one point reaching a record of nearly $56. |
In overseas markets, stock returns were generally superior to those seen in the United States. And the returns abroad were further augmented for U.S.-based investors by the weakness of the U.S. dollar, which reached multiyear lows relative to other major currencies near the end of calendar 2004. |
YIELDS ROSE FOR SHORT- AND INTERMEDIATE-TERM BONDS
The Federal Reserve Board continued its gradual shift in monetary policy, moving away from its "accommodative" stance of keeping interest rates very low. During the fiscal half-year, the Fed raised its target for the federal funds rate in four quarter-point increments, from 1.50% to 2.50%. Short- and intermediate-term bonds felt the ripples. The yield of the 3-month U.S. Treasury bill, a proxy for money market yields, rose 117 basis points (1.17 percentage points) to 2.75%. The yield of the 10-year Treasury note rose 26 basis points to |
Market Barometer | Total Returns Periods Ended February 28, 2005 | ||
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| Six Months | One Year | Five Years* |
Stocks | |||
Russell 1000 Index (Large-caps) | 10.8% | 7.5% | -0.9% |
Russell 2000 Index (Small-caps) | 16.4 | 9.5 | 3.2 |
Dow Jones Wilshire 5000 Index | 11.6 | 7.9 | -1.2 |
(Entire market) | |||
MSCI All Country World Index | |||
ex USA (International) | 22.8 | 20.1 | 1.2 |
Bonds | |||
Lehman Aggregate Bond Index | 1.3% | 2.4% | 7.5% |
(Broad taxable market) | |||
Lehman Municipal Bond Index | 2.4 | 3.0 | 7.2 |
Citigroup 3-Month Treasury Bill Index | 0.9 | 1.4 | 2.7 |
CPI | |||
Consumer Price Index | 1.2% | 3.0% | 2.5% |
*Annualized |
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4.38%. However, yields of longer-term bonds, which are less sensitive to Fed moves, were lower at the end of the fiscal half-year than at the beginning. |
With price declines partly offsetting interest income, the total return of the overall taxable investment-grade bond market (as measured by the Lehman Brothers Aggregate Bond Index) was a modest 1.3%. Below-investment-grade bonds, as measured by the Lehman High Yield Index, returned 7.5%, as investors' appetite for yield kept the higher-risk securities' prices aloft. Municipal bonds generally outpaced their taxable peers even before factoring in their tax advantages. |
SOLID GAINS FROM LARGE SECTOR HOLDINGS DROVE THE FUND'S SUCCESS
The U.S. Growth Fund's admirable showing during the fiscal half-year was a testament to the advisors' ability to find attractively valued stocks that offer strong prospects for growth. Alliance Capital Management and William Blair & Company were successful with holdings in many sectors. |
Most of the fund's gain came as the stock market advanced during the first three months of the period, especially in the post-election rally. The fund gained 8.8 percentage points of its 9.7% return (for Investor Shares) during this time. From December through February, as the stock market more or less treaded water, the fund managed to gain less than 1 percentage point. |
The fund's technology holdings, which represented nearly one-quarter of assets on February 28, posted strong returns that were important to the six-month result. The advisors held relatively large positions in a number of leading performers--including Dell, Broadcom, and Marvell Technology--that benefited from strong earnings and product introductions. The tech sector's news wasn't all positive, though; some of the fund's larger holdings, including Symantec and QUALCOMM, stumbled as their competitive conditions grew more challenging. |
Fund Assets Managed | February 28, 2005 | |
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$ Million | Percentage | |
Alliance Capital | ||
Management L.P. | $3,990 | 66% |
William Blair & | ||
Company, LLC | 1,773 | 30 |
Cash Investments* | 220 | 4 |
Total | $5,983 | 100% |
*These short-term reserves are invested by The Vanguard Group in equity index products to simulate investment in stocks. Each advisor may also maintain a modest cash position. |
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Financial services stocks were another heavy sector commitment for U.S. Growth. Although financial stocks in general were among the market’s weaker performers, the advisors’ selections performed quite well. The advisors typically overweight this sector relative to the benchmark, believing that the financial group harbors a number of reasonably valued stocks. Their bulked-up position paid off nicely in the fiscal half-year, as the fund’s holdings performed signifi-cantly better than the index sector. Particularly strong contributors included Goldman Sachs and Legg Mason, both of which recorded impressive growth in assets under management and revenues. |
The fund's admirable performance during the period was the result of numerous solid stock selections by the advisors. These choices came in many sectors, most notably technology, health care, and financial services. | |
The fund's health care positions also produced generally solid results. A number of health care management companies--including UnitedHealth Group, WellPoint, and Caremark Rx--had healthy gains that offset disappointing performances by beleaguered drugmakers. |
On the weaker side, some poor choices among consumer discretionary stocks led to a gain of 5.2% for the group. This was a disappointing result given the size of the fund's stake in the sector (about 13% of assets at the period's end). The fund held some key issues that produced solid returns (including Lowe's and Yahoo!), but it did not own shares in a number of the best-performing index components. |
To learn more about the fund's positioning and performance during the period, please see the Advisor's Report, which begins on page 6. |
OUR CONSTANT ADVICE: HOLD STEADY IN ALL MARKET CONDITIONS
The events of the past five years in the financial markets have taken investors' emotions on a roller-coaster ride, from the gloom of the protracted market downturn beginning in March 2000 to the ebullience of a sharp rebound, and all points in between. The key to success during this topsy-turvy period has been resisting the urge to change in response to market noise. |
As Vanguard frequently reminds investors, successful long-term investing depends on a few simple principles: balance, diversification, and low costs. If you continuously apply these tenets to your investments, resisting |
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the temptation to upset your carefully determined asset allocation on the basis of market volatility, you'll be positioned to benefit no matter what occurs. By sticking with your chosen mix of stocks, bonds, and short-term reserves, you'll enhance the ability to meet your long-term goals. The U.S. Growth Fund--with its focus on dynamic, growth-oriented businesses--can serve well as a component of the stock portion of a balanced portfolio. |
If you would like some help in fine-tuning your investment plan, or would like to explore a vast array of educational material useful to both beginning and seasoned investors, I encourage you to visit Vanguard.com. Our website also provides many interactive tools that you might find useful. |
Thank you for your continued confidence in Vanguard. |
Sincerely, |
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John J. Brennan | |
CHAIRMAN AND CHIEF EXECUTIVE OFFICER | |
MARCH 10, 2005 |
Your Fund's Performance at a Glance | August 31, 2004-February 28, 2005 | |||
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Distributions Per Share | ||||
| Starting Share Price | Ending Share Price | Income Dividends | Capital Gains |
U.S. Growth Fund | ||||
Investor Shares | $14.39 | $15.74 | $0.045 | $0.000 |
Admiral Shares | 37.29 | 40.75 | 0.209 | 0.000 |
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ADVISOR’S REPORT | |
During the six months ended February 28, 2005, Vanguard U.S. Growth Fund's Investor Shares returned 9.7%. The following comments reflect the views and investment decisions of Alliance Capital Management, which managed 66% of fund assets as of February 28. |
INVESTMENT ENVIRONMENT
The period spanned a volatile environment in the stock market. After suffering a broadly based correction--the most significant since the cyclical recovery began two years ago--the market rebounded strongly in November and December. In contrast, the last two months of the fiscal half-year were comparatively stable. |
The market's initial malaise reflected a combination of geopolitical and economic issues that developed over the summer. Surging energy prices raised concerns about the sustainability of U.S. economic expansion, and these concerns were reinforced by numerous disappointing economic reports. Investors also focused increasingly on the nation's current-account and fiscal deficits. Consumer confidence faltered, overall business activity waned, and retail sales slowed. Health care, technology, and finance equities all exhibited weakness. In many instances, this was in striking contrast to the fact that numerous companies within these sectors exhibited strength in earnings growth. |
Investment Philosophy | |
The fund reflects a belief that superior long-term investment results can be achieved by emphasizing investments in growth companies that are leaders in their industries and that have a strong market presence. | |
The continued strength in earnings growth contributed to positive investor sentiment, which was reinforced by the correction in oil prices during the fourth calendar quarter and improved dramatically after the U.S. presidential election. Not surprisingly, the market rebound was led by some of the sectors that had underperformed during the third calendar quarter, such as industrials, health care, and financial services. Recent months have seen isolated strength in traditionally defensive sectors such as energy, utilities, consumer staples, and health care. |
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OUR SUCCESSES
We made a number of favorable selections among health care stocks, with particularly strong performances from WellPoint, UnitedHealth Group, Zimmer Holdings, and Caremark Rx. Each has continued to produce notable earnings, as their fourth-quarter results attest. Legg Mason and Goldman Sachs performed well within the financial services sector. In addition, two homebuilders, Centex and Lennar, contributed to relative performance. |
OUR SHORTFALLS
Although the fund's overall exposure to the technology sector helped returns, several individual holdings, including Juniper Networks, Symantec, and QUALCOMM, were disappointing in the fiscal half-year. American International Group and Citigroup hurt the overall performance of our financial services holdings. Other laggards included Forest Laboratories, Harley-Davidson, and eBay. |
THE PORTFOLIO'S POSITIONING
In volatile equity markets, particularly those characterized by a frequent rotation of strength among industry sectors, it is sometimes easy to lose perspective of longer-term fundamentals. Although significant ongoing challenges and risks remain, the U.S. economic system and corporate sectors continue to exhibit impressive resilience and adaptability. While the 2000-2002 market downturn was particularly challenging for the economy and most business sectors, many companies navigated it successfully and continue to exhibit impressive growth. Corporate profit margins are at 30-year highs. Corporate liquidity is particularly strong. Finally, despite substantially reduced financial leverage, many companies continue to produce strong returns on equity--all the more impressive considering the modest rate of inflation. Investor sentiment has been volatile over both the past year and the past decade. The fundamental performance of many leading companies has, by contrast, been far more consistent. |
We remain generally positive on the prospects for economic expansion and corporate profits. Liquidity, which has remained positive for four years, actually strengthened in 2004. Free cash flow remains strong, with the capital gap between cash flow and investment now at an unprecedented $350 billion. Cumulatively, over the past three years, cash flow |
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has exceeded investment by $1 trillion, resulting in extraordinary levels of corporate liquidity. It is worth noting that capital investment and exports were the two fastest-growing components of gross domestic product growth in 2004. |
Nonetheless, two years into the economic recovery, it seems reasonable to expect corporate-profit growth to decelerate as the rate of economic expansion returns to a more sustainable pace. To the extent that this occurs, we expect investors to become more discriminating about the long-term prospects for companies' growth. |
The protracted underperformance of growth stocks in the face of continued strong earnings growth has resulted in a significant valuation compression. The current relative valuation accorded many quality growth stocks appears modest given their long-term historical ranges. We are continuing our efforts to orient the portfolio toward successful, well-managed companies that we believe are capable of superior earnings growth in coming years. Over the past five years--longer, in numerous cases--many of our companies have consistently outgrown their peers. We seek to balance our exposure between stocks from economically sensitive sectors-such as technology, consumer discretionary, and financial services--and stocks from more defensive, consistent-growth sectors, such as health care. |
A foundation of our approach to growth investing is the belief that, while markets are often inefficient in the short run, stock prices ultimately reflect the fundamental success and growth of the underlying companies. In consequence, we believe that long-term investment success is best achieved through a diversified portfolio of successful, well-managed companies with sustainable advantages, superior growth potential, and favorable relative valuations. |
Our portfolio is built around companies we believe are capable of superior long-term growth. This is reflected in the 19% average five-year historical revenue growth of the fund's holdings, compared with 10% for the Russell 1000 Growth Index. Similarly, the average earnings growth rate of the fund's holdings was 26% over the past five years, compared with 13% for its Russell benchmark. |
Alan Levi, SENIOR VICE PRESIDENT | |
ALLIANCE CAPITAL MANAGEMENT L.P. | |
MARCH 16, 2005 |
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FUND PROFILES | |
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As of 2/28/2005 | This Profile provides a snapshot of the fund's characteristics, compared where Indicated with both an appropriate market index and a broad market index. Key terms are defined on page 10. |
U.S. GROWTH FUND | |||
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Portfolio Characteristics | |||
Comparative | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 71 | 622 | 4,973 |
Median Market Cap | $27.3B | $45.8B | $27.5B |
Price/Earnings Ratio | 22.9x | 23.0x | 21.2x |
Price/Book Ratio | 4.0x | 4.2x | 2.8x |
Yield | 1.1% | 1.6% | |
Investor Shares | 0.1% | ||
Admiral Shares | 0.3% | ||
Return on Equity | 22.0% | 22.4% | 15.8% |
Earnings Growth Rate | 21.8% | 12.9% | 8.0% |
Foreign Holdings | 6.8% | 0.0% | 1.1% |
Turnover Rate | 39%† | — | — |
Expense Ratio | — | — | |
Investor Shares | 0.54%† | ||
Admiral Shares | 0.32%† | ||
Short-Term Reserves | 0% | — | — |
Volatility Measures | ||||
---|---|---|---|---|
Comparative | Broad | |||
| Fund | Index* | Fund | Index** |
R-Squared | 0.96 | 1.00 | 0.91 | 1.00 |
Beta | 1.06 | 1.00 | 1.08 | 1.00 |
Sector Diversification (% of portfolio) | |||
---|---|---|---|
| Fund | Comparative Index* | Broad Index** |
Auto & Transportation | 3% | 2% | 3% |
Consumer Discretionary | 13 | 20 | 16 |
Consumer Staples | 2 | 9 | 7 |
Financial Services | 18 | 11 | 22 |
Health Care | 27 | 24 | 12 |
Integrated Oils | 0 | 0 | 5 |
Other Energy | 2 | 2 | 3 |
Materials & Processing | 1 | 2 | 5 |
Producer Durables | 6 | 5 | 4 |
Technology | 25 | 22 | 13 |
Utilities | 1 | 1 | 6 |
Other | 2 | 2 | 4 |
*Russell 1000 Growth Index.
**Dow Jones Wilshire 5000 Index.
† Annualized.
Ten Largest Holdings (% of total net assets) | |
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Dell Inc. | 4.3% |
(computer hardware) | |
Zimmer Holdings, Inc. | 3.4 |
(health care) | |
UnitedHealth Group Inc. | 3.4 |
(health care) | |
Legg Mason Inc. | 2.9 |
(financial services) | |
eBay Inc. | 2.9 |
(business services) | |
American International Group, Inc. | 2.9 |
(insurance) | |
Marvell Technology Group Ltd. | 2.9 |
(electronics) | |
Danaher Corp. | 2.7 |
(industrial manufacturing) | |
Harley-Davidson, Inc. | 2.5 |
(automotive and transport) | |
Citigroup, Inc. | 2.5 |
(banking) | |
Top Ten | 30.4% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. |
Investment Focus
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Visit our website at Vanguard.com
for regularly updated fund information.
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GLOSSARY OF INVESTMENT TERMS | |
Beta. A measure of the magnitude of a fund's past share-price fluctuations in relation to the ups and downs of a given market index. The index is assigned a beta of 1.00. Compared with a given index, a fund with a beta of 1.20 typically would have seen its share price rise or fall by 12% when the index rose or fell by 10%. A fund's beta should be reviewed in conjunction with its R-squared (see definition below). The lower the R-squared, the less correlation there is between the fund and the index, and the less reliable beta is as an indicator of volatility. |
Earnings Growth Rate. The average annual rate of growth in earnings over the past five years for the stocks now in a fund. |
Expense Ratio. The percentage of a fund's average net assets used to pay its annual administrative and advisory expenses. These expenses directly reduce returns to investors. |
Foreign Holdings. The percentage of a fund's equity assets represented by stocks or depositary receipts of companies based outside the United States. |
Median Market Cap. An indicator of the size of companies in which a fund invests; the midpoint of market capitalization (market price x shares outstanding) of a fund's stocks, weighted by the proportion of the fund's assets invested in each stock. Stocks representing half of the fund's assets have market capitalizations above the median, and the rest are below it. |
Price/Book Ratio. The share price of a stock divided by its net worth, or book value, per share. For a fund, the weighted average price/book ratio of the stocks it holds. |
Price/Earnings Ratio. The ratio of a stock's current price to its per-share earnings over the past year. For a fund, the weighted average P/E of the stocks it holds. P/E is an indicator of market expectations about corporate prospects; the higher the P/E, the greater the expectations for a company's future growth. |
R-Squared. A measure of how much of a fund's past returns can be explained by the returns from the market in general, as measured by a given index. If a fund's total returns were precisely synchronized with an index's returns, its R-squared would be 1.00. If the fund's returns bore no relationship to the index's returns, its R-squared would be 0. |
Return on Equity. The annual average rate of return generated by a company during the past five years for each dollar of shareholder's equity (net income divided by shareholder's equity). For a fund, the weighted average return on equity for the companies whose stocks it holds. |
Short-Term Reserves. The percentage of a fund invested in highly liquid, short-term securities that can be readily converted to cash. |
Turnover Rate. An indication of the fund's trading activity. Funds with high turnover rates incur higher transaction costs and may be more likely to distribute capital gains (which may be taxable to investors). |
Yield. A snapshot of a fund's income from interest and dividends. The yield, expressed as a percentage of the fund's net asset value, is based on income earned over the past 30 days and is annualized, or projected forward for the coming year. The index yield is based on the current annualized rate of income provided by securities in the index. |
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PERFORMANCE SUMMARY | |
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As of 2/28/2005 | All of the returns in this report represent past performance, which is not a guarantee of future results that may be achieved by the fund. (For performance data current to the most recent month-end, which may be higher or lower than that cited, visit our website at www.vanguard.com.) Note, too, that both investment returns and principal value can fluctuate widely, so an investor's shares, when sold, could be worth more or less than their original cost. The returns shown do not reflect taxes that a shareholder would pay on fund distributions or on the sale of fund shares. |
U.S. GROWTH FUND
Fiscal-Year Total Returns (%) August 31, 1994-February 28, 2005
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Average Annual Total Returns for periods ended December 31, 2004 | ||||||
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This table presents average annual total returns through the latest calendar quarter--rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information. | ||||||
Ten Years | ||||||
| Inception Date | One Year | Five Years | Capital | Income | Total |
U.S. Growth Fund | ||||||
Investor Shares | 1/6/1959 | 7.03% | -13.93% | 5.33% | 0.59% | 5.92% |
Admiral Shares | 8/13/2001 | 7.29 | -4.61** | — | — | — |
*Six months ended February 28, 2005.
**Return since inception.
Note: See Financial Highlights tables on pages 19 and 20 for dividend and capital gains information.
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ABOUT YOUR FUND'S EXPENSES | |
We believe it is important for you to understand the impact of costs on your investment. All mutual funds have operating expenses. As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund's gross income, directly reduce the investment return of the fund. |
A fund's expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period. |
The table below illustrates your fund's costs in two ways: |
• | 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. |
To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading "Expenses Paid During 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 February 28, 2005 | |||
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U.S. Growth Fund | Beginning Account Value Aug. 31, 2004 | Ending Account Value Feb. 28, 2005 | Expenses Paid During Period* |
Based on Actual Fund Return | |||
Investor Shares | $1,000.00 | $1,096.87 | $2.81 |
Admiral Shares | 1,000.00 | 1,098.27 | 1.66 |
Based on Hypothetical 5% Yearly Return | |||
Investor Shares | $1,000.00 | $1,022.12 | $2.71 |
Admiral Shares | 1,000.00 | 1,023.21 | 1.61 |
*The calculations are based on expenses incurred in the most recent six-month period. The fund's annualized six-month expense ratios for that period are 0.54% for Investor Shares and 0.32% for Admiral Shares. The dollar amounts shown as "Expenses Paid" are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by the number of days in the most recent 12-month period. |
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Annualized Expense Ratios: | |||
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Your fund compared with its peer group | |||
Average | |||
Large-Cap | |||
Investor | Admiral | Growth | |
Shares | Shares | Fund | |
U.S. Growth Fund | 0.54% | 0.32% | 1.51%* |
*Peer-group expense ratio is derived from data provided by Lipper Inc. and captures information through year-end 2004. |
Note that the expenses shown in the table on page 12 are meant to highlight and help you compare ongoing costs only and do not reflect any transactional costs or account maintenance fees. They do not include your fund’s low-balance fee, which is described in the prospectus. If this fee were applied to your account, your costs would be higher. Your fund does not charge transaction fees, such as purchase or redemption fees, nor does it carry a “sales load.” |
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. |
You can find more information about the fund’s expenses, including annual expense ratios, in the Financial Statements section of this report. For additional information on operating expenses and other shareholder costs, please refer to the current fund prospectus. |
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As of 2/28/2005 | FINANCIAL STATEMENTS (UNAUDITED) |
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STATEMENT OF NET ASSETS |
This Statement provides a detailed list of the fund’s holdings, including each security’s market value on the last day of the reporting period. Securities are grouped and subtotaled by asset type (common stocks, bonds, etc.) and by industry sector. Other assets are added to, and liabilities are subtracted from, the value of Total Investments to calculate the fund’s Net Assets. Finally, Net Assets are divided by the outstanding shares of the fund to arrive at its share price, or Net Asset Value (NAV) Per Share. |
At the end of the Statement of Net Assets, you will find a table displaying the composition of the fund’s net assets. Because all income and any realized gains must be distributed to shareholders each year, the bulk of net assets consists of Paid-in Capital (money invested by shareholders). The amounts shown for Undistributed Net Investment Income and Accumulated Net Realized Gains usually approximate the sums the fund had available to distribute to shareholders as income dividends or capital gains as of the statement date, but may differ because certain investments or transactions may be treated differently for financial statement and tax purposes. Any Accumulated Net Realized Losses, and any cumulative excess of distributions over net income or net realized gains, will appear as negative balances. Unrealized Appreciation (Depreciation) is the difference between the market value of the fund’s investments and their cost, and reflects the gains (losses) that would be realized if the fund were to sell all of its investments at their statement-date values. |
The fund provides a complete list of its holdings four times in each fiscal year, at the quarter-ends. For the second and fourth fiscal quarters, the lists appear in the fund’s semiannual and annual reports to shareholders. For the first and third fiscal quarters, the fund files the lists with the Securities and Exchange Commission on Form N-Q. Shareholders can look up the fund’s Forms N-Q on the SEC’s website at www.sec.gov. Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room (see the back cover of this report for further information). |
U.S. Growth Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (95.5%)(1) | ||
Auto & Transportation (2.8%) | ||
Harley-Davidson, Inc. | 2,461,610 | $ 152,324 |
United Parcel Service, Inc. | 202,200 | 15,668 |
167,992 | ||
Consumer Discretionary (12.2%) | ||
eBay Inc. | 4,056,400 | 173,776 |
Yahoo! Inc. | 3,638,200 | 117,405 |
Lowe's Cos., Inc. | 1,586,633 | 93,262 |
Bed Bath & Beyond, Inc. | 2,247,855 | 84,340 |
Avon Products, Inc. | 1,929,515 | 82,525 |
Wal-Mart Stores, Inc. | 1,147,450 | 59,220 |
Kohl's Corp. | 1,128,159 | 54,005 |
Google Inc. | 205,000 | 38,538 |
Electronic Arts Inc. | 388,167 | 25,033 |
728,104 | ||
Consumer Staples (1.8%) | ||
Walgreen Co. | 1,472,060 | 63,048 |
PepsiCo, Inc. | 853,340 | 45,961 |
109,009 | ||
Financial Services (18.0%) | ||
Legg Mason Inc. | 2,171,300 | 175,094 |
American International | ||
Group, Inc. | 2,599,200 | 173,627 |
Citigroup, Inc. | 3,154,800 | 150,547 |
The Goldman Sachs Group, Inc. | 1,319,140 | 143,522 |
First Data Corp. | 1,751,600 | 71,851 |
MBNA Corp. | 2,466,500 | 62,575 |
Merrill Lynch & Co., Inc. | 975,508 | 57,145 |
JPMorgan Chase & Co. | 1,376,200 | 50,300 |
SLM Corp. | 929,949 | 45,382 |
Paychex, Inc. | 1,291,236 | 41,229 |
Ambac Financial Group, Inc. | 509,400 | 39,621 |
Morgan Stanley | 633,375 | 35,767 |
Charles Schwab Corp. | 2,695,000 | 28,298 |
1,074,958 | ||
Health Care (26.1%) | ||
Biotech Research & Production (2.8%) | ||
* Amgen, Inc. | 2,430,195 | 149,724 |
* Genentech, Inc. | 413,900 | 19,536 |
14
U.S. Growth Fund | Shares | Market Value^ (000) |
---|---|---|
Drugs & Pharmaceuticals (5.3%) | ||
Teva Pharmaceutical | ||
Industries Ltd. | ||
Sponsored ADR | 3,781,000 | $ 113,846 |
* Forest Laboratories, Inc. | 2,378,300 | 101,553 |
Pfizer Inc. | 1,433,965 | 37,699 |
Eli Lilly & Co. | 607,275 | 34,007 |
Allergan, Inc. | 437,895 | 32,921 |
Electronics-Medical Systems (1.5%) | ||
Medtronic, Inc. | 1,671,376 | 87,112 |
Health & Personal Care (2.4%) | ||
* WellPoint, Inc. | 1,192,636 | 145,573 |
Health Care Management Services (4.8%) | ||
UnitedHealth Group Inc. | 2,227,298 | 203,040 |
* Caremark Rx, Inc. | 2,149,843 | 82,296 |
Medical & Dental Instruments & Supplies (9.3%) | ||
Zimmer Holdings, Inc. | 2,390,670 | 205,359 |
Alcon, Inc. | 1,614,045 | 139,292 |
* St.Jude Medical, Inc. | 2,589,700 | 101,257 |
Stryker Corp. | 1,992,100 | 98,928 |
Boston Scientific Corp. | 439,080 | 14,340 |
1,566,483 | ||
Integrated Oils (0.4%) | ||
Suncor Energy, Inc. | 577,175 | 22,539 |
Other Energy (1.5%) | ||
Schlumberger Ltd. | 597,000 | 45,044 |
Baker Hughes, Inc. | 923,700 | 43,673 |
88,717 | ||
Materials & Processing (0.8%) | ||
Praxair, Inc. | 1,125,060 | 50,436 |
Producer Durables (5.7%) | ||
Danaher Corp. | 2,952,591 | 159,942 |
Centex Corp. | 1,185,300 | 75,373 |
Lennar Corp. Class A | 1,167,500 | 71,007 |
D. R. Horton, Inc. | 725,500 | 31,748 |
338,070 | ||
Technology (23.6%) | ||
Communications Technology (4.6%) | ||
Juniper Networks, Inc. | 6,543,700 | 140,951 |
QUALCOMM Inc. | 1,850,300 | 66,814 |
Corning, Inc. | 5,516,800 | 63,278 |
Computer Services Software & Systems (5.5%) | ||
Symantec Corp. | 5,289,100 | 116,413 |
SAP AG ADR | 1,835,700 | 74,438 |
Accenture Ltd. | 2,363,275 | 60,382 |
* Intuit, Inc. | 923,040 | 39,506 |
Microsoft Corp. | 1,556,689 | 39,197 |
Computer Technology (6.2%) | ||
Dell Inc. | 6,456,495 | 258,841 |
EMC Corp. | 4,925,920 | 62,362 |
* Network Appliance, Inc. | 865,200 | 25,965 |
Apple Computer, Inc. | 555,000 | 24,897 |
Electronics-Semiconductors/Components (7.3%) | ||
* Marvell Technology Group Ltd. | 4,729,780p | 173,063 |
Broadcom Corp. | 3,610,300 | 116,432 |
Taiwan Semiconductor | ||
Manufacturing Co. Ltd. ADR | 6,234,505 | 56,859 |
Linear Technology Corp. | 1,368,586 | 53,457 |
Intel Corp. | 1,507,660 | 36,154 |
1,409,009 | ||
Utilities (0.8%) | ||
* Comcast Corp. Special Class A | 1,427,225las | 45,471 |
Other (1.8%) | ||
3M Co. | 732,670 | 61,500 |
General Electric Co. | 1,390,640 | 48,951 |
110,451 | ||
TOTAL COMMON STOCKS | ||
(Cost $5,132,045) | 5,711,239 | |
TEMPORARY INVESTMENTS (3.3%)(1) | ||
Exchange-Traded Fund (0.0%) | ||
Vanguard Index Participation | ||
Equity Receipts-Growth | 3,100 | 156 |
Money Market Fund (2.9%) | ||
Vanguard Market Liquidity | ||
Fund, 2.540%** | 172,604,586 | 172,605 |
Face | ||
Amount | ||
(000) | ||
U.S. Agency Obligation (0.4%) | ||
Federal Home Loan Mortgage Corp.† | ||
(2) 2.510%, 4/26/2 | $25,000 | 24,892 |
TOTAL TEMPORARY INVESTMENTS | ||
(Cost $197,663) | 197,653 | |
TOTAL INVESTMENTS (98.8%) | ||
(Cost $5,329,708) | 5,908,892 | |
15
U.S. Growth Fund | Market Value^ (000) |
---|---|
OTHER ASSETS AND LIABILITIES (1.2%) | |
Other Assets-Note C | $119,069 |
Liabilities | (45,271) |
73,798 | |
NET ASSETS (100%) | $5,982,690 |
^See Note A in Notes to Financial Statements. | |
*Non-income-producing security. | |
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. | |
†The issuer operates under a congressional charter; its securities are neither issued nor guaranteed by the U.S. government. If needed, access to additional funding (beyond the issuer's line of credit) would require congressional action. | |
(1)The fund invests a portion of its cash reserves in equity markets through the use of index futures contracts and exchange-traded funds. After giving effect to these investments, the fund's effective common stock and temporary cash investment positions represent 99.0% and -0.2%, respectively, of net assets. See Note E in Notes to Financial Statements. | |
(2)Security segregated as initial margin for open futures contracts. | |
ADR-American Depositary Receipt. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | 12,674,996 |
Overdistributed Net Investment Income | (13,784) |
Accumulated Net Realized Losses | (7,251,012) |
Unrealized Appreciation (Depreciation) | |
Investment Securities | 579,184 |
Futures Contracts | (6,694) |
NET ASSETS | $5,982,690 |
Investor Shares-Net Assets | |
Applicable to 329,451,353 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $5,184,259 |
NET ASSET VALUE PER SHARE- | |
INVESTOR SHARES | $15.74 |
Admiral Shares-Net Assets | |
Applicable to 19,594,458 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $798,431 |
NET ASSET VALUE PER SHARE- | |
ADMIRAL SHARES | $40.75 |
See Note E in Notes to Financial Statements for the tax-basis components of net assets. |
16
STATEMENT OF OPERATIONS
This Statement shows the types of income earned by the fund during the reporting period, and details the operating expenses charged to each class of its shares. These expenses directly reduce the amount of investment income available to pay to shareholders as income dividends. This Statement also shows any Net Gain (Loss) realized on the sale of investments, and the increase or decrease in the Unrealized Appreciation (Depreciation) of investments during the period.
| U.S. Growth Fund Six Months Ended February 28, 2005 (000) |
---|---|
INVESTMENT INCOME | |
Income | |
Dividends | $24,424 |
Interest | 2,643 |
Security Lending | 6 |
Total Income | 27,073 |
Expenses | |
Investment Advisory Fees-Note B | |
Basic Fee | 4,575 |
Performance Adjustment | (901) |
The Vanguard Group-Note C | |
Management and Administrative | |
Investor Shares | 10,712 |
Admiral Shares | 736 |
Marketing and Distribution | |
Investor Shares | 400 |
Admiral Shares | 82 |
Custodian Fees | 37 |
Shareholders' Reports | |
Investor Shares | 81 |
Admiral Shares | — |
Trustees' Fees and Expenses | 7 |
Total Expenses | 15,729 |
Expenses Paid Indirectly-Note D | (950) |
Net Expenses | 14,779 |
NET INVESTMENT INCOME | 12,294 |
REALIZED NET GAIN (LOSS) | |
Investment Securities Sold | 85,727 |
Futures Contracts | 18,179 |
REALIZED NET GAIN (LOSS) | 103,906 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | |
Investment Securities | 475,612 |
Futures Contracts | (4,093) |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | 471,519 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $587,719 |
17
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how the fund’s total net assets changed during the two most recent reporting periods. The Operations section summarizes information detailed in the Statement of Operations. The amounts shown as Distributions to shareholders from the fund’s net income and capital gains may not match the amounts shown in the Operations section, because distributions are determined on a tax basis and may be made in a period different from the one in which the income was earned or the gains were realized on the financial statements. The Capital Share Transactions section shows the net amount shareholders invested in or redeemed from the fund. Distributions and Capital Share Transactions are shown separately for each class of shares.
U.S. Growth Fund | ||
---|---|---|
| Six Months Ended Feb. 28, 2005 (000) | Year Ended Aug. 31, 2004 (000) |
INCREASE (DECREASE) IN NET ASSETS | ||
Operations | ||
Net Investment Income | $12,294 | 15,657 |
Realized Net Gain (Loss) | 103,906 | (10,179) |
Change in Unrealized Appreciation (Depreciation) | 471,519 | 248,180 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 587,719 | 253,658 |
Distributions | ||
Net Investment Income | ||
Investor Shares | (15,121) | (19,232) |
Admiral Shares | (4,423) | (5,426) |
Realized Capital Gain | ||
Investor Shares | — | — |
Admiral Shares | — | — |
Total Distributions | (19,544) | (24,658) |
Capital Share Transactions-Note G | ||
Investor Shares | (809,727) | (580,200) |
Admiral Shares | (102,441) | (285,822) |
Net Increase (Decrease) from Capital Share Transactions | (912,168) | (866,022) |
Total Increase (Decrease) | (343,993) | (637,022) |
Net Assets | ||
Beginning of Period | 6,326,683 | 6,963,705 |
End of Period | $5,982,690 | $6,326,683 |
18
FINANCIAL HIGHLIGHTS
This table summarizes the fund’s investment results and distributions to shareholders on a per-share basis for each class of shares. It also presents the Total Return and shows net investment income and expenses as percentages of average net assets. These data will help you assess: the variability of the fund’s net income and total returns from year to year; the relative contributions of net income and capital gains to the fund’s total return; how much it costs to operate the fund; and the extent to which the fund tends to distribute capital gains. The table also shows the Portfolio Turnover Rate, a measure of trading activity. A turnover rate of 100% means that the average security is held in the fund for one year.
U.S. Growth Fund Investor Shares | ||||||
---|---|---|---|---|---|---|
| Six Months Ended | Year Ended August 31, | ||||
For a Share Outstanding Throughout Each Period | Feb. 28, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 |
Net Asset Value, Beginning of Period | $14.39 | $14.00 | $12.92 | $18.00 | $49.26 | $38.92 |
Investment Operations | ||||||
Net Investment Income | .025* | .028 | .040 | .031 | .039 | .10 |
Net Realized and Unrealized Gain (Loss) on Investments | 1.370 | .409 | 1.082 | (5.075) | (23.799) | 12.47 |
Total from Investment Operations | 1.395 | .437 | 1.122 | (5.044) | (23.760) | 12.57 |
Distributions | ||||||
Dividends from Net Investment Income | (.045) | (.047) | (.042) | (.036) | (.050) | (.21) |
Distributions from Realized Capital Gains | — | — | — | — | (7.450) | (2.02) |
Total Distributions | (.045) | (.047) | (.042) | (.036) | (7.500) | (2.23) |
Net Asset Value, End of Period | $15.74 | $14.39 | $14.00 | $12.92 | $18.00 | $49.26 |
Total Return | 9.69% | 3.11% | 8.73% | -28.09% | -54.07% | 33.29% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $5,184 | $5,503 | $5,892 | $5,472 | $9,681 | $22,331 |
Ratio of Total Expenses to | ||||||
Average Net Assets** | 0.54%† | 0.53% | 0.55% | 0.50% | 0.44% | 0.38% |
Ratio of Net Investment Income to | ||||||
Average Net Assets | 0.26%*† | 0.19% | 0.32% | 0.20% | 0.13% | 0.24% |
Portfolio Turnover Rate | 39%† | 71% | 47% | 53% | 135% | 76% |
*Net investment income per share and the ratio of net investment income to average net assets include $.02 and 0.11%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. | ||||||
**Includes performance-based investment advisory fee increases (decreases) of (0.03%), (0.03%), (0.02%), 0.00%, 0.00%, and 0.00%. | ||||||
†Annualized. |
19
FINANCIAL HIGHLIGHTS (CONTINUED) | |||||
---|---|---|---|---|---|
U.S. Growth Fund Admiral Shares | |||||
| Six Months Ended | Year Ended August 31, | Aug.13* to Aug. 31, | ||
For a Share Outstanding Throughout Each Period | Feb. 28, 2005 | 2004 | 2003 | 2002 | 2001 |
Net Asset Value, Beginning of Period | $37.29 | $36.28 | $33.46 | $46.59 | $50.00 |
Investment Operations | |||||
Net Investment Income | .124** | .147 | .164 | .168 | .022 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.545 | 1.052 | 2.811 | (13.167) | (3.432 |
Total from Investment Operations | 3.669 | 1.199 | 2.975 | (12.999) | (3.410 |
Distributions | |||||
Dividends from Net Investment Income | (.209) | (.189) | (.155) | (.131) | — |
Distributions from Realized Capital Gains | — | — | — | — | — |
Total Distributions | (.209) | (.189) | (.155) | (.131) | — |
Net Asset Value, End of Period | $40.75 | $37.29 | $36.28 | $33.46 | $46.59 |
Total Return | 9.83% | 3.29% | 8.95% | -27.99% | -6.82% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $798 | $824 | $1,071 | $1,069 | $262 |
Ratio of Total Expenses to Average Net Assets† | 0.32%†† | 0.32% | 0.37% | 0.36% | 0.38%†† |
Ratio of Net Investment Income to Average Net Assets | 0.49%**†† | 0.40% | 0.50% | 0.37% | 0.35%†† |
Portfolio Turnover Rate | 39%†† | 71% | 47% | 53% | 135% |
*Inception | |||||
**Net investment income per share and the ratio of net investment income to average net assets include $.05 and 0.11%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. | |||||
†Includes performance-based investment advisory fee increases (decreases) of (0.03%), (0.03%), (0.02%), 0.00%, and 0.00%. | |||||
††Annualized |
SEE ACCOMPANYING NOTES, WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
20
NOTES TO FINANCIAL STATEMENTS
Vanguard U.S. Growth Fund is registered under the Investment Company Act of 1940 as an open-end investment company, or mutual fund. The fund offers two classes of shares, Investor Shares and Admiral Shares. Investor Shares are available to any investor who meets the fund’s minimum purchase requirements. Admiral Shares are designed for investors who meet certain administrative, servicing, tenure, and account-size criteria.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S. mutual funds. The fund consistently follows such policies in preparing its financial statements.
1. | Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been materially affected by events occurring before the fund's pricing time but after the close of the securities' primary markets, are valued by methods deemed by the board of trustees to represent fair value. Investments in Vanguard Market Liquidity Fund are valued at the fund's net asset value. Temporary cash investments acquired over 60 days to maturity are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Other temporary cash investments are valued at amortized cost, which approximates market value. |
2. | Futures Contracts: The fund uses Nasdaq 100 Index futures contracts to a limited extent, with the objective of maintaining full exposure to the stock market while maintaining liquidity. The fund may purchase or sell futures contracts to achieve a desired level of investment, whether to accommodate portfolio turnover or cash flows from capital share transactions. The primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks held by the fund and the prices of futures contracts, and the possibility of an illiquid market. |
Futures contracts are valued at their quoted daily settlement prices. The aggregate principal amounts of the contracts are not recorded in the financial statements. Fluctuations in the value of the contracts are recorded in the Statement of Net Assets as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized futures gains (losses). |
3. | Federal Income Taxes The fund intends to continue to qualify as a regulated investment company and distribute all of its taxable income. Accordingly, no provision for federal income taxes is required in the financial statements. |
4. | Distributions: Distributions to shareholders are recorded on the ex-dividend date. |
5. | Security Lending: The fund may lend its securities to qualified institutional borrowers to earn additional income. Security loans are required to be secured at all times by collateral at least equal to the market value of securities loaned. The fund invests cash collateral received in Vanguard Market Liquidity Fund, and records a liability for the return of the collateral, during the period the securities are on loan. Security lending income represents the income earned on investing cash collateral, less expenses associated with the loan. |
6. | Other: Dividend income is recorded on the ex-dividend date. Interest income includes income distributions received from Vanguard Market Liquidity Fund and is accrued daily. Security transactions |
21
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
are accounted for on the date securities are bought or sold. Costs used to determine realized gains (losses) on the sale of investment securities are those of the specific securities sold. |
Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees. Income, other non-class-specific expenses, and gains and losses on investments are allocated to each class of shares based on its relative net assets. |
B. Alliance Capital Management L.P. and William Blair & Company, LLC, 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 fee for Alliance Capital Management is subject to quarterly adjustments based on performance for the preceding three years relative to the Russell 1000 Growth Index. In accordance with the advisory contract entered into with William Blair & Company in April 2004, the investment advisory fee will be subject to quarterly adjustments based on performance relative to the Russell 1000 Growth Index beginning March 1, 2005.
The Vanguard Group manages the cash reserves of the portfolio on an at-cost basis.
For the six months ended February 28, 2005, the investment advisory fee represented an effective annual basic rate of 0.15% of the fund’s average net assets before a decrease of $901,000 (0.03%) based on performance.
C. The Vanguard Group furnishes at cost corporate management, administrative, marketing, and distribution services. The costs of such services are allocated to the fund under methods approved by the board of trustees. The fund has committed to provide up to 0.40% of its net assets in capital contributions to Vanguard. At February 28, 2005, the fund had contributed capital of $787,000 to Vanguard (included in Other Assets), representing 0.01% of the fund’s net assets and 0.79% of Vanguard’s capitalization. The fund’s trustees and officers are also directors and officers of Vanguard.
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. The fund’s custodian bank has also agreed to reduce its fees when the fund maintains cash on deposit in the non-interest-bearing custody account. For the six months ended February 28, 2005, these arrangements reduced the fund’s management and administrative expenses by $948,000 and custodian fees by $2,000. The total expense reduction represented an effective annual rate of 0.03% of the fund’s average net assets.
E. Distributions are determined on a tax basis and may differ from net investment income and realized capital gains for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain, or loss are recognized in different periods for financial statement and tax purposes; these differences will reverse at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.
During 2002, the fund elected to use a provision of the Taxpayer Relief Act of 1997 to mark-to-market certain appreciated securities held on January 1, 2001; such securities were treated as sold and repurchased, with unrealized gains of $912,491,000 becoming realized and reducing the fund’s capital loss carryforward, for tax purposes. The mark-to-market had no effect on realized gains or unrealized appreciation for financial statement purposes; it created a difference between the cost of investments
22
for financial statement and tax purposes, which reverses as the securities are sold. The fund realized gains on the sale of these securities through August 31, 2004, and subsequently during the six months ended February 28, 2005, of $768,896,000 and $143,595,000, respectively, for financial statement purposes, which were included in fiscal 2001 mark-to-market gains for tax purposes. All affected securities have been sold as of February 28, 2005.
The fund’s tax-basis capital gains and losses are determined only at the end of each fiscal year. For tax purposes, at August 31, 2004, the fund had available realized losses of $7,213,242,000 to offset future net capital gains of $3,610,329,000 through August 31, 2010, $2,548,333,000 through August 31, 2011, $887,490,000 through August 31, 2012, and $167,090,000 through August 31, 2013. The fund will use these capital losses to offset net taxable capital gains, if any, realized during the year ending August 31, 2005; should the fund realize net capital losses for the year, the losses will be added to the loss carryforward balances above.
At February 28, 2005, net unrealized appreciation of investment securities for tax purposes was $579,184,000, consisting of unrealized gains of $797,376,000 on securities that had risen in value since their purchase and $218,192,000 in unrealized losses on securities that had fallen in value since their purchase.
At February 28, 2005, the aggregate settlement value of open futures contracts expiring in March 2005 and the related unrealized appreciation (depreciation) were:
(000) | |||
---|---|---|---|
Futures Contracts | Number of Long Contracts | Aggregate Settlement Value | Unrealized Appreciation (Depreciation) |
Nasdaq 100 E-Mini | 6,800 | $205,768 | $(6,457) |
Nasdaq 100 | 20 | 3,026 | (237) |
Unrealized appreciation (depreciation) on open futures contracts is required to be treated as realized gain (loss) for tax purposes.
F. During the six months ended February 28, 2005, the fund purchased $1,137,081,000 of investment securities and sold $2,042,002,000 of investment securities other than temporary cash investments.
G. Capital share transactions for each class of shares were:
| Six Months Ended February 28, 2005 | Year Ended August 31, 2004 | ||
---|---|---|---|---|
| Amount (000) | Shares (000) | Amount (000) | Shares (000) |
Investor Shares | ||||
Issued | $ 362,234 | 23,457 | $ 965,844 | 64,528 |
Issued in Lieu of Cash Distributions | 14,787 | 918 | 18,819 | 1,270 |
Redeemed | (1,186,748) | (77,431) | (1,564,863) | (104,161) |
Net Increase (Decrease)-Investor Shares | (809,727) | (53,056) | (580,200) | (38,363) |
Admiral Shares | ||||
Issued | 78,338 | 1,948 | 269,599 | 6,862 |
Issued in Lieu of Cash Distributions | 4,233 | 102 | 5,262 | 137 |
Redeemed | (185,012) | (4,546) | (560,683) | (14,438) |
Net Increase (Decrease)-Admiral Shares | (102,441) | (2,496) | (285,822) | (7,439) |
23
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24
INVEST WITH VANGUARD FOR YOUR RETIREMENT | |
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• Vanguard mutual funds | |
Select from our comprehensive lineup of more than 70 low-cost mutual funds suitable for retirement investing—all with no sales commissions—to help you reach your retirement goals. We offer a broad selection of stock, bond, balanced, and money market funds. | |
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• Other investment options | |
Consolidate and build your portfolio in a single account that provides access to the universe of stocks, bonds, options, certificates of deposit (CDs), exchange-traded funds (ETFs), and non-Vanguard mutual funds through Vanguard Brokerage Services®. | |
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When you change jobs or retire, you can take greater control of your investments by rolling over your assets in an employer-sponsored retirement plan to a Vanguard IRA. To initiate a rollover, visit Vanguard.com, where you can complete our easy online application. You can also print out the application and mail it to us—or call a Vanguard retirement specialist at 800-205-6189. | |
For more information, visit www.vanguard.com, or call 800-662-7447 for Vanguard funds and 800-992-8327 for non-Vanguard funds offered through Vanguard Brokerage Services, to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing. |
MAXIMIZE YOUR RETIREMENT INVESTMENTS | |
Are you taking full advantage of your IRA? You should be. With increased contribution limits, these tax-advantaged accounts are powerful options for retirement savers. To take full advantage of your retirement account, consider these simple, but important, steps: | |
• Contribute the maximum amount each year. | |
If you invest as much in your IRA as the law allows—$3,000 for 2004 and $4,000 for 2005 if you are under the age of 50, and $3,500 and $4,500, respectively, if you are aged 50 or older—you will increase your chances of meeting your retirement goals. Provided you meet the eligibility requirements, max out your contribution every year you can. | |
• Make automatic contributions. | |
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Unless you’ve invested in a Vanguard Target Retirement Fund, you should rebalance your account periodically to ensure that your target asset allocations are aligned to meet your retirement objectives. | |
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• Adopt a long-term approach. | |
A successful investment strategy requires a long-term perspective and staying on course—even when the financial markets are declining. Market-timing and performance-chasing are losing strategies that can cause you to stray from the path to your retirement goals. | |
If you have any questions about IRAs or would like to talk to a Vanguard retirement specialist, call 800-205-6189. |
THIS PAGE INTENTIONALLY LEFT BLANK.
THE PEOPLE WHO GOVERN YOUR FUND
The trustees of your mutual fund are there to see that the fund is operated and managed in your best interests since, as a shareholder, you are a part owner of the fund. Your fund trustees also serve on the board of directors of The Vanguard Group, Inc., which is owned by the Vanguard funds and provides services to them on an at-cost basis. | |
A majority of Vanguard's board members are independent, meaning that they have no affiliation with Vanguard or the funds they oversee, apart from the sizable personal investments they have made as private individuals. | |
Our independent board members bring distinguished backgrounds in business, academia, and public service to their task of working with Vanguard officers to establish the policies and oversee the activities of the funds. Among board members’ responsibilities are | |
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
John J. Brennan* (1954) May 1987 | Chairman of the Board, Chief Executive Officer, and Trustee (132) | Chairman of the Board,Chief Executive Officer, and Director/Trustee of The Vanguard Group, Inc., and of each of the investment companies served by The Vanguard Group. |
INDEPENDENT TRUSTEES | ||
Charles D. Ellis (1937) January 2001 | Trustee (132) | The Partners of `63 (pro bono ventures in education); Senior Advisor to Greenwich Associates (international business strategy consulting); Successor Trustee of Yale University; Overseer of the Stern School of Business at New York University; Trustee of the Whitehead Institute for Biomedical Research. |
Rajiv L. Gupta (1945) December 2001** | Trustee (132) | Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Board Member of the American Chemistry Council; Trustee of Drexel University and of the Chemical Heritage Foundation. |
JoAnn Heffernan Heisen (1950) July 1998 | Trustee (132) | Vice President, Chief Information Officer, and Member of the Executive Committee of Johnson & Johnson (pharmaceuticals/ consumer products); Director of the University Medical Center at Princeton and Women's Research and Education Institute. |
Burton G. Malkiel (1932) May 1977 | Trustee (129) | Chemical Bank Chairman's Professor of Economics, Princeton University; Director of Vanguard Investment Series plc (Irish invest- ment fund) (since November 2001), Vanguard Group (Ireland) Limited (investment management) (since November 2001), BKF Capital (investment management), The Jeffrey Co. (holding company), and CareGain, Inc. (health care management). |
André F. Perold (1952) December 2004 | Trustee (132) | George Gund Professor of Finance and Banking, Harvard Business School (since 2000); Senior Associate Dean, Director of Faculty Recruiting, and Chair of Finance Faculty, Harvard Business School; Director and Chairman of UNX, Inc. (equities trading firm) (since 2003); Director of registered investment companies advised by Merrill Lynch Investment Managers and affiliates (1985–2004), Genbel Securities Limited (South African financial services firm) (1999–2003), Gensec Bank (1999–2003), Sanlam Investment Management (1999–2001), Sanlam, Ltd. (South African insurance company) (2001–2003), Stockback, Inc. (credit card firm) (2000–2002), and Bulldogresearch.com (investment research) (1999–2001); and Trustee of Commonfund (investment management) (1989–2001). |
selecting investment advisors for the funds; monitoring fund operations, performance, and costs; reviewing contracts; nominating and selecting new trustees/directors; and electing Vanguard officers. | |
Each trustee serves a fund until its termination; or until the trustee’s retirement, resignation, or death; or otherwise as specified in the fund’s organizational documents. Any trustee may be removed at a shareholders’ meeting by a vote representing two-thirds of the net asset value of all shares of the fund together with shares of other Vanguard funds organized within the same trust. The table on these two pages shows information for each trustee and executive officer of the fund. The mailing address of the trustees and officers is P.O. Box 876, Valley Forge, PA 19482. |
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
Alfred M. Rankin, Jr. (1941) January 1993 | Trustee (132) | Chairman, President, Chief Executive Officer, and Director of NACCO Industries, Inc. (forklift trucks/housewares/lignite); Director of Goodrich Corporation (industrial products/aircraft systems and services); Director of Standard Products Company (supplier for the automotive industry) until 1998. |
J. Lawrence Wilson (1936) April 1985 | Trustee (132) | Retired Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Director of Cummins Inc. (diesel engines), MeadWestvaco Corp. (packaging products), and AmerisourceBergen Corp. (pharmaceutical distribution); Trustee of Vanderbilt University and of Culver Educational Foundation. |
EXECUTIVE OFFICERS* | ||
R. Gregory Barton (1951) June 2001 | Secretary (132) | Managing Director and General Counsel of The Vanguard Group, Inc.; Secretary of The Vanguard Group, Inc. and of each of the investment companies served by The Vanguard Group since June 2001. |
Thomas J. Higgins (1957) July 1998 | Treasurer (132) | Principal of The Vanguard Group, Inc.; Treasurer of each of the investment companies served by The Vanguard Group. |
*Officers of the funds are “interested persons” as defined in the Investment Company Act of 1940. | ||
**December 2002 for Vanguard Equity Income Fund, Vanguard Growth Equity Fund, the Vanguard Municipal Bond Funds, and the Vanguard State Tax-Exempt Funds. | ||
More information about the trustees is in the Statement of Additional Information, available from The Vanguard Group. |
VANGUARD SENIOR MANAGEMENT TEAM | |
---|---|
Mortimer J. Buckley, Information Technology. James H. Gately, Investment Programs and Services. Kathleen C. Gubanich, Human Resources. F. William McNabb, III, Client Relationship Group. | Michael S. Miller, Planning and Development. Ralph K. Packard, Finance. George U. Sauter, Chief Investment Officer. |
John C. Bogle, Founder; Chairman and Chief Executive Officer, 1974-1996. | |
![]() Post Office Box 2600 Valley Forge, PA 19482-2600 | |
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Vanguard, The Vanguard Group, Vanguard.com, Vanguard Brokerage Services, Vanguard IRA, Admiral, PlainTalk, and the ship logo are trademarks of The Vanguard Group, Inc. | World Wide Web www.vanguard.com |
All other marks are the exclusive property of their respective owners. | |
All comparative mutual fund data are from Lipper Inc. or Morningstar, Inc., unless otherwise noted. | Fund Information 800-662-7447 |
For More Information This report is intended for the funds' shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current fund prospectus. To receive a free copy of the prospectus or the Statement of Additional Information, or to request additional information about the funds or other Vanguard funds, please contact us at one of the adjacent telephone numbers or by e-mail through Vanguard.com. Prospectuses may also be viewed online. | Direct Investor Account Services 800-662-2739 |
You can obtain a free copy of Vanguard's proxy voting guidelines by visiting our website, www.vanguard.com, and searching for "proxy voting guidelines," or by calling Vanguard at 800-662-2739. They are also available from the SEC's website, www.sec.gov. In addition, you may obtain a free report on how your fund voted the proxies for securities it owned during the 12 months ended June 30. To get the report, visit either www.vanguard.com or www.sec.gov. | Institutional Investor Services 800-523-1036 |
You can review and copy information about your fund at the SEC's Public Reference Room in Washington, D.C. To find out more about this public service, call the SEC at 202-942- 8090. Information about your fund is also available on the SEC's website, and you can receive copies of this information, for a fee, by sending a request in either of two ways: via e-mail addressed to publicinfo@sec.gov or via regular mail addressed to the Public Reference Section, Securities and Exchange Commission, Washington, DC 20549-0102. | Text Telephone 800-952-3335 |
© 2005 The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. | |
Q232 042005 |
Vanguard®International Growth Fund | |
February 28, 2005 |
![Semiannual Report Semiannual Report](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/frontcover.gif)
![Your Fund Report Your Fund Report](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/yourfundreport.gif)
CONTENTS | |
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1 | CHAIRMAN'S LETTER |
5 | ADVISOR'S REPORT |
8 | FUND PROFILE |
10 | GLOSSARY OF INVESTMENT TERMS |
11 | PERFORMANCE SUMMARY |
12 | ABOUT YOUR FUND'S EXPENSES |
14 | FINANCIAL STATEMENTS |
27 | ADVANTAGES OF VANGUARD.COM |
SUMMARY | |
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• | International Growth Fund delivered strong six-month returns, but trailed its comparative standards. |
• | The fund's modest underperformance was due to several factors, including a light weighting in European stocks. |
• | The six-month results reflected both strong stock market performance and currency returns. |
VANGUARD’S PLEDGE TO CLIENTS | |
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We recognize that your relationship with Vanguard rests on the twin pillars of trust and excellence, each of which is built upon the character of our people. Our Pledge to Clients reflects our ongoing efforts to deserve your trust and to continually improve so that we can offer you excellence in all that we do. We will: | |
• | Put your interests first at all times. |
• | Continually seek to earn your trust by adhering to the highest standards of ethical behavior and fiduciary responsibility. |
• | Strive to be the highest-value provider of investment services, which means outstanding investment performance and service, both at the lowest possible cost. |
• | Communicate candidly not only about the rewards of investing but also about the risks and costs. |
• | Maintain highly effective controls to safeguard your assets and protect your confidential information. |
• | Invest a majority of our personal assets alongside yours. |
Please note: The opinions expressed in this report are just that—informed opinions. They should not be considered promises or advice. Also, please keep in mind that the information and opinions cover the period through the date on the cover of this report. Of course, the risks of investing in your fund are spelled out in the prospectus. | |
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CHAIRMAN’S LETTER
![Picture of John J. Brennan Picture of John J. Brennan](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/picturebrennanfinal.gif)
Dear Shareholder,
During the past six months, global stock markets delivered broad-based gains, with shares of energy and raw-materials producers leading the advance.
Strong local-currency returns in the major international markets became very strong dollar-denominated gains as the greenback’s relative value declined. (A weakening U.S. dollar means that assets priced in other currencies can be converted into an increasing number of dollars.)
Total Returns | Six Months Ended February 28, 2005 | ||
---|---|---|---|
Vanguard International Growth Fund | |||
Investor Shares | 19.8 | % | |
Admiral Shares | 19.9 | ||
MSCI EAFE Index | 21.2 | ||
Average International Fund* | 20.3 | ||
MSCI All Country World Index ex USA 22.8 | |||
*Derived from data provided by Lipper Inc. |
Vanguard International Growth Fund participated in the rally, but its six-month return was a bit shy of the results registered by its comparative standards, in large part because the fund was light in basic industries such as raw-materials producers and some of the European markets' strongest performers.
The total returns of your fund and its comparative standards appear in the table above. The fund's distributions and its share prices at the beginning and end of the period are shown in the table on page 4.
GLOBAL STOCK MARKETS RALLIED
Both U.S. and international stocks produced strong returns during the fiscal half-year. Despite worrisome signals from the labor market and some inflation indicators, U.S. economic growth was strong; most other developed markets experienced weaker expansions. Corporate profits and stock market performance were more impressive, both at home and abroad. The overall U.S. stock market, as measured by the Dow Jones Wilshire 5000 Composite Index, returned 11.6%. The major European and Pacific markets returned 21.2% in U.S. dollars, as measured by the Morgan Stanley Capital International Europe,
1
Admiral™Shares
A lower-cost class of shares available to many longtime shareholders and to those with significant investments in the fund.
Australasia, Far East (MSCI EAFE) Index. Emerging markets did even better: The smaller stock exchanges in Europe and Latin America produced six-month returns of more than 35%.
U.S. BOND YIELDS ROSE, EXCEPT FOR LONG-TERM ISSUES
Global fixed income markets were subdued, with most of the drama confined to the United States, where the Federal Reserve Board continued to boost short-term interest rates. The Fed increased its target for the federal funds rate by a full percentage point, from 1.50% to 2.50%, during the six months. The yield of the 3-month U.S. Treasury bill, a proxy for money market yields, rose 117 basis points (1.17 percentage points) to 2.75%. The yield of the 10-year Treasury note rose 26 basis points to 4.38%. However, yields of longer-term bonds, which are less sensitive to Fed actions, were lower at the end of the period than at the beginning.
KEY INVESTMENT THEMES DROVE THE FUND'S PERFORMANCE
During the first six months of fiscal 2005, the Investor Shares of Vanguard International Growth Fund returned 19.8% and the Admiral Shares 19.9%. As noted earlier, these returns reflected both strong gains in international markets and the U.S. dollar's depreciation relative to most major currencies. The fund's six-month results modestly trailed the average 20.3% return of competing funds and the 21.2% gain of the MSCI EAFE Index.
Market Barometer | Total Returns Periods Ended February 28, 2005 | ||||||
---|---|---|---|---|---|---|---|
Six Months | One Year | Five Years* | |||||
Stocks | |||||||
MSCI All Country World Index | |||||||
ex USA (International) | 22.8 | % | 20.1 | % | 1.2 | % | |
Russell 1000 Index (Large-caps) | 10.8 | 7.5 | -0.9 | ||||
Russell 2000 Index (Small-caps) | 16.4 | 9.5 | 3.2 | ||||
Dow Jones Wilshire 5000 Index | 11.6 | 7.9 | -1.2 | ||||
(Entire market) | |||||||
Bonds | |||||||
Lehman Aggregate Bond Index | 1.3 | % | 2.4 | % | 7.5 | % | |
(Broad taxable market) | |||||||
Lehman Municipal Bond Index | 2.4 | 3.0 | 7.2 | ||||
Citigroup 3-Month Treasury Bill Index | 0.9 | 1.4 | 2.7 | ||||
CPI | |||||||
Consumer Price Index | 1.2 | % | 3.0 | % | 2.5 | % | |
*Annualized |
In recent years, the International Growth Fund's performance has been driven by a few key investment themes: an emphasis on Asian technology stocks; investments in companies in developing Asia that stand to capitalize on the region's burgeoning
2
consumer class; and a shift away from continental Europe's slow-growing economic giants, particularly German companies.
During the past six months, the fund earned strong returns in emerging Asian markets, but weaker results from the broader Pacific region's technology holdings. The fund's comparatively light weighting in Europe can be best described as a missed short-term opportunity, in large part because investments in the Continent got a big boost from the U.S. dollar's decline. Other factors that kept the fund's returns slightly behind those of its comparative standards included poor performance in certain industries, such as health care, and the "opportunity cost" of holding some cash in a rising market. International Growth Fund's light weighting in raw-materials producers also restrained performance, though this positioning was hardly a misstep. These mature industries typically account for a relatively small portion of the fund's growth-oriented portfolio. For more information on your fund's strategy and investment selections, please see the Advisor's Report on page 5.
Six months' performance, whether good or bad, is too little to reveal anything meaningful about a mutual fund. Long-term returns, on the other hand, can reveal a lot--and in this case they provide an impressive testament to your fund's investment advisors and the strength of their carefully researched and disciplined approaches. Schroder Investment Management North America, which has managed the fund since its 1981 inception, oversees the majority of fund assets. Baillie Gifford, which joined the fund in 2003, manages the remainder. For a look at the fund's longer-term returns, please see the Performance Summary on page 11.
Fund Assets Managed | February 28, 2005 | |
---|---|---|
$ Million | Percentage | |
Schroder Investment Management | ||
North America Inc. | $7,199 | 72% |
Baillie Gifford Overseas Ltd. | 2,368 | 24 |
Cash Investments* | 416 | 4 |
Total | $9,983 | 100% |
* | These short-term reserves are invested by The Vanguard Group in equity index products to simulate investment in stocks. Each advisor also may maintain a modest cash position. |
REMEMBER THE GOLDEN MEAN
International stocks have outpaced their domestic counterparts recently, a reversal from the 1990s and the early years of the new millennium. Although the turnabout is interesting, and welcomed by investors who
3
have long maintained a commitment to international investments, it would be a mistake to treat the change as a signal for big shifts in your asset allocation. As always, the keys to investment success are balance and diversification. That means developing a low-cost mix of stock, bond, and money market funds in proportions suited to your unique circumstances.
In financial markets that vacillate between extremes, the formulation of such a plan can be informed by the wisdom of the ancient philosophers: The ideal is found in the mean between extremes. We thank you for entrusting your assets to Vanguard.
Sincerely,
![John J. Brennan John J. Brennan](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/signaturejjb.gif)
John J. Brennan
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
MARCH 11, 2005
Your Fund's Performance at a Glance | August 31, 2004-February 28, 2005 | |||
---|---|---|---|---|
Distributions Per Share | ||||
Starting Share Price | Ending Share Price | Income Dividends | Capital Gains | |
International Growth Fund | ||||
Investor Shares | $16.33 | $19.23 | $0.315 | $0.000 |
Admiral Shares | 51.96 | 61.15 | 1.095 | 0.000 |
4
ADVISOR’S REPORT
During the six months ended February 28, 2005, international stock markets broke successfully out of the range that bound them through the middle months of 2004. The continued fall in the U.S. dollar against the other major currencies gave a further boost to dollar-denominated returns. The Investor Shares of the International Growth Fund earned 19.8%, compared with the 20.3% return of the average international fund and the 21.2% rise in the MSCI EAFE Index.
This report focuses on the portion of the portfolio managed by Schroder Investment Management North America, representing 72% of the fund’s assets as of February 28.
THE INVESTMENT ENVIRONMENT
Non-U.S. developed markets benefited from two factors in the six months under review: the strength of demand outside their borders and the continued rise in corporate profits as companies maintained their relentless cost-cutting efforts to stay competitive. The environment was most favorable for companies benefiting from booming domestic demand in China and in the United States. The best performers included many “old economy” companies, such as those dealing in natural resources, construction materials, machinery, engineering, and trucks—industries that had seen relatively low levels of capital investment in recent years. For these groups, the upsurge in demand created sellers’ markets.
Investment Philosophy
The fund reflects a belief that superior long-term investment results can be achieved by selecting the stocks of companies with the potential for above-average earnings growth, with particular emphasis on companies in countries with favorable business and market environments.
However, strong exports have not yet clearly carried over into new jobs in Europe and Japan. Without this essential link in the economic chain, the benefits of a pickup in one sector do not feed into the broader economy. True, full-time jobs rose in Japan in January for the first time in eight years, and we hope that this marks the end of a tough time for consumers there, but in Europe there have been few signs of any improvement in the job market. As in Japan, European companies made excellent profits, but they lacked the confidence to expand
5
capacity and hire more labor. That said, stock markets are swayed more by the outlook for shorter-term profits, and this was extremely evident in the returns earned by investors in European stocks. Europe’s markets rose 15% in local currencies and 24% in dollars. The Japanese market, on the other hand, rose only 10% in dollar terms, of which half was currency appreciation. If Japan’s job market continues to strengthen, as we expect, the stock market should become more buoyant, in line with the profits outlook.
Six months ago, and indeed a year ago, we anticipated that the smaller companies that had led markets upward since March 2003 would cede leadership to larger companies. At the same time, we expected companies with strong business franchises and steadily high profitability to start to outperform. Neither has yet happened, a result of the resurgence of growth in China and the United States.
OUR SUCCESSES
There are six prominent policy positions in our portfolio, three of which succeeded over the past six months. First, we feel strongly that emerging markets, notably in Asia, should outperform the old world, notably countries such as Germany. This was the case over the period, but we expected and still expect more. Second, we continued to be nervous about the future profitability of pharmaceutical companies, and indeed they again underperformed. We have, however, started to buy selectively, as this theme may now be fully reflected in stock prices. Third, our large defensive position in consumer staples companies paid off through good stock selection in a sector that generally was out of favor with investors.
OUR FAILURES
The other three prominent policy positions did not work as expected over the period, largely because investors have been generally more risk-tolerant than we anticipated. First, our concern about Germany extends more broadly to the Eurozone, which is reforming too slowly to maintain its competitive position over the long term. Accordingly, we are very underweighted in Eurozone markets, and some of this money is invested instead in more flexible U.K. companies. Although this bet has been satisfactory over the past year, it was not so in the past
6
six months. Second, our concern about the financials sector’s high leverage and future profits was not shared by most investors. The sector is cyclical, and at some point investors will become concerned. Still, for the six months, our underweighted position was a negative even though the stocks we chose performed well. Third, the outperformance by basic industrial stocks, such as steel, mining, cement, and chemicals, continued, which is a problem for our growth-oriented style of fund.
OUR POSITIONING
The portfolio remains broadly defensive, as it was six months ago when I last wrote. Some good stock selection has compensated partially for a strategic position that has been inopportune.
We believe that many emerging countries will continue to be revalued upward as their greater financial stability and better economic-growth prospects are recognized, and the portfolio is positioned for that, notably in Asia and, indirectly, through companies based elsewhere that stand to capitalize on emerging markets’ growth.
Finally, the portfolio offers a sensible antidote to the conundrum posed by the strengths of the U.S. economy. In our opinion, significantly slower growth will be required to stop the balance-of-payments gap from deteriorating further, and we have an accordingly defensive position. In the event that there is no such slowdown, the dollar may continue to fall, and foreign stocks should still deliver better returns than U.S. stocks. I look forward to reporting on this in six months’ time.
Richard Foulkes, EXECUTIVE VICE PRESIDENT
SCHRODER INVESTMENT MANAGEMENT NORTH AMERICA INC.
MARCH 17, 2005
7
As of 2/28/2005 | FUND PROFILE This Profile provides a snapshot of the fund's characteristics, compared where indicated with both an appropriate market index and a broad market index. Key terms are defined on page 10. |
INTERNATIONAL GROWTH FUND | |||
---|---|---|---|
Portfolio Characteristics | Fund | Comparative Index* | Broad Index** |
Number of Stocks | 191 | 1,068 | 1,888 |
Turnover Rate | 46%† | — | — |
Expense Ratio | — | — | |
Investor Shares | 0.61%† | ||
Admiral Shares | 0.42%† | ||
Short-Term Reserves | 6% | — | — |
Volatility Measures | ||||
---|---|---|---|---|
Fund | Comparative Index* | Fund | Broad Index** | |
R-Squared | 0.97 | 1.00 | 0.97 | 1.00 |
Beta | 1.03 | 1.00 | 1.03 | 1.00 |
Sector Diversification (% of portfolio) | |||||||
---|---|---|---|---|---|---|---|
Fund | Comparative Index* | Broad Index** | |||||
Consumer Discretionary | 11 | % | 12 | % | 11 | % | |
Consumer Staples | 12 | 8 | 8 | ||||
Energy | 8 | 9 | 10 | ||||
Financials | 19 | 27 | 27 | ||||
Health Care | 5 | 8 | 7 | ||||
Industrials | 15 | 10 | 9 | ||||
Information Technology | 7 | 6 | 7 | ||||
Materials | 5 | 8 | 9 | ||||
Telecommunication Services | 7 | 7 | 7 | ||||
Utilities | 5 | 5 | 5 | ||||
Short-Term Reserves | 6 | % | — | — | |||
Sector percentages exclude futures and currency contracts held by the fund |
Ten Largest Holdings (% of total net assets) | |||
---|---|---|---|
Tesco PLC | 3.0 | % | |
(retail) | |||
Shell Transport & Trading Co. PLC | 2.3 | ||
(energy and utilities) | |||
Vodafone Group PLC | 2.2 | ||
(telecommunications) | |||
Royal Bank of Scotland Group PLC | 2.1 | ||
(banking) | |||
BG Group PLC | 1.7 | ||
(energy and utilities) | |||
Siemens AG | 1.7 | ||
(telecommunications) | |||
East Japan Railway Co. | 1.6 | ||
(transportation services) | |||
Allied Irish Banks PLC | 1.5 | ||
(banking) | |||
Mitsui & Co., Ltd. | 1.5 | ||
(energy and utilities) | |||
Nestle SA (Registered) | 1.4 | ||
(food, beverage, and tobacco) | |||
Top Ten | 19.0 | % | |
"Ten Largest Holdings" excludes any temporary cash investments and equity index products |
Allocation by Region (% of portfolio)
![Allocation by Region (% of portfolio) Allocation by Region (% of portfolio)](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/intlgrowth_pie.gif)
*MSCI EAFE Index.
**MSCI All Country World Index ex USA.
†Annualized.
Note: Short-term reserves exclude futures and currency contracts held by the fund.
8
Country Diversification (% of portfolio) | |||||||
---|---|---|---|---|---|---|---|
Fund | Comparative Index* | Broad Index** | |||||
EUROPE | |||||||
United Kingdom | 27 | % | 26 | % | 21 | % | |
France | 10 | 10 | 8 | ||||
Switzerland | 5 | 7 | 6 | ||||
Germany | 4 | 7 | 6 | ||||
Spain | 3 | 4 | 3 | ||||
Ireland | 3 | 1 | 1 | ||||
Netherlands | 3 | 5 | 4 | ||||
Sweden | 3 | 2 | 2 | ||||
Italy | 2 | 4 | 3 | ||||
Finland | 1 | 1 | 1 | ||||
Belgium | 0 | 1 | 1 | ||||
Denmark | 0 | 1 | 1 | ||||
Greece | 0 | 1 | 1 | ||||
Norway | 0 | 1 | 1 | ||||
Subtotal | 61 | % | 71 | % | 59 | % | |
PACIFIC | |||||||
Japan | 21 | % | 21 | % | 18 | % | |
Australia | 3 | 5 | 4 | ||||
Hong Kong | 1 | 2 | 1 | ||||
Singapore | 0 | 1 | 1 | ||||
Subtotal | 25 | % | 29 | % | 24 | % | |
EMERGING MARKETS | |||||||
South Korea | 3 | % | — | 2 | % | ||
Brazil | 1 | — | 1 | ||||
India | 1 | — | 1 | ||||
Taiwan | 1 | — | 1 | ||||
Indonesia | 1 | — | 0 | ||||
Mexico | 1 | — | 1 | ||||
China | 0 | — | 1 | ||||
South Africa | 0 | — | 1 | ||||
Other Emerging Markets | 0 | — | 3 | ||||
Subtotal | 8 | % | — | 11 | % | ||
NORTH AMERICA | |||||||
Canada | 0 | % | — | 6 | % | ||
Short-Term Reserves | 6 | % | — | — | |||
Total | 100 | % | 100 | % | 100 | % | |
Country percentages exclude futures and currency contracts held by the fund. |
* | MSCI EAFE Index. | |
** | MSCI All Country World Index ex USA. | |
Note: Short-term reserves exclude futures and currency contracts held by the fund. | Visit our website at Vanguard.com for regularly updated fund information. |
9
GLOSSARY OF INVESTMENT TERMS
Beta. A measure of the magnitude of a fund’s past share-price fluctuations in relation to the ups and downs of a given market index. The index is assigned a beta of 1.00. Compared with a given index, a fund with a beta of 1.20 typically would have seen its share price rise or fall by 12% when the index rose or fell by 10%. A fund’s beta should be reviewed in conjunction with its R-squared (see definition below). The lower the R-squared, the less correlation there is between the fund and the index, and the less reliable beta is as an indicator of volatility.
Expense Ratio. The percentage of a fund’s average net assets used to pay its annual administrative and advisory expenses. These expenses directly reduce returns to investors.
R-Squared. A measure of how much of a fund’s past returns can be explained by the returns from the market in general, as measured by a given index. If a fund’s total returns were precisely synchronized with an index’s returns, its R-squared would be 1.00. If the fund’s returns bore no relationship to the index’s returns, its R-squared would be 0.
Short-Term Reserves. The percentage of a fund invested in highly liquid, short-term securities that can be readily converted to cash.
Turnover Rate. An indication of the fund’s trading activity. Funds with high turnover rates incur higher transaction costs and may be more likely to distribute capital gains (which may be taxable to investors).
10
As of 2/28/2005 | PERFORMANCE SUMMARY All of the returns in this report represent past performance, which is not a guarantee of future results that may be achieved by the fund. (For performance data current to the most recent month-end, which may be higher or lower than that cited, visit our website at www.vanguard.com.) Note, too, that both investment returns and principal value can fluctuate widely, so an investor's shares, when sold, could be worth more or less than their original cost. The returns shown do not reflect taxes that a shareholder would pay on fund distributions or on the sale of fund shares. |
INTERNATIONAL GROWTH FUND
Fiscal-Year Total Returns (%) August 31, 1994–February 28, 2005
![Fiscal-Year Total Returns (%) Fiscal-Year Total Returns (%)](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/intlgrowth_bar.gif)
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on pages 21–22 for dividend and capital gains information.
Average Annual Total Returns for periods ended December 31, 2004
This table presents average annual total returns through the latest calendar quarter—rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information.
One | Five | Ten Years | ||||
---|---|---|---|---|---|---|
Inception Date | Year | Years | Capital | Income | Total | |
International Growth Fund* | ||||||
Investor Shares | 9/30/1981 | 18.95% | –0.52% | 5.62% | 1.42% | 7.04% |
Admiral Shares | 8/13/2001 | 19.16 | 7.74** | — | — | — |
* | Total returns do not reflect the 2% fee assessed on redemptions of shares purchased on or after June 27, 2003, and held for less than two months. |
** | Return since inception. |
11
ABOUT YOUR FUND’S EXPENSES
We believe it is important for you to understand the impact of costs on your investment. All mutual funds have operating expenses. As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of the fund. A fund’s expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period. The table below illustrates your fund’s costs in two ways:
• | 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. |
To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading “Expenses Paid During 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 February 28, 2005 | |||
---|---|---|---|
International Growth Fund | Beginning Account Value Aug. 31, 2004 | Ending Account Value Feb. 28, 2005 | Expenses Paid During Period* |
Based on Actual Fund Return | |||
Investor Shares | $1,000.00 | $1,198.02 | $3.32 |
Admiral Shares | 1,000.00 | 1,199.19 | 2.29 |
Based on Hypothetical | |||
5% Yearly Return | |||
Investor Shares | $1,000.00 | $1,021.77 | $3.06 |
Admiral Shares | 1,000.00 | 1,022.71 | 2.11 |
* | The calculations are based on expenses incurred in the most recent six-month period. The fund's annualized six-month expense ratios for that period are 0.61% for Investor Shares and 0.42% for Admiral Shares. The dollar amounts shown as "Expenses Paid" are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by the number of days in the most recent 12-month period. |
12
Note that the expenses shown in the table on page 12 are meant to highlight and help you compare ongoing costs only; they do not include your fund’s low-balance fee or the 2% fee that applies to shares purchased on or after July 27, 2003, and held for less than two months. These fees are fully described in the prospectus. If the fees were applied to your account, your costs would be higher. Your fund does not carry a “sales load.”
Annualized Expense Ratios: | |||
---|---|---|---|
Your fund compared with its peer group | |||
Investor Shares | Admiral Shares | Average International Fund | |
International Growth Fund | 0.61% | 0.42% | 1.73%* |
* | Peer-group expense ratio is derived from data provided by Lipper Inc. and captures information through year-end 2004. |
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. You can find more information about the fund's expenses, including annual expense ratios, in the Financial Statements section of this report. For additional information on operating expenses and other shareholder costs, please refer to the appropriate fund prospectus.
13
As of 2/28/2005 | FINANCIAL STATEMENTS (UNAUDITED) |
STATEMENT OF NET ASSETS
This Statement provides a detailed list of the fund’s holdings, including each security’s market value on the last day of the reporting period. Securities are grouped and subtotaled by asset type (common stocks, bonds, etc.) and by country. Other assets are added to, and liabilities are subtracted from, the value of Total Investments to calculate the fund’s Net Assets. Finally, Net Assets are divided by the outstanding shares of the fund to arrive at its share price, or Net Asset Value (NAV) Per Share.
At the end of the Statement of Net Assets, you will find a table displaying the composition of the fund’s net assets. Because all income and any realized gains must be distributed to shareholders each year, the bulk of net assets consists of Paid-in Capital (money invested by shareholders). The amounts shown for Undistributed Net Investment Income and Accumulated Net Realized Gains usually approximate the sums the fund had available to distribute to shareholders as income dividends or capital gains as of the statement date, but may differ because certain investments or transactions may be treated differently for financial statement and tax purposes. Any Accumulated Net Realized Losses, and any cumulative excess of distributions over net income or net realized gains, will appear as negative balances. Unrealized Appreciation (Depreciation) is the difference between the market value of the fund’s investments and their cost, and reflects the gains (losses) that would be realized if the fund were to sell all of its investments at their statement-date values.
The fund provides a complete list of its holdings four times in each fiscal year, at the quarter-ends. For the second and fourth fiscal quarters, the lists appear in the fund’s semiannual and annual reports to shareholders. For the first and third fiscal quarters, the fund files the lists with the Securities and Exchange Commission on Form N-Q. Shareholders can look up the fund’s Forms N-Q on the SEC’s website at www.sec.gov. Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room (see the back cover of this report for further information).
International Growth Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
COMMON STOCKS (93.6%)(1) | ||||
Australia (3.2%) | ||||
Woolworths Ltd. | 6,045,000 | $ 74,600 | ||
BHP Billiton Ltd. | 4,504,600 | 69,032 | ||
Foster's Group Ltd. | 10,211,000 | 42,177 | ||
Westpac Banking Corp., Ltd. | 2,332,000 | 35,241 | ||
National Australia Bank Ltd. | 1,461,000 | 33,276 | ||
Macquarie Infrastucture | ||||
Group | 10,607,718 | 30,566 | ||
News Corporation Inc. | 1,050,000 | 17,679 | ||
Lend Lease Corp. | 1,789,949 | 17,573 | ||
320,144 | ||||
Austria (0.2%) | ||||
Telekom Austria AG | 812,000 | 16,166 | ||
Belgium (0.3%) | ||||
KBC Bankverzekeringsholding | 400,500 | 33,687 | ||
Brazil (1.5%) | ||||
Petrol Brasil Series A ADR | 1,894,200 | 80,504 | ||
Companhia Vale | ||||
do Rio Doce ADR | 1,105,200 | $ 31,819 | ||
Unibanco-Uniao de Bancos | ||||
Brasileiros SA | 2,553,822 | 19,464 | ||
Tele Norte Leste | ||||
Participacoes ADR | 938,000 | 15,468 | ||
147,255 | ||||
China (0.4%) | ||||
CNOOC Ltd. | 36,135,000 | 20,782 | ||
China Oilfield Services Ltd. | 27,764,000 | 9,888 | ||
China Petroleum & | ||||
Chemical Corp. | 18,501,000 | 8,412 | ||
39,082 | ||||
Denmark (0.4%) | ||||
Danske Bank A/S | 1,453,730 | 44,729 | ||
Finland (0.6%) | ||||
Nokia Oyj | 3,795,075 | 61,424 | ||
14
Shares | Market Value^ (000) | |
---|---|---|
France (10.1%) | ||
Suez SA | 5,242,000 | $ 142,065 |
Societe Generale Class A | 833,000 | 88,065 |
L'Air Liquide SA (Registered) | 486,200 | 87,459 |
Groupe Danone | 846,000 | 84,369 |
*France Telecom SA | 2,731,000 | 82,558 |
Veolia Environnement | 2,195,000 | 76,401 |
L'Oreal SA | 969,453 | 75,951 |
*Vivendi Universal SA | 2,286,000 | 72,284 |
Thales SA | 1,178,000 | 53,395 |
BNP Paribas SA | 649,400 | 47,197 |
Essilor International SA | 647,900 | 45,521 |
Sanofi-Aventis | 501,500 | 40,082 |
Imerys SA | 471,000 | 38,420 |
Publicis Groupe SA | 879,734 | 26,861 |
Pernod Ricard SA | 180,850 | 25,915 |
LVMH Louis Vuitton | ||
Moet Hennessy | 273,000 | 20,234 |
1,006,777 | ||
Germany (4.3%) | ||
Siemens AG | 2,118,000 | 166,926 |
SAP AG | 369,000 | 60,309 |
Porsche AG | 61,600 | 44,680 |
Muenchener | ||
Rueckversicherungs- | ||
Gesellschaft AG (Registered) | 352,177 | 43,751 |
Bayer AG | 904,713 | 31,859 |
Adidas-Salomon AG | 205,710 | 31,056 |
RWE AG | 450,000 | 27,449 |
Bayerische Motoren | ||
Werke AG | 448,800 | 19,316 |
425,346 | ||
Hong Kong (1.3%) | ||
Swire Pacific Ltd. A Shares | 7,939,000 | 64,861 |
Cheung Kong Holdings Ltd. | 1,810,000 | 17,152 |
Li & Fung Ltd. | 8,620,000 | 14,681 |
Hong Kong Exchanges | ||
& Clearing Ltd. | 4,790,000 | 12,179 |
Jardine Matheson | ||
Holdings Ltd. | 659,200 | 11,759 |
Sun Hung Kai Properties Ltd. | 1,154,000 | 10,719 |
131,351 | ||
India (1.2%) | ||
(3)State Bank of India | ||
Warrants Exp. 12/23/2005 | 2,711,000 | 44,824 |
(3)Zee Telefilm | ||
Warrants Exp. 5/19/2006 | 8,508,240 | 27,933 |
(3)Oriental Bank of Commerce | ||
Warrants Exp. 8/8/2006 | 2,245,000 | 16,273 |
(3)ICICI Bank Ltd. | ||
Warrants Exp. 4/13/2005 | 1,190,350 | 10,451 |
(3)State Bank of India | ||
Warrants Exp. 1/19/2009 | 654,729 | $ 10,184 |
(3)ICICI Bank Ltd. | ||
Warrants Exp. 1/27/2009 | 752,814 | 6,634 |
116,299 | ||
Indonesia (0.6%) | ||
PT Telekomunikasi | ||
Indonesia Tbk | 46,360,000 | 22,172 |
PT Hanjaya Mandala | ||
Sampoerna Tbk | 16,359,000 | 14,369 |
PT Gudang Garam Tbk | 8,262,846 | 13,712 |
PT Indonesian Satellite | ||
Corporation Tbk | 16,936,000 | 9,578 |
59,831 | ||
Ireland (2.6%) | ||
Allied Irish Banks PLC | ||
(U.K. Shares) | 7,183,843 | 154,580 |
Bank of Ireland | 4,598,000 | 77,025 |
*Allied Irish Banks PLC | 1,311,160 | 28,254 |
259,859 | ||
Israel (0.3%) | ||
Teva Pharmaceutical | ||
Industries Ltd. | ||
Sponsored ADR | 880,200 | 26,503 |
Italy (1.9%) | ||
ENI SpA | 3,473,000 | 90,949 |
Snam Rete Gas SpA | 8,007,073 | 46,889 |
Riunione Adriatica | ||
di Sicurta SpA | 1,863,900 | 43,246 |
Unicredito Italiano SpA | 1,972,200 | 11,520 |
192,604 | ||
Japan (20.6%) | ||
East Japan Railway Co. | 30,000 | 160,161 |
Mitsui & Co., Ltd. | 14,615,000 | 149,447 |
Toyota Motor Corp. | 2,912,600 | 113,337 |
Ricoh Co. | 6,033,000 | 112,647 |
Mitsubishi Corp. | 7,335,000 | 99,850 |
KDDI Corp. | 17,734 | 91,480 |
Takeda Chemical Industries Ltd. | 1,731,000 | 83,249 |
Canon, Inc. | 1,438,000 | 76,237 |
Sumitomo Electric | ||
Industries Ltd. | 6,482,000 | 71,641 |
*T & D Holdings, Inc. | 1,318,000 | 70,514 |
Yamanouchi | ||
Pharmaceuticals Co., Ltd. | 1,798,000 | 64,008 |
Ito-Yokado Co., Ltd. | 1,432,000 | 59,170 |
*Electric Power | ||
Development Co., Ltd. | 1,578,000 | 50,540 |
Nomura Holdings Inc. | 3,350,000 | 46,457 |
Japan Tobacco, Inc. | 3,864 | 42,133 |
15
International Growth Fund | Shares | Market Value^ (000) |
---|---|---|
Bridgestone Corp. | 2,035,000 | $ 38,934 |
Asahi Glass Co., Ltd. | 3,439,000 | 37,931 |
Nissan Motor Co., Ltd. | 3,379,400 | 36,394 |
Mitsubishi Estate Co., Ltd. | 2,901,000 | 35,347 |
Denso Corp. | 1,367,000 | 35,128 |
Rohm Co., Ltd. | 335,400 | 33,665 |
Daito Trust | ||
Construction Co., Ltd. | 819,000 | 33,659 |
SMC Corp. | 268,400 | 32,691 |
Konica Minolta Holdings, Inc. | 2,474,000 | 29,501 |
Sumitomo Realty & | ||
Development Co. | 2,283,000 | 29,156 |
Mitsui Chemicals, Inc. | 4,961,000 | 28,918 |
Keyence Corp. | 116,500 | 28,234 |
Mitsui Sumitomo Insurance Co. | 3,127,000 | 27,942 |
Mitsubishi Electric Corp. | 5,199,000 | 27,302 |
Nippon Television | ||
Network Corp. | 170,640 | 27,293 |
*UFJ Holdings Inc. | 4,860 | 26,901 |
(3)Nippon Television Network | ||
Warrants Exp. 1/19/2007 | 160,000 | 25,637 |
Takashimaya Co. | 2,481,000 | 24,807 |
Honda Motor Co., Ltd. | 433,000 | 23,295 |
*Sumitomo Heavy | ||
Industries Ltd. | 5,223,000 | 23,002 |
Mitsui Osk Lines Ltd. | 3,014,000 | 20,700 |
Nippon Paper Group, Inc. | 4,180 | 20,491 |
Tokyu Corp. | 3,694,000 | 19,872 |
West Japan Railway Co. | 4,630 | 18,267 |
Yamada Denki Co., Ltd. | 348,300 | 17,343 |
Koyo Seiko Co., Ltd. | 1,225,000 | 17,319 |
Omron Corp. | 721,000 | 16,730 |
Marui Co., Ltd. | 934,000 | 12,276 |
Shinsei Bank, Ltd. | 1,753,000 | 10,292 |
THK Co., Inc. | 378,000 | 8,189 |
Toho Co., Ltd. | 9,900 | 160 |
2,058,247 | ||
Mexico (0.6%) | ||
America Movil SA de | ||
CV Series L ADR | 982,536 | 57,675 |
Netherlands (2.6%) | ||
TPG NV | 4,144,000 | 115,770 |
Royal Dutch Petroleum Co. | 1,747,000 | 110,404 |
*Verenigde Nederlandse | ||
Uitgeversbedrijven NV | 582,590 | 18,265 |
Oce NV | 694,166 | 11,503 |
255,942 | ||
Russia (0.2%) | ||
Mobile Telesystems | ||
Sponsored ADR | 434,800 | 17,431 |
Singapore (0.4%) | ||
Singapore Press Holdings Ltd. | 6,170,000 | $ 17,262 |
Noble Group Ltd. | 13,320,000 | 14,528 |
Keppel Corp., Ltd. | 1,080,000 | 6,267 |
Venture Corp. Ltd. | 492,000 | 4,354 |
42,411 | ||
South Africa (0.3%) | ||
Sasol Ltd. | 1,105,000 | 27,896 |
Anglo American Platinum Corp. | 136,600 | 5,431 |
33,327 | ||
South Korea (2.4%) | ||
Samsung Electronics Co., Ltd. | 152,000 | 78,895 |
Shinsegae Co., Ltd. | 132,372 | 42,502 |
*Hana Bank | 1,288,000 | 36,753 |
Hyundai Motor Co. Ltd. | 607,000 | 34,727 |
*Shinhan Financial Group Ltd. | 1,047,000 | 30,916 |
(3)Samsung Electrionics | ||
Co., Ltd. GDR | 69,300 | 17,949 |
241,742 | ||
Spain (2.8%) | ||
Telefonica SA | 6,270,000 | 115,542 |
Altadis SA | 1,058,000 | 44,532 |
Iberdrola SA | 1,645,000 | 43,442 |
Banco Popular Espanol SA | 463,680 | 32,152 |
Banco Santander | ||
Central Hispano SA | 2,471,000 | 30,593 |
Industria de Diseno Textil SA | 464,250 | 14,368 |
280,629 | ||
Sweden (2.5%) | ||
Skandinaviska Enskilda | ||
Banken AB A Shares | 3,614,000 | 70,126 |
Svenska Handelsbanken | ||
AB A Shares | 2,167,420 | 53,023 |
Sandvik AB | 1,065,000 | 46,445 |
Atlas Copco AB A Shares | 849,130 | 42,380 |
*Telefonaktiebolaget LM | ||
Ericsson AB Class B | 6,512,886 | 19,180 |
SKF AB B Shares | 318,170 | 15,819 |
246,973 | ||
Switzerland (4.9%) | ||
Nestle SA (Registered) | 517,000 | 143,964 |
Cie. Financiere Richemont AG | 2,499,571 | 79,319 |
Novartis AG (Registered) | 1,496,000 | 75,065 |
UBS AG (Registered) | 674,860 | 58,751 |
Adecco SA (Registered) | 841,444 | 46,079 |
*ABB Ltd. | 5,882,780 | 35,906 |
Holcim Ltd. (Registered) | 450,280 | 29,959 |
*Zurich Financial Services AG | 117,906 | 21,769 |
490,812 | ||
16
Shares | Market Value^ (000) | |
---|---|---|
Taiwan (1.0%) | ||
Quanta Computer Inc. | 19,626,159 | $ 35,153 |
Fubon Financial | ||
Holding Co., Ltd. GDR | 3,313,000 | 34,346 |
Hon Hai Precision | ||
Industry Co., Ltd. | 6,735,996 | 31,369 |
100,868 | ||
Thailand (0.1%) | ||
*Kasikornbank Public Co. Ltd. | ||
(Foreign) | 6,297,500 | 10,778 |
United Kingdom (26.3%) | ||
*Tesco PLC | 51,689,043 | 303,664 |
Shell Transport & | ||
Trading Co. PLC | 24,520,000 | 230,818 |
Vodafone Group PLC | 84,514,000 | 221,333 |
*Royal Bank of Scotland | ||
Group PLC | 6,193,600 | 212,384 |
BG Group PLC | 22,218,551 | 174,272 |
Brambles Industries PLC | 21,362,854 | 125,460 |
*Kingfisher PLC | 20,439,527 | 114,635 |
Signet Group PLC | 48,521,000 | 104,652 |
*HBOS PLC | 5,970,533 | 95,099 |
Cadbury Schweppes PLC | 9,272,000 | 91,204 |
Centrica PLC | 19,712,700 | 89,749 |
*Prudential PLC | 7,772,333 | 70,925 |
Smith & Nephew PLC | 6,769,614 | 69,641 |
Reckitt Benckiser PLC | 1,880,000 | 59,312 |
Rio Tinto PLC | 1,433,000 | 50,630 |
GlaxoSmithKline PLC | 1,910,200 | 45,722 |
British Sky Broadcasting | ||
Group PLC | 4,020,000 | 43,799 |
AstraZeneca Group PLC | 1,078,000 | 42,735 |
Hilton Group PLC | 6,126,000 | 36,958 |
Kidde PLC | 11,379,000 | 36,346 |
Imperial Tobacco Group PLC | 1,360,000 | 36,359 |
Unilever PLC | 3,636,000 | 34,867 |
Provident Financial PLC | 2,638,000 | 34,329 |
Johnson Matthey PLC | 1,624,781 | 31,594 |
Bunzl PLC | 3,259,000 | 31,306 |
Premier Farnell PLC | 8,806,300 | 30,822 |
Carnival PLC | 520,030 | 29,931 |
Rexam PLC | 3,260,636 | 28,763 |
Wolseley PLC | 1,322,000 | 28,222 |
Barclays PLC | 2,301,900 | 25,097 |
Next PLC | 788,000 | 23,373 |
*Standard Chartered PLC | 851,000 | 15,643 |
Man Group PLC | 588,000 | 15,250 |
Cairn Energy PLC | 615,558 | 14,808 |
IMI PLC | 1,597,117 | 12,561 |
Capita Group PLC | 1,371,000 | 10,005 |
2,622,268 | ||
TOTAL COMMON STOCKS | ||
(Cost $7,039,119) | $ 9,340,160 | |
TEMPORARY CASH INVESTMENTS (14.3%)(1) | ||
Money Market Funds (14.1%) | ||
Vanguard Market Liquidity | ||
Fund, 2.540%** | 594,173,354 | 594,173 |
Vanguard Market Liquidity | ||
Fund, 2.540%**—Note G | 810,580,754 | 810,581 |
1,404,754 | ||
Face | ||
Amount | ||
(000) | ||
U.S. Agency Obligation (0.2%) | ||
Federal Home Loan Bank† | ||
(2) 2.555%, 4/20/2005 | $ 25,000 | 24,903 |
TOTAL TEMPORARY CASH INVESTMENTS | ||
(Cost $1,429,666) | 1,429,657 | |
TOTAL INVESTMENTS (107.9%) | ||
(Cost $8,468,785) | 10,769,817 | |
OTHER ASSETS AND LIABILITIES (-7.9%) | ||
Other Assets—Note C | 148,568 | |
Security Lending Collateral | ||
Payable to Brokers—Note G | (810,581) | |
Other Liabilities | (124,944) | |
(786,957) | ||
NET ASSETS (100%) | $ 9,982,860 | |
^ | See Note A in Notes to Financial Statements. |
* | Non-income-producing security. |
** | Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
† | The issuer operates under a congressional charter; its securities are neither issued nor guaranteed by the U.S. government. If needed, access to additional funding (beyond the issuer's line of credit) would require congressional action. |
(1) | The fund invests a portion of its cash reserves in equity markets through the use of index futures contracts. After giving effect to these investments, the fund's effective common stock and temporary cash investment positions represent 97.6% and 10.3%, respectively, of net assets. See Note E in Notes to Financial Statements. |
(2) | Security segregated as initial margin for open futures contracts. |
(3) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be sold in transactions exempt from registration, normally to qualified institutional buyers. At February 28, 2005, the aggregate value of these securities was $159,885,000, representing 1.6% of net assets. |
ADR—American Depositary Receipt. | |
GDR—Global Depositary Receipt. |
17
International Growth Fund | Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $8,060,240 |
Undistributed Net Investment Income | 2,871 |
Accumulated Net Realized Losses | (402,966) |
Unrealized Appreciation | |
Investment Securities | 2,301,032 |
Futures Contracts | 18,855 |
Foreign Currencies and | |
Forward Currency Contracts | 2,828 |
NET ASSETS | $9,982,860 |
Investor Shares—Net Assets | |
Applicable to 437,068,729 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $8,403,031 |
NET ASSET VALUE PER SHARE— | |
INVESTOR SHARES | $19.23 |
Admiral Shares—Net Assets | |
Applicable to 25,834,964 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $1,579,829 |
NET ASSET VALUE PER SHARE— | |
ADMIRAL SHARES | $61.15 |
See Note E in Notes to Financial Statements for the tax-basis components of net assets. |
18
STATEMENT OF OPERATIONS
This Statement shows the types of income earned by the fund during the reporting period, and details the operating expenses charged to each class of its shares. These expenses directly reduce the amount of investment income available to pay to shareholders as income dividends. This Statement also shows any Net Gain (Loss) realized on the sale of investments, and the increase or decrease in the Unrealized Appreciation (Depreciation) of investments during the period.
International Growth Fund | |
---|---|
Six Months Ended February 28, 2005 (000) | |
INVESTMENT INCOME | |
Income | |
Dividends* | $ 70,768 |
Interest | 5,327 |
Security Lending | 1,319 |
Total Income | 77,414 |
Expenses | |
Investment Advisory Fees—Note B | |
Basic Fee | 5,978 |
Performance Adjustment | (757) |
The Vanguard Group—Note C | |
Management and Administrative | |
Investor Shares | 16,218 |
Admiral Shares | 1,673 |
Marketing and Distribution | |
Investor Shares | 536 |
Admiral Shares | 124 |
Custodian Fees | 1,946 |
Shareholders' Reports | |
Investor Shares | 131 |
Admiral Shares | — |
Trustees' Fees and Expenses | 9 |
Total Expenses | 25,858 |
Expenses Paid Indirectly—Note D | (509) |
Net Expenses | 25,349 |
NET INVESTMENT INCOME | 52,065 |
REALIZED NET GAIN (LOSS) | |
Investment Securities Sold | 412,717 |
Futures Contracts | 10,858 |
Foreign Currencies and Forward Currency Contracts | 29,615 |
REALIZED NET GAIN (LOSS) | 453,190 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | |
Investment Securities | 1,082,846 |
Futures Contracts | 26,155 |
Foreign Currencies and Forward Currency Contracts | 2,465 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) | 1,111,466 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ 1,616,721 |
*Dividends are net of foreign withholding taxes of $3,369,000 |
19
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how the fund’s total net assets changed during the two most recent reporting periods. The Operations section summarizes information detailed in the Statement of Operations. The amounts shown as Distributions to shareholders from the fund’s net income and capital gains may not match the amounts shown in the Operations section, because distributions are determined on a tax basis and may be made in a period different from the one in which the income was earned or the gains were realized on the financial statements. The Capital Share Transactions section shows the net amount shareholders invested in or redeemed from the fund. Distributions and Capital Share Transactions are shown separately for each class of shares.
International Growth Fund | ||
---|---|---|
Six Months Ended Feb. 28, 2005 (000) | Year Ended Aug. 31, 2004 (000) | |
INCREASE (DECREASE) IN NET ASSETS | ||
Operations | ||
Net Investment Income | $ 52,065 | $ 132,669 |
Realized Net Gain (Loss) | 453,190 | 546,876 |
Change in Unrealized Appreciation (Depreciation) | 1,111,466 | 501,051 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 1,616,721 | 1,180,596 |
Distributions | ||
Net Investment Income | ||
Investor Shares | (132,989) | (82,650) |
Admiral Shares | (26,782) | (17,801) |
Realized Capital Gain | ||
Investor Shares | — | — |
Admiral Shares | — | — |
Total Distributions | (159,771) | (100,451) |
Capital Share Transactions—Note H | ||
Investor Shares | 376,901 | 431,895 |
Admiral Shares | 89,615 | 45,509 |
Net Increase (Decrease) from Capital Share Transactions | 466,516 | 477,404 |
Total Increase (Decrease) | 1,923,466 | 1,557,549 |
Net Assets | ||
Beginning of Period | 8,059,394 | 6,501,845 |
End of Period | $ 9,982,860 | $ 8,059,394 |
20
FINANCIAL HIGHLIGHTS
This table summarizes the fund’s investment results and distributions to shareholders on a per-share basis for each class of shares. It also presents the Total Return and shows net investment income and expenses as percentages of average net assets. These data will help you assess: the variability of the fund’s net income and total returns from year to year; the relative contributions of net income and capital gains to the fund’s total return; how much it costs to operate the fund; and the extent to which the fund tends to distribute capital gains. The table also shows the Portfolio Turnover Rate, a measure of trading activity. A turnover rate of 100% means that the average security is held in the fund for one year.
International Growth Fund Investor Shares | ||||||
---|---|---|---|---|---|---|
Six Months Ended | Year Ended August 31, | |||||
For a Share Outstanding Throughout Each Period | Feb. 28, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 |
Net Asset Value, Beginning of Period | $16.33 | $14.01 | $12.97 | $15.41 | $22.23 | $19.75 |
Investment Operations | ||||||
Net Investment Income | .098 | .27 | .19 | .19 | .23 | .26 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.117 | 2.26 | 1.03 | (2.35) | (5.41) | 3.38 |
Total from Investment Operations | 3.215 | 2.53 | 1.22 | (2.16) | (5.18) | 3.64 |
Distributions | ||||||
Dividends from Net Investment Income | (.315) | (.21) | (.18) | (.24) | (.22) | (.26) |
Distributions from Realized Capital Gains | — | — | — | (.04) | (1.42) | (.90) |
Total Distributions | (.315) | (.21) | (.18) | (.28) | (1.64) | (1.16) |
Net Asset Value, End of Period | $19.23 | $16.33 | $14.01 | $12.97 | $15.41 | $22.23 |
Total Return* | 19.80% | 18.14% | 9.62% | -14.20% | -24.49% | 18.68% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $8,403 | $6,797 | $5,458 | $4,930 | $6,447 | $10,144 |
Ratio of Total Expenses to Average Net Assets** | 0.61%† | 0.63% | 0.69% | 0.67% | 0.61% | 0.53% |
Ratio of Net Investment Income to Average Net Assets | 1.14%† | 1.69% | 1.57% | 1.28% | 1.19% | 1.26% |
Portfolio Turnover Rate | 46%† | 45% | 59% | 40% | 48% | 48% |
* | Total returns do not reflect the 2% fee assessed on redemptions of shares purchased on or after June 27, 2003, and held for less than two months. |
** | Includes performance-based investment advisory fee increases (decreases) of (0.02%), 0.00%, 0.01%, 0.02%, 0.01%, and 0.00%. |
† | Annualized. |
21
FINANCIAL HIGHLIGHTS (CONTINUED)
International Growth Fund Admiral Shares | |||||
---|---|---|---|---|---|
Six Months Ended Feb. 28, | Year Ended August 31, | Aug.13* to Aug. 31, | |||
For a Share Outstanding Throughout Each Period | 2005 | 2004 | 2003 | 2002 | 2001 |
Net Asset Value, Beginning of Period | $51.96 | $44.57 | $41.27 | $49.02 | $50.00 |
Investment Operations | |||||
Net Investment Income | .368 | .93 | .681 | .677 | .07 |
Net Realized and Unrealized Gain (Loss) on Investments | 9.917 | 7.21 | 3.264 | (7.502) | (1.05) |
Total from Investment Operations | 10.285 | 8.14 | 3.945 | (6.825) | (.98) |
Distributions | |||||
Dividends from Net Investment Income | (1.095) | (.75) | (.645) | (.795) | — |
Distributions from Realized Capital Gains | — | — | — | (.130) | — |
Total Distributions | (1.095) | (.75) | (.645) | (.925) | — |
Net Asset Value, End of Period | $61.15 | $51.96 | $44.57 | $41.27 | $49.02 |
Total Return** | 19.92% | 18.36% | 9.80% | -14.12% | -1.96% |
Ratios/Supplemental Data | |||||
Net Assets, End of Period (Millions) | $1,580 | $1,262 | $1,044 | $895 | $495 |
Ratio of Total Expenses to Average Net Assets† | 0.42%†† | 0.45% | 0.51% | 0.54% | 0.54%†† |
Ratio of Net Investment Income to Average Net Assets | 1.33%†† | 1.86% | 1.76% | 1.53% | 2.50%†† |
Portfolio Turnover Rate | 46%†† | 45% | 59% | 40% | 48% |
* | Inception. |
** | Total returns do not reflect the 2% fee assessed on redemptions of shares purchased on or after June 27, 2003, and held for less than two months. |
† | Includes performance-based investment advisory fee increases (decreases) of (0.02%), 0.00%, 0.01%, 0.02%, and 0.01%. |
†† | Annualized. |
SEE ACCOMPANYING NOTES, WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
22
NOTES TO FINANCIAL STATEMENTS
Vanguard International Growth Fund is registered under the Investment Company Act of 1940 as an open-end investment company, or mutual fund. The fund invests in securities of foreign issuers, which may subject it to investment risks not normally associated with investing in securities of United States corporations. The fund offers two classes of shares, Investor Shares and Admiral Shares. Investor Shares are available to any investor who meets the fund’s minimum purchase requirements. Admiral Shares are designed for investors who meet certain administrative, servicing, tenure, and account-size criteria.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S. mutual funds. The fund consistently follows such policies in preparing its financial statements.
1. | Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been affected by events occurring before the fund’s pricing time but after the close of the securities’ primary markets, are valued at their fair values calculated according to procedures adopted by the board of trustees. These procedures include monitoring news to identify significant market- or security-specific events, and evaluating changes in the values of foreign market proxies (for example, ADRs, futures contracts or exchange-traded funds), between the time the foreign markets close and the fund’s pricing time. When fair-value pricing is employed, the prices of securities used by a fund to calculate its net asset value may differ from quoted or published prices for the same securities. Investments in Vanguard Market Liquidity Fund are valued at that fund’s net asset value. Temporary cash investments acquired over 60 days to maturity are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Other temporary cash investments are valued at amortized cost, which approximates market value. |
2. | Foreign Currency: Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rates on the valuation date as employed by Morgan Stanley Capital International (MSCI) in the calculation of its indexes. As part of the fund’s fair value procedures, exchange rates may be adjusted if they change significantly before the fund’s pricing time but after the time at which the MSCI rates are determined (generally 11:00 a.m. Eastern time). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities include the effects of changes in exchange rates since the securities were purchased, combined with the effects of changes in security prices. Fluctuations in the value of other assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses) until the asset or liability is settled in cash, when they are recorded as realized foreign currency gains (losses). |
3. | Futures and Forward Currency Contracts: The fund uses S&P ASX 200 Index, Dow Jones EURO STOXX 50 Index, FTSE 100 Index, and Topix Index futures contracts to a limited extent, with the objective of maintaining exposure to the European and Pacific stock markets while maintaining liquidity. The fund may purchase or sell futures contracts to achieve a desired level of investment, whether to accommodate portfolio turnover or cash flows from capital share transactions. The primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks held by the portfolio and the prices of futures contracts, and the possibility of an illiquid market. |
23
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The fund also enters into forward currency contracts to provide the appropriate currency exposure related to any open futures contracts. The fund’s risks in using these contracts include movement in the values of the foreign currencies relative to the U.S. dollar and the ability of the counterparties to fulfill their obligations under the contracts. |
Futures and forward currency contracts are valued at their quoted daily settlement prices. The aggregate principal amounts of the contracts are not recorded in the financial statements. Fluctuations in the value of the contracts are recorded in the Statement of Net Assets as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized gains (losses) on futures or forward currency contracts. |
4. | Federal Income Taxes: The fund intends to continue to qualify as a regulated investment company and distribute all of its taxable income. Accordingly, no provision for federal income taxes is required in the financial statements. |
5. | Distributions: Distributions to shareholders are recorded on the ex-dividend date. |
6. | Security Lending: The fund may lend its securities to qualified institutional borrowers to earn additional income. Security loans are required to be secured at all times by collateral at least equal to the market value of securities loaned. The fund invests cash collateral received in Vanguard Market Liquidity Fund, and records a liability for the return of the collateral, during the period the securities are on loan. Security lending income represents the income earned on investing cash collateral, less expenses associated with the loan. |
7. | Other: Dividend income is recorded on the ex-dividend date. Interest income includes income distributions received from Vanguard Market Liquidity Fund and is accrued daily. Security transactions are accounted for on the date securities are bought or sold. Costs used to determine realized gains (losses) on the sale of investment securities are those of the specific securities sold. Fees assessed on redemptions of capital shares are credited to paid-in capital. |
Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees. Income, other non-class-specific expenses, and gains and losses on investments are allocated to each class of shares based on its relative net assets. |
B. Schroder Investment Management North America Inc. and Baillie Gifford Overseas Ltd. 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 fee of each advisor is subject to quarterly adjustments based on performance relative to the Morgan Stanley Capital International Europe, Australasia, Far East Index. For Schroder, the adjustments are based on performance for the preceding three years, and for Baillie Gifford the adjustments are based on performance since December 1, 2003.
The Vanguard Group manages the cash reserves of the fund on an at-cost basis.
For the six months ended February 28, 2005, the aggregate investment advisory fee represented an effective annual basic rate of 0.13% of the fund’s average net assets, before a decrease of $757,000 (0.02%) based on performance.
C. The Vanguard Group furnishes at cost corporate management, administrative, marketing, and distribution services. The costs of such services are allocated to the fund under methods approved by the board of trustees. The fund has committed to provide up to 0.40% of its net assets in capital contributions to Vanguard. At February 28, 2005, the fund had contributed capital of $1,251,000
24
to Vanguard (included in Other Assets), representing 0.01% of the fund’s net assets and 1.25% of Vanguard’s capitalization. The fund’s trustees and officers are also directors and officers of Vanguard.
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 six months ended February 28, 2005, these arrangements reduced the fund’s expenses by $509,000 (an annual rate of 0.01% of average net assets).
E. Distributions are determined on a tax basis and may differ from net investment income and realized capital gains for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain, or loss are recognized in different periods for financial statement and tax purposes; these differences will reverse at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.
During the six months ended February 28, 2005, the fund realized net foreign currency losses of $522,000, which decreased distributable net income for tax purposes; accordingly, such losses have been reclassified from accumulated net realized losses to undistributed net investment income. Certain of the fund’s investments are in securities considered to be “passive foreign investment companies,” for which any unrealized appreciation and/or realized gains are required to be included in distributable net income for tax purposes. The fund realized gains on sales of “passive foreign investment companies” of $4,119,000, which have been included in current and prior periods’ taxable income and distributions to shareholders; accordingly, such gains have been reclassified from accumulated net realized gains to undistributed net investment income.
The fund’s tax-basis capital gains and losses are determined only at the end of each fiscal year. For tax purposes, at August 31, 2004, the fund had available realized losses of $852,521,000 to offset future net capital gains of $142,747,000 through August 31, 2010, and $709,774,000 through August 31, 2011. The fund will use these capital losses to offset net taxable capital gains, if any, realized during the year ending August 31, 2005; should the fund realize net capital losses for the year, the losses will be added to the loss carryforward balances above.
At February 28, 2005, net unrealized appreciation of investment securities for tax purposes was $2,301,032,000, consisting of unrealized gains of $2,354,256,000 on securities that had risen in value since their purchase and $53,224,000 in unrealized losses on securities that had fallen in value since their purchase.
At February 28, 2005, the aggregate settlement value of open futures contracts expiring in March 2005 and the related unrealized appreciation (depreciation) were:
(000) | |||
---|---|---|---|
Futures Contracts | Number of Long Contracts | Aggregate Settlement Value | Unrealized Appreciation (Depreciation) |
Dow Jones EURO STOXX 50 Index | 3,657 | $147,532 | $5,249 |
FTSE 100 Index | 1,294 | 123,099 | 5,288 |
Topix Index | 819 | 92,324 | 6,795 |
S&P ASX 200 Index | 417 | 34,344 | 1,523 |
25
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
At February 28, 2005, the fund had open forward currency contracts to receive and deliver currencies as follows:
(000) | |||||
---|---|---|---|---|---|
Contract Amount | Unrealized Appreciation | ||||
Contract Settlement Date | Receive | Deliver | (Depreciation) | ||
3/23/2005 | EUR | 112,197 | USD | 148,973 | $(1,318) |
3/23/2005 | GBP | 65,059 | USD | 125,132 | (329) |
3/16/2005 | JPY | 9,541,350 | USD | 91,587 | 110 |
3/23/2005 | AUD | 42,934 | USD | 34,028 | 1,839 |
AUD-Australian dollar | |||||
EUR-Euro | |||||
GBP-British pound | |||||
JPY-Japanese Yen | |||||
USD-U.S. dollar |
Unrealized appreciation (depreciation) on open forward currency contracts is treated as realized gain (loss) for tax purposes.
The fund had net unrealized foreign currency gains of $2,526,000 resulting from the translation of other assets and liabilities at February 28, 2005.
F. During the six months ended February 28, 2005, the fund purchased $2,242,337,000 of investment securities and sold $1,929,701,000 of investment securities other than temporary cash investments.
G. The market value of securities on loan to broker/dealers at February 28, 2005, was $783,941,000, for which the fund received cash collateral of $810,581,000.
H. Capital share transactions for each class of shares were:
Six Months Ended February 28, 2005 | Year Ended August 31, 2004 | ||||
---|---|---|---|---|---|
Amount (000) | Shares (000) | Amount (000) | Shares (000) | ||
Investor Shares | |||||
Issued | $723,882 | 40,029 | $1,286,444 | 79,993 | |
Issued in Lieu of Cash Distributions | 127,163 | 7,006 | 78,734 | 5,083 | |
Redeemed* | (474,144) | (26,316) | (933,283) | (58,462) | |
Net Increase (Decrease)—Investor Shares | 376,901 | 20,719 | 431,895 | 26,614 | |
Admiral Shares | |||||
Issued | 216,266 | 3,758 | 383,409 | 7,512 | |
Issued in Lieu of Cash Distributions | 23,476 | 407 | 15,842 | 322 | |
Redeemed* | (150,127) | (2,623) | (353,742) | (6,957) | |
Net Increase (Decrease)—Admiral Shares | 89,615 | 1,542 | 45,509 | 877 | |
*Net of redemption fees of $57,000 for 2005 and $197,000 for 2004 (fund totals) |
26
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27
THE PEOPLE WHO GOVERN YOUR FUND
The trustees of your mutual fund are there to see that the fund is operated and managed in your best interests since, as a shareholder, you are a part owner of the fund. Your fund trustees also serve on the board of directors of The Vanguard Group, Inc., which is owned by the Vanguard funds and provides services to them on an at-cost basis.
A majority of Vanguard's board members are independent, meaning that they have no affiliation with Vanguard or the funds they oversee, apart from the sizable personal investments they have made as private individuals.
Our independent board members bring distinguished backgrounds in business, academia, and public service to their task of working with Vanguard officers to establish the policies and oversee the activities of the funds. Among board members' responsibilities are
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
John J. Brennan* (1954) May 1987 | Chairman of the Board, Chief Executive Officer, and Trustee (132) | Chairman of the Board,Chief Executive Officer, and Director/Trustee of The Vanguard Group, Inc., and of each of the investment companies served by The Vanguard Group. |
INDEPENDENT TRUSTEES | ||
Charles D. Ellis (1937) January 2001 | Trustee (132) | The Partners of `63 (pro bono ventures in education); Senior Advisor to Greenwich Associates (international business strategy consulting); Successor Trustee of Yale University; Overseer of the Stern School of Business at New York University; Trustee of the Whitehead Institute for Biomedical Research. |
Rajiv L. Gupta (1945) December 2001** | Trustee (132) | Chairman and Chief Executive Officer (since October 1999), Vice Chairman (January-September 1999), and Vice President (prior to September 1999) of Rohm and Haas Co. (chemicals); Director of Technitrol, Inc. (electronic components), and Agere Systems (commu- nications components); Board Member of the American Chemistry Council; Trustee of Drexel University. |
JoAnn Heffernan Heisen (1950) July 1998 | Trustee (132) | Vice President, Chief Information Officer, and Member of the Executive Committee of Johnson & Johnson (pharmaceuticals/ consumer products); Director of the University Medical Center at Princeton and Women's Research and Education Institute. |
Burton G. Malkiel (1932) May 1977 | Trustee (129) | Chemical Bank Chairman's Professor of Economics, Princeton University; Director of Vanguard Investment Series plc (Irish invest- ment fund) (since November 2001), Vanguard Group (Ireland) Limited (investment management) (since November 2001), Prudential Insurance Co. of America, BKF Capital (investment management), The Jeffrey Co. (holding company), and NeuVis, Inc. (software company). |
André F. Perold (1952) December 2004 | Trustee (132) | George Gund Professor of Finance and Banking, Harvard Business School (since 2000); Senior Associate Dean, Director of Faculty Recruiting, and Chair of Finance Faculty, Harvard Business School; Director and Chairman of Unx, Inc. (equities trading firm) (since 2003); Director of registered investment companies advised by Merrill Lynch Investment Managers and affiliates (1985–2004), Genbel Securities Limited (South African financial services firm) (1999–2003), Gensec Bank (1999–2003), Sanlam Investment Management (1999–2001), Sanlam, Ltd. (South African insurance company) (2001–2003), Stockback, Inc. (credit card firm) (2000–2002), and Bulldogresearch.com (investment research) (1999–2001); and Trustee of Commonfund (investment management) (1989–2001). |
selecting investment advisors for the funds; monitoring fund operations, performance, and costs; reviewing contracts; nominating and selecting new trustees/directors; and electing Vanguard officers.
Each trustee serves a fund until its termination; or until the trustee’s retirement, resignation, or death; or otherwise as specified in the fund’s organizational documents. Any trustee may be removed at a shareholders’ meeting by a vote representing two-thirds of the net asset value of all shares of the fund together with shares of other Vanguard funds organized within the same trust. The table on these two pages shows information for each trustee and executive officer of the fund. The mailing address of the trustees and officers is P.O. Box 876, Valley Forge, PA 19482.
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
Alfred M. Rankin, Jr. (1941) January 1993 | Trustee (132) | Chairman, President, Chief Executive Officer, and Director of NACCO Industries, Inc. (forklift trucks/housewares/lignite); Director of Goodrich Corporation (industrial products/aircraft systems and services); Director of Standard Products Company (supplier for the automotive industry) until 1998. |
J. Lawrence Wilson (1936) April 1985 | Trustee (132) | Retired Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Director of Cummins Inc. (diesel engines), MeadWestvaco Corp. (paper products), and AmerisourceBergen Corp. (pharmaceutical distribution); Trustee of Vanderbilt University. |
EXECUTIVE OFFICERS* | ||
R. Gregory Barton (1951) June 2001 | Secretary (132) | Managing Director and General Counsel of The Vanguard Group, Inc.; Secretary of The Vanguard Group and of each of the investment companies served by The Vanguard Group. |
Thomas J. Higgins (1957) July 1998 | Treasurer (132) | Principal of The Vanguard Group, Inc.; Treasurer of each of the investment companies served by The Vanguard Group. |
*Officers of the funds are “interested persons” as defined in the Investment Company Act of 1940. | ||
**December 2002 for Vanguard® Equity Income Fund, Vanguard® Growth Equity Fund, the Vanguard® Municipal Bond Funds, and the Vanguard® State Tax-Exempt Funds. |
More information about the trustees is in the Statement of Additional Information, available from The Vanguard Group.
VANGUARD SENIOR MANAGEMENT TEAM | |
Mortimer J. Buckley, Information Technology. James H. Gately, Investment Programs and Services. Kathleen C. Gubanich, Human Resources. F. William McNabb, III, Client Relationship Group. | Michael S. Miller, Planning and Development. Ralph K. Packard, Finance. George U. Sauter, Chief Investment Officer. |
John C. Bogle, Founder; Chairman and Chief Executive Officer, 1974-1996. | |
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Vanguard® Calvert Social Index Fund
February 28, 2005
CONTENTS
1 CHAIRMAN'S LETTER
5 FUND PROFILE
6 GLOSSARY OF INVESTMENT TERMS
7 PERFORMANCE SUMMARY
8 ABOUT YOUR FUND'S EXPENSES
10 FINANCIAL STATEMENTS
25 ADVANTAGES OF VANGUARD.COM
SUMMARY
• During the six months ended February 28, 2005, the Investor Shares of Vanguard Calvert Social Index Fund returned 6.6%.
• The fund’s performance was in line with the 6.8% advance of its target index. The average large-cap growth fund returned 8.8%.
• Solid gains from sizable holdings in the technology and consumer discretionary sectors fueled the fund’s return. The fund’s holdings in health care, another heavily weighted sector, produced less impressive results.
VANGUARD’S PLEDGE TO CLIENTS
We recognize that your relationship with Vanguard rests on the twin pillars of trust and excellence, each of which is built upon the character of our people. Our Pledge to Clients reflects our ongoing efforts to deserve your trust and to continually improve so that we can offer you excellence in all that we do.
We will:
• Put your interests first at all times.
• Continually seek to earn your trust by adhering to the highest standards of ethical behavior and fiduciary responsibility.
• Strive to be the highest-value provider of investment services, which means outstanding investment performance and service, both at the lowest possible cost.
• Communicate candidly not only about the rewards of investing but also about the risks and costs.
• Maintain highly effective controls to safeguard your assets and protect your confidential information.
• Invest a majority of our personal assets alongside yours.
Please note: The opinions expressed in this report are just that—informed opinions. They should not be considered promises or advice. Also, please keep in mind that the information and opinions cover the period through the date on the cover of this report. Of course, the risks of investing in your fund are spelled out in the prospectus.
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CHAIRMAN'S LETTER
Dear Shareholder,
For the first six months of the 2005 fiscal year, the Investor Shares of Vanguard Calvert Social Index Fund returned 6.6%. The fund closely tracked the performance of its target benchmark, the Calvert Social Index, which lagged the average return for large-capitalization growth funds in the period.
The table below presents the six-month total return (capital change plus reinvested dividends) for your fund’s Investor Shares, along with those of the Calvert Social Index, the average large-cap growth fund, and the Dow Jones Wilshire 5000 Composite Index, a proxy for the broad U.S. stock market. The table also includes the return for the fund’s Institutional Shares, which require a minimum investment of $10 million. The table on page 4 provides details of the changes in the fund’s net asset values, along with its distributions to shareholders.
Total Returns | Six Months Ended February 28, 2005 |
---|---|
Vanguard Calvert Social Index Fund | |
Investor Shares | 6.6% |
Institutional Shares | 6.7 |
Calvert Social Index | 6.8 |
Average Large-Cap Growth Fund* | 8.8 |
Dow Jones Wilshire 5000 Index | 11.6 |
*Derived from data provided by Lipper Inc. |
STOCKS SURGED AFTER THE NOVEMBER ELECTION
During the past six months, stock investors tried to digest and act on conflicting information: generally positive economic indicators but relatively weak job growth; surging commodity prices but modest inflation for most other goods and services; and a falling U.S. dollar that was either a boon or a bane to the economy, depending on the pundit. Nevertheless, in the aggregate, stock prices moved upward, particularly after it was clear that November’s presidential election was not going to reprise the protracted 2000 contest.
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As they have for the past five years, mid- and small-capitalization stocks outpaced large-caps. Among the latter, value stocks—those whose prices are low relative to company earnings, book value, or other measures—generally outperformed their growth counterparts. Returns were positive across industry sectors, with energy-related stocks notching the highest results, boosted in part by crude oil prices that stayed above $40 a barrel through most of the period, at one point reaching a record of nearly $56.
Institutional Shares
This class of shares carries even lower expenses and is available for a minimum investment of $10 million.
In overseas markets, stock returns were generally superior to those seen in the United States. And the returns abroad were further augmented for U.S.-based investors by the weakness of the U.S. dollar, which reached multiyear lows relative to other major currencies near the end of calendar 2004.
BOND YIELDS ROSE
The Federal Reserve Board continued its gradual shift in monetary policy, moving away from its “accommodative” stance of keeping interest rates very low. During the fiscal half-year, the Fed raised its target for the federal funds rate in four quarter-point increments, from 1.50% to 2.50%. Short- and intermediate-term bonds felt the ripples. The yield of the 3-month U.S. Treasury bill, a proxy for money market yields, rose 117 basis points (1.17 percentage points) to 2.75%.
Market Barometer | Total Returns Periods Ended February 28, 2005 | ||
---|---|---|---|
Six Months | One Year | Five Years* | |
Stocks | |||
Russell 1000 Index (Large-caps) | 10.8% | 7.5% | -0.9% |
Russell 2000 Index (Small-caps) | 16.4 | 9.5 | 3.2 |
Dow Jones Wilshire 5000 Index | 11.6 | 7.9 | -1.2 |
(Entire market) | |||
MSCI All Country World Index | |||
ex USA (International) | 22.8 | 20.1 | 1.2 |
Bonds | |||
Lehman Aggregate Bond Index | 1.3% | 2.4% | 7.5% |
(Broad taxable market) | |||
Lehman Municipal Bond Index | 2.4 | 3.0 | 7.2 |
Citigroup 3-Month Treasury Bill Index | 0.9 | 1.4 | 2.7 |
CPI | |||
Consumer Price Index | 1.2% | 3.0% | 2.5% |
*Annualized |
The yield of the 10-year Treasury note rose 26 basis points to 4.38%. However, yields of longer-term bonds, which are less sensitive to Fed moves, were lower at the end of the fiscal half-year than at the beginning.
2
With price declines partly offsetting interest income, the total return of the overall taxable investment-grade bond market (as measured by the Lehman Brothers Aggregate Bond Index) was a modest 1.3%.
MAJOR SECTORS DELIVERED SOLID RETURNS FOR THE FUND
During the fiscal half-year, the Calvert Social Index Fund achieved returns of 6.6% for Investor Shares and 6.7% for Institutional Shares. The fund, now in its fifth full fiscal year of operation, maintained its record of closely tracking the performance of the Calvert Social Index, which consists of more than 600 large- and mid-cap stocks that have been screened for social responsibility. All 11 economic sectors in the index posted a gain for the period.
Historically, the Calvert Social Index’s screening criteria have resulted in a growth-oriented profile for the fund’s holdings. Because many companies in older industries, such as equipment manufacturers or producers of basic materials, have difficulty satisfying the index’s stringent environmental criteria, these traditionally value-oriented groups are not strongly represented in the portfolio. During the past six months, this positioning kept the index’s (and the fund’s) return below that of the broad market, as the value-oriented energy and raw-materials industries delivered exceptional returns. Instead, your fund held heavy weightings in sectors such as technology (21% of assets at period’s end) and financial services (30%). In other periods, of course, the fund’s growth orientation has produced returns higher than those of the broad market.
The largest contributions to the fund’s half-year returns came from its technology and consumer discretionary holdings. Together, these two sectors accounted for about a third of the fund’s assets, yet they contributed more than one-half of the overall return. Gains for technology were particularly strong. Health care stocks, which represented 15% of the fund’s holdings, suffered because of decreased earnings, increased regulatory concerns among pharmaceutical manufacturers, and the threat of product-liability lawsuits.
THE VALUE OF A LONG-TERM PERSPECTIVE
As always, we urge investors to treat this semiannual report on the markets and the fund as information about what has driven recent performance, not as a basis for sudden changes in their carefully
3
considered asset allocations. Investors enhance their ability to meet their long-term financial goals by sticking with portfolios balanced among stock, bond, and money market funds in proportions that are appropriate for their time horizons and tolerance for risk.
Whatever the market environment, the keys to long-term success are balance, diversification, and low costs. If you make these principles the foundation of your investment plan, you’ll be positioned to benefit no matter what occurs. For investors who want a socially screened stock fund that seeks long-term capital growth—and who are comfortable with the attendant risks—Vanguard Calvert Social Index Fund can play a valuable role.
Thank you for investing your assets with Vanguard.
Sincerely,
John J. Brennan
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
MARCH 15, 2005
Your Fund's Performance at a Glance | August 31, 2004-February 28, 2005 | |||
---|---|---|---|---|
Distributions Per Share | ||||
Starting Share Price | Ending Share Price | Income Dividends | Capital Gains | |
Calvert Social Index Fund | ||||
Investor Shares | $7.40 | $7.77 | $0.120 | $0.000 |
Institutional Shares | 7.41 | 7.78 | 0.128 | 0.000 |
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AS OF 2/28/2005 | FUND PROFILE This Profile provides a snapshot of the fund's characteristics, compared where indicated with both its unmanaged target index and a broad market index. Key terms are defined on page 6 |
CALVERT SOCIAL INDEX FUND
Portfolio Characteristics | |||
---|---|---|---|
Fund | Target Index* | Broad Index** | |
Number of Stocks | 628 | 624 | 4,973 |
Median Market Cap | $36.3B | $36.3B | $27.5B |
Price/Earnings Ratio | 24.6x | 24.5x | 21.2x |
Price/Book Ratio | 4.5x | 4.5x | 2.8x |
Yield | 1.4% | 1.6% | |
Investor Shares | 1.2% | ||
Institutional Shares | 1.3% | ||
Return on Equity | 19.0% | 19.0% | 15.8% |
Earnings Growth Rate | 13.3% | 13.4% | 8.0% |
Foreign Holdings | 0.4% | 0.4% | 1.1% |
Turnover Rate | 12%+ | -- | -- |
Expense Ratio | -- | -- | |
Investor Shares | 0.25%+ | ||
Institutional Shares | 0.12%+ | ||
Short-Term Reserves | 0% | -- | -- |
Volatility Measures | ||||
---|---|---|---|---|
Fund | Target Index* | Fund | Broad Index** | |
R-Squared | 1.00 | 1.00 | 0.97 | 1.00 |
Beta | 1.00 | 1.00 | 1.09 | 1.00 |
Sector Diversification (% of portfolio) | |||
---|---|---|---|
Fund | Target Index* | Broad Index** | |
Auto & Transportation | 2% | 2% | 3% |
Consumer Discretionary | 14 | 14 | 16 |
Consumer Staples | 5 | 5 | 7 |
Financial Services | 30 | 30 | 22 |
Health Care | 15 | 15 | 12 |
Integrated Oils | 0 | 0 | 5 |
Other Energy | 1 | 1 | 3 |
Materials & Processing | 2 | 2 | 5 |
Producer Durables | 5 | 5 | 4 |
Technology | 21 | 21 | 13 |
Utilities | 4 | 4 | 6 |
Other | 1 | 1 | 4 |
*Calvert Social Index.
**Dow Jones Wilshire 5000 Index.
† Annualized.
Ten Largest Holdings (% of total net assets) | |
---|---|
Microsoft Corp. | 3.7% |
(software) | |
Pfizer Inc. | 3.0 |
(pharmaceuticals) | |
Johnson & Johnson | 2.9 |
(pharmaceuticals) | |
Bank of America Corp. | 2.9 |
(banking) | |
International Business | 2.4 |
Machines Corp. | |
(computer hardware) | |
Intel Corp. | 2.3 |
(electronics) | |
American International Group, | 2.3 |
Inc. | |
(insurance) | |
The Procter & Gamble Co. | 2.0 |
(consumer products) | |
JPMorgan Chase & Co. | 2.0 |
(banking) | |
Cisco Systems, Inc. | 1.8 |
(computer hardware) | |
Top Ten | 25.3% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. |
Investment Focus
Visit our website at Vanguard.com
for regularly updated fund information.
5
GLOSSARY OF INVESTMENT TERMS
Beta. A measure of the magnitude of a fund’s past share-price fluctuations in relation to the ups and downs of a given market index. The index is assigned a beta of 1.00. Compared with a given index, a fund with a beta of 1.20 typically would have seen its share price rise or fall by 12% when the index rose or fell by 10%. A fund’s beta should be reviewed in conjunction with its R-squared (see definition below). The lower the R-squared, the less correlation there is between the fund and the index, and the less reliable beta is as an indicator of volatility.
Earnings Growth Rate. The average annual rate of growth in earnings over the past five years for the stocks now in a fund.
Expense Ratio. The percentage of a fund’s average net assets used to pay its annual administrative and advisory expenses. These expenses directly reduce returns to investors.
Foreign Holdings. The percentage of a fund’s equity assets represented by stocks or depositary receipts of companies based outside the United States.
Median Market Cap. An indicator of the size of companies in which a fund invests; the midpoint of market capitalization (market price x shares outstanding) of a fund’s stocks, weighted by the proportion of the fund’s assets invested in each stock. Stocks representing half of the fund’s assets have market capitalizations above the median, and the rest are below it.
Price/Book Ratio. The share price of a stock divided by its net worth, or book value, per share. For a fund, the weighted average price/book ratio of the stocks it holds.
Price/Earnings Ratio. The ratio of a stock’s current price to its per-share earnings over the past year. For a fund, the weighted average P/E of the stocks it holds. P/E is an indicator of market expectations about corporate prospects; the higher the P/E, the greater the expectations for a company’s future growth.
R-Squared. A measure of how much of a fund’s past returns can be explained by the returns from the market in general, as measured by a given index. If a fund’s total returns were precisely synchronized with an index’s returns, its R-squared would be 1.00. If the fund’s returns bore no relationship to the index’s returns, its R-squared would be 0.
Return on Equity. The annual average rate of return generated by a company during the past five years for each dollar of shareholder’s equity (net income divided by shareholder’s equity). For a fund, the weighted average return on equity for the companies whose stocks it holds.
Short-Term Reserves. The percentage of a fund invested in highly liquid, short-term securities that can be readily converted to cash.
Turnover Rate. An indication of the fund’s trading activity. Funds with high turnover rates incur higher transaction costs and may be more likely to distribute capital gains (which may be taxable to investors).
Yield. A snapshot of a fund’s income from interest and dividends. The yield, expressed as a percentage of the fund’s net asset value, is based on income earned over the past 30 days and is annualized, or projected forward for the coming year. The index yield is based on the current annualized rate of income provided by securities in the index.
6
AS OF 2/28/2005 | PERFORMANCE SUMMARY All of the returns in this report represent past performance, which is not a guarantee of future results that may be achieved by the fund. (For performance data current to the most recent month-end, which may be higher or lower than that cited, visit our website at www.vanguard.com.) Note, too, that both investment returns and principal value can fluctuate widely, so an investor's shares, when sold, could be worth more or less than their original cost. The returns shown do not reflect taxes that a shareholder would pay on fund distributions or on the sale of fund shares. |
CALVERT SOCIAL INDEX FUND
Fiscal-Year Total Returns (%) May 31, 2000–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on pages 21 and 22 for dividend and capital gains information.
Average Annual Total Returns for periods ended December 31, 2004
This table presents average annual total returns through the latest calendar quarter—rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information.
Since Inception | |||||
---|---|---|---|---|---|
Inception Date | One Year | Capital | Income | Total | |
Calvert Social Index Fund | |||||
Investor Shares* | 5/31/2000 | 8.27% | -4.74% | 0.93% | -3.81% |
Institutional Shares | 1/14/2003 | 8.51 | 13.91 | 1.54 | 15.45 |
*Total return figures do not reflect the $10 annual account maintenance fee applied on balances under $10,000. |
7
ABOUT YOUR FUND'S EXPENSES
We believe it is important for you to understand the impact of costs on your investment. All mutual funds have operating expenses. As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund's gross income, directly reduce the investment return of the fund. A fund's expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period. The table below illustrates your fund's costs in two ways:
• 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. To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading "Expenses Paid During Period."
Six Months Ended February 28, 2005 | |||
---|---|---|---|
Calvert Social Index Fund | Beginning Account Value Aug. 31, 2004 | Ending Account Value Feb. 28, 2005 | Expenses Paid During Period* |
Based on Actual Fund Return | |||
Investor Shares | $1,000.00 | $1,065.97 | $1.28 |
Institutional Shares | 1,000.00 | 1,066.94 | 0.62 |
Based on Hypothetical 5% Yearly Return | |||
Investor Shares | $1,000.00 | $1,023.55 | $1.25 |
Institutional Shares | 1,000.00 | 1,024.20 | 0.60 |
*These calculations are based on expenses incurred in the most recent six-month period. The fund’s annualized six-month expense ratios for that period are 0.25% for Investor Shares and 0.12% for Institutional Shares. The dollar amounts shown as “Expenses Paid” are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by the number of days in the most recent 12-month 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.
8
Note that the expenses shown in the table on page 8 are meant to highlight and help you compare ongoing costs only and do not reflect any transactional costs or account maintenance fees. They do not include your fund’s low-balance fee, which is described in the prospectus. If this fee were applied to your account, your costs would be higher. Your fund does not charge transaction fees, such as purchase or redemption fees, nor does it carry a “sales load.”
Annualized Expense Ratios: Your fund compared with its peer group | |||
---|---|---|---|
Investor Shares | Institutional Shares | Average Large-Cap Growth Fund | |
Calvert Social Index Fund | 0.25% | 0.12% | 1.51%* |
*Peer-group expense ratio is derived from data provided by Lipper Inc. and captures information through year-end 2004. |
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. You can find more information about the fund’s expenses, including annual expense ratios since inception, in the Financial Statements section of this report. For additional information on operating expenses and other shareholder costs, please refer to the appropriate fund prospectus.
9
AS OF 2/28/2005 | FINANCIAL STATEMENTS (UNAUDITED) |
STATEMENT OF NET ASSETS
This Statement provides a detailed list of the fund’s holdings, including each security’s market value on the last day of the reporting period. Securities are grouped and subtotaled by asset type (common stocks, bonds, etc.) and by industry sector. Other assets are added to, and liabilities are subtracted from, the value of Total Investments to calculate the fund’s Net Assets. Finally, Net Assets are divided by the outstanding shares of the fund to arrive at its share price, or Net Asset Value (NAV) Per Share.
At the end of the Statement of Net Assets, you will find a table displaying the composition of the fund’s net assets. Because all income and any realized gains must be distributed to shareholders each year, the bulk of net assets consists of Paid-in Capital (money invested by shareholders). The amounts shown for Undistributed Net Investment Income and Accumulated Net Realized Gains usually approximate the sums the fund had available to distribute to shareholders as income dividends or capital gains as of the statement date, but may differ because certain investments or transactions may be treated differently for financial statement and tax purposes. Any Accumulated Net Realized Losses, and any cumulative excess of distributions over net income or net realized gains, will appear as negative balances. Unrealized Appreciation (Depreciation) is the difference between the market value of the fund’s investments and their cost, and reflects the gains (losses) that would be realized if the fund were to sell all of its investments at their statement-date values.
The fund provides a complete list of its holdings four times in each fiscal year, at the quarter-ends. For the second and fourth fiscal quarters, the lists appear in the fund’s semiannual and annual reports to shareholders. For the first and third fiscal quarters, the fund files the lists with the Securities and Exchange Commission on Form N-Q. Shareholders can look up the fund’s Forms N-Q on the SEC’s website at www.sec.gov. Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room (see the back cover of this report for further information).
Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
COMMON STOCKS (99.8%) | ||||
Auto & Transportation (2.0%) | ||||
United Parcel Service, Inc. | 30,525 | $2,365 | ||
FedEx Corp. | 15,869 | 1,552 | ||
Harley-Davidson, Inc. | 15,622 | 967 | ||
Southwest Airlines Co. | 37,265 | 516 | ||
Genuine Parts Co. | 9,279 | 402 | ||
Expeditors International of | ||||
Washington, Inc. | 5,601 | 311 | ||
C.H. Robinson Worldwide, Inc. | 4,268 | 234 | ||
BorgWarner, Inc. | 3,000 | 158 | ||
Gentex Corp. | 4,100 | 139 | ||
CNF Inc. | 2,665 | 122 | ||
JetBlue Airways Corp. | 5,093 | 92 | ||
ArvinMeritor, Inc. | 3,600 | 61 | ||
Visteon Corp. | 6,900 | 46 | ||
6,965 | ||||
Consumer Discretionary (14.0%) | ||||
Home Depot, Inc. | 117,716 | 4,711 | ||
*Time Warner, Inc. | 233,050 | 4,015 | ||
Gillette Co. | 48,328 | 2,428 | ||
eBay Inc. | 52,466 | 2,248 | ||
Target Corp. | 43,854 | 2,229 | ||
Lowe's Cos., Inc. | 37,759 | 2,219 | ||
Yahoo! Inc. | 61,140 | 1,973 | ||
Kimberly-Clark Corp. | 25,880 | 1,708 | ||
Liberty Media Corp. | 136,411 | 1,383 | ||
Costco Wholesale Corp. | 24,441 | 1,139 | ||
Starbucks Corp. | 21,127 | 1,095 | ||
Avon Products, Inc. | 25,050 | 1,071 | ||
Electronic Arts Inc. | 15,886 | 1,024 | ||
The McGraw-Hill Cos., Inc. | 10,159 | 933 | ||
Omnicom Group Inc. | 9,907 | 902 | ||
Staples, Inc. | 26,409 | 832 | ||
Kohl's Corp. | 16,085 | 770 | ||
Best Buy Co., Inc. | 13,988 | 756 | ||
The Gap, Inc. | 34,811 | 743 | ||
Apollo Group, Inc. Class A | 8,065 | 594 | ||
Bed Bath & Beyond, Inc. | 15,754 | 591 | ||
Amazon.com, Inc. | 15,647 | 550 | ||
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Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
Eastman Kodak Co. | 15,252 | $518 | ||
Harman International | ||||
Industries, Inc. | 3,549 | 398 | ||
R.R. Donnelley & Sons Co. | 11,555 | 384 | ||
Sirius Satellite Radio, Inc. | 66,786 | 372 | ||
Univision Communications Inc. | 13,606 | 359 | ||
Liberty Media International Inc | ||||
Class A | 8,217 | 355 | ||
XM Satellite Radio Holdings, In | 10,775 | 355 | ||
Black & Decker Corp. | 4,240 | 352 | ||
Dollar General Corp. | 16,145 | 343 | ||
Nordstrom, Inc. | 6,338 | 341 | ||
EchoStar Communications Corp. | ||||
Class A | 11,361 | 338 | ||
Newell Rubbermaid, Inc. | 14,458 | 322 | ||
*Office Depot, Inc. | 16,593 | 319 | ||
Washington Post Co. Class B | 328 | 295 | ||
Estee Lauder Cos. Class A | 6,485 | 285 | ||
*Chico's FAS, Inc. | 9,528 | 281 | ||
New York Times Co. Class A | 7,613 | 279 | ||
Family Dollar Stores, Inc. | 8,429 | 277 | ||
Robert Half International, Inc. | 9,055 | 264 | ||
PETsMART, Inc. | 7,673 | 234 | ||
Alberto-Culver Co. Class B | 4,309 | 225 | ||
Ross Stores, Inc. | 8,019 | 225 | ||
Whirlpool Corp. | 3,507 | 224 | ||
Manpower Inc. | 4,804 | 210 | ||
Darden Restaurants Inc. | 7,832 | 210 | ||
Jones Apparel Group, Inc. | 6,579 | 209 | ||
Fastenal Co. | 3,458 | 202 | ||
The Stanley Works | 4,348 | 201 | ||
E.W. Scripps Co. Class A | 4,318 | 199 | ||
CDW Corp. | 3,438 | 198 | ||
*Advance Auto Parts, Inc. | 3,921 | 198 | ||
*Brinker International, Inc. | 5,132 | 194 | ||
CarMax, Inc. | 5,463 | 180 | ||
*Getty Images, Inc. | 2,494 | 178 | ||
Outback Steakhouse | 3,900 | 175 | ||
*Lamar Advertising Co. Class A | 4,416 | 174 | ||
Williams-Sonoma, Inc. | 4,924 | 171 | ||
*Dollar Tree Stores, Inc. | 6,174 | 166 | ||
*Monster Worldwide Inc. | 5,624 | 162 | ||
*Iron Mountain, Inc. | 5,775 | 156 | ||
Sabre Holdings Corp. | 7,174 | 151 | ||
*O'Reilly Automotive, Inc. | 2,890 | 147 | ||
*The Cheesecake Factory | 4,050 | 138 | ||
The Corporate Executive Board C | 2,100 | 131 | ||
*Tech Data Corp. | 3,070 | 126 | ||
Belo Corp. Class A | 5,239 | 124 | ||
Pixar, Inc. | 1,374 | 123 | ||
The Toro Co. | 1,350 | 117 | ||
Reebok International Ltd. | 2,600 | 115 | ||
*BJ's Wholesale Club, Inc. | 3,699 | 113 | ||
*Convergys Corp. | 7,401 | 111 | ||
Borders Group, Inc. | 4,104 | 106 | ||
*Valassis Communications, Inc. | 2,764 | 103 | ||
The Brink's Co. | 2,966 | 103 | ||
*R.H. Donnelley Corp. | 1,678 | 102 | ||
Saks Inc. | 6,660 | 101 | ||
*Barnes & Noble, Inc. | 2,899 | 99 | ||
Meredith Corp. | 2,142 | 98 | ||
*Laureate Education Inc. | 2,215 | 96 | ||
SCP Pool Corp. | 2,820 | 96 | ||
*Weight Watchers | ||||
International, Inc. | 2,205 | 95 | ||
Snap-On Inc. | 2,779 | 92 | ||
Regis Corp. | 2,300 | 91 | ||
*Education Management Corp. | 3,082 | 90 | ||
Lee Enterprises, Inc. | 1,875 | 86 | ||
American Greetings Corp. Class | 3,456 | 85 | ||
Entercom Communications Corp. | 2,470 | 85 | ||
*Corinthian Colleges, Inc. | 4,818 | 83 | ||
*The Yankee Candle Co., Inc. | 2,655 | 82 | ||
Ruby Tuesday, Inc. | 3,392 | 82 | ||
*Timberland Co. | 1,171 | 82 | ||
Tractor Supply Co. | 1,894 | 81 | ||
Panera Bread Co. | 1,498 | 80 | ||
*United Stationers, Inc. | 1,771 | 78 | ||
Strayer Education, Inc. | 732 | 77 | ||
The McClatchy Co. Class A | 1,067 | 77 | ||
*CEC Entertainment Inc. | 1,900 | 74 | ||
John Wiley & Sons Class A | 2,082 | 72 | ||
Harte-Hanks, Inc. | 2,682 | 72 | ||
*Ask Jeeves, Inc. | 3,081 | 70 | ||
Ethan Allen Interiors, Inc. | 2,000 | 70 | ||
Media General, Inc. Class A | 1,072 | 69 | ||
P.F. Chang's China Bistro, Inc. | 1,248 | 68 | ||
*Earthlink, Inc. | 7,457 | 65 | ||
Arbitron Inc. | 1,600 | 65 | ||
Linens 'n Things, Inc. | 2,400 | 65 | ||
*CNET Networks, Inc. | 6,833 | 62 | ||
Furniture Brands International | 2,600 | 60 | ||
Maytag Corp. | 3,896 | 59 | ||
DeVry, Inc. | 3,200 | 56 | ||
The Pep Boys | ||||
(Manny, Moe & Jack) | 3,024 | 55 | ||
Blyth, Inc. | 1,700 | 54 | ||
Tommy Hilfiger Corp. | 4,799 | 51 | ||
*DoubleClick Inc. | 6,242 | 49 | ||
Viad Corp. | 1,162 | 31 | ||
Krispy Kreme Doughnuts, Inc. | 2,875 | 16 | ||
49,271 | ||||
11
Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
Consumer Staples (5.1%) | ||||
The Procter & Gamble Co. | 134,696 | $7,151 | ||
Walgreen Co. | 54,312 | 2,326 | ||
Colgate-Palmolive Co. | 28,177 | 1,491 | ||
Sysco Corp. | 33,880 | 1,166 | ||
CVS Corp. | 21,061 | 1,049 | ||
General Mills, Inc. | 18,839 | 987 | ||
H.J. Heinz Co. | 18,597 | 700 | ||
Hershey Foods Corp. | 9,160 | 577 | ||
Kellogg Co. | 12,494 | 550 | ||
Wm. Wrigley Jr. Co. | 7,287 | 485 | ||
Whole Foods Market, Inc. | 3,286 | 338 | ||
McCormick & Co., Inc. | 6,014 | 228 | ||
SuperValu Inc. | 7,179 | 228 | ||
J.M. Smucker Co. | 3,118 | 153 | ||
Church & Dwight, Inc. | 3,224 | 114 | ||
Del Monte Foods Co. | 10,345 | 110 | ||
*NBTY, Inc. | 3,200 | 81 | ||
Performance Food Group Co. | 2,514 | 68 | ||
17,802 | ||||
Financial Services (30.0%) | ||||
�� Banks--New York City (2.3%) | ||||
JPMorgan Chase & Co. | 188,735 | 6,898 | ||
The Bank of New York Co., Inc. | 41,080 | 1,243 | ||
Banks--Outside New York City (11.7%) | ||||
Bank of America Corp. | 215,550 | 10,055 | ||
Wells Fargo & Co. | 89,415 | 5,309 | ||
Wachovia Corp. | 85,094 | 4,511 | ||
U.S. Bancorp | 99,499 | 2,960 | ||
SunTrust Banks, Inc. | 18,998 | 1,376 | ||
Fifth Third Bancorp | 26,338 | 1,179 | ||
BB& T Corp. | 29,354 | 1,149 | ||
National City Corp. | 30,793 | 1,101 | ||
Regions Financial Corp. | 24,477 | 790 | ||
PNC Financial Services Group | 14,953 | 787 | ||
State Street Corp. | 17,894 | 785 | ||
KeyCorp | 21,491 | 709 | ||
North Fork Bancorp, Inc. | 23,184 | 668 | ||
Mellon Financial Corp. | 22,453 | 644 | ||
Comerica, Inc. | 9,051 | 517 | ||
AmSouth Bancorp | 18,803 | 470 | ||
M & T Bank Corp. | 4,497 | 445 | ||
Northern Trust Corp. | 10,271 | 434 | ||
Marshall & Ilsley Corp. | 10,160 | 411 | ||
Synovus Financial Corp. | 13,740 | 373 | ||
Popular, Inc. | 12,904 | 342 | ||
Banknorth Group, Inc. | 9,085 | 328 | ||
Zions Bancorp | 4,790 | 317 | ||
Compass Bancshares Inc. | 6,519 | 296 | ||
First Horizon National Corp. | 6,500 | 277 | ||
Huntington Bancshares Inc. | 11,524 | 260 | ||
Commerce Bancorp, Inc. | 4,185 | 256 | ||
Hibernia Corp. Class A | 8,241 | 212 | ||
Associated Banc-Corp | 6,358 | 204 | ||
Mercantile Bankshares Corp. | 4,164 | 202 | ||
Doral Financial Corp. | 4,900 | 194 | ||
TCF Financial Corp. | 6,924 | 191 | ||
Investors Financial Services Corp. | 3,472 | 174 | ||
Commerce Bancshares, Inc. | 3,660 | 173 | ||
City National Corp. | 2,405 | 165 | ||
Sky Financial Group, Inc. | 5,600 | 156 | ||
Colonial BancGroup, Inc. | 7,058 | 144 | ||
Fulton Financial Corp. | 6,449 | 138 | ||
Valley National Bancorp | 5,191 | 135 | ||
Bank of Hawaii Corp. | 2,827 | 129 | ||
Cullen/Frost Bankers, Inc. | 2,700 | 125 | ||
Wilmington Trust Corp. | 3,485 | 118 | ||
The South Financial Group, Inc. | 3,700 | 114 | ||
UCBH Holdings, Inc. | 2,362 | 98 | ||
FirstMerit Corp. | 3,742 | 97 | ||
East West Bancorp, Inc. | 2,683 | 96 | ||
Whitney Holdings Corp. | 2,151 | 95 | ||
First BanCorp Puerto Rico | 2,018 | 95 | ||
Westamerica Bancorporation | 1,700 | 89 | ||
Hudson United Bancorp | 2,400 | 85 | ||
*Silicon Valley Bancshares | 1,900 | 83 | ||
First Midwest Bancorp, Inc. | 2,423 | 83 | ||
Park National Corp. | 693 | 82 | ||
Cathay General Bancorp | 2,262 | 82 | ||
BancorpSouth, Inc. | 3,798 | 80 | ||
Old National Bancorp | 3,665 | 76 | ||
United Bankshares, Inc. | 2,200 | 75 | ||
Trustmark Corp. | 2,670 | 73 | ||
Texas Regional Bancshares, Inc. | 2,413 | 72 | ||
Greater Bay Bancorp | 2,700 | 68 | ||
Southwest Bancorporation of | ||||
Texas, Inc. | 3,400 | 65 | ||
Chittenden Corp. | 2,425 | 64 | ||
Pacific Capital Bancorp | 2,275 | 64 | ||
Citizens Banking Corp. | 1,900 | 59 | ||
Diversified Financial Services (1.9%) | ||||
American Express Co. | 59,504 | 3,222 | ||
The Goldman Sachs Group, Inc. | 21,837 | 2,376 | ||
CIT Group Inc. | 11,182 | 451 | ||
The Chicago Mercantile Exchange | 1,433 | 296 | ||
Leucadia National Corp. | 3,667 | 123 | ||
*BISYS Group, Inc. | 6,329 | 94 | ||
Finance Companies (0.3%) | ||||
Capital One Financial Corp. | 12,716 | 975 | ||
12
Calvert Social Index Fund | Shares | Market Value^ (000) |
---|---|---|
Finance--Small Loan (0.4%) | ||
SLM Corp. | 23,170 | $1,131 |
*AmeriCredit Corp. | 8,245 | 194 |
Financial Data Processing Services (1) | ||
First Data Corp. | 45,404 | 1,862 |
Automatic Data Processing, Inc. | 31,253 | 1,343 |
Paychex, Inc. | 17,921 | 572 |
SunGard Data Systems, Inc. | 15,304 | 400 |
Fiserv, Inc. | 10,370 | 393 |
DST Systems, Inc. | 3,575 | 170 |
*CheckFree Corp. | 3,408 | 131 |
Fair, Isaac, Inc. | 3,700 | 125 |
Global Payments Inc. | 2,045 | 114 |
Deluxe Corp. | 2,651 | 103 |
Jack Henry & Associates Inc. | 4,100 | 81 |
Financial Information Services (0.2%) | ||
Moody's Corp. | 6,629 | 556 |
*The Dun & Bradstreet Corp. | 3,775 | 232 |
Dow Jones & Co., Inc. | 2,362 | 88 |
Financial Miscellaneous (2.8%) | ||
Fannie Mae | 51,264 | 2,997 |
Freddie Mac | 36,510 | 2,264 |
MBNA Corp. | 59,875 | 1,519 |
Ambac Financial Group, Inc. | 5,809 | 452 |
MBIA, Inc. | 7,636 | 447 |
H & R Block, Inc. | 8,161 | 435 |
Fidelity National Financial, Inc. | 8,531 | 377 |
MGIC Investment Corp. | 5,192 | 326 |
*Providian Financial Corp. | 15,450 | 265 |
Radian Group, Inc. | 4,883 | 236 |
First American Corp. | 4,117 | 150 |
Brown & Brown, Inc. | 3,000 | 139 |
Nationwide Financial Services, Inc. | 3,000 | 110 |
*CapitalSource Inc. | 3,512 | 81 |
Insurance--Life (0.8%) | ||
Prudential Financial, Inc. | 27,552 | 1,570 |
The Principal Financial Group, Inc. | 16,550 | 646 |
Jefferson-Pilot Corp. | 7,185 | 352 |
*Conseco, Inc. | 7,938 | 150 |
AmerUs Group Co. | 2,121 | 102 |
Insurance--Multiline (4.4%) | ||
American International | ||
Group, Inc. | 121,235 | 8,098 |
St. Paul Travelers Cos., Inc. | 35,382 | 1,356 |
The Hartford Financial Services | ||
Group Inc. | 15,473 | 1,113 |
AFLAC Inc. | 26,896 | 1,031 |
CIGNA Corp. | 7,307 | 663 |
Lincoln National Corp. | 9,346 | 438 |
Cincinnati Financial Corp. | 8,295 | 371 |
SAFECO Corp. | 7,352 | 351 |
Willis Group Holdings Ltd. | 7,645 | 302 |
Torchmark Corp. | 5,783 | 301 |
UnumProvident Corp. | 15,689 | 265 |
Markel Corp. | 487 | 174 |
Arthur J. Gallagher & Co. | 4,845 | 145 |
Protective Life Corp. | 3,380 | 135 |
StanCorp Financial Group, Inc. | 1,500 | 131 |
Unitrin, Inc. | 2,396 | 112 |
Allmerica Financial Corp. | 2,773 | 99 |
American National Insurance Co. | 907 | 99 |
Hilb, Rogal and Hamilton Co. | 1,664 | 57 |
Insurance--Property-Casualty (1.4%) | ||
Progressive Corp. of Ohio | 9,282 | 808 |
The Chubb Corp. | 10,142 | 802 |
ACE Ltd. | 15,101 | 671 |
XL Capital Ltd. Class A | 7,401 | 555 |
White Mountains | ||
Insurance Group Inc. | 425 | 278 |
Everest Re Group, Ltd. | 2,963 | 257 |
The PMI Group Inc. | 5,056 | 204 |
W.R. Berkley Corp. | 3,862 | 198 |
RenaissanceRe Holdings Ltd. | 3,800 | 181 |
PartnerRe Ltd. | 2,837 | 178 |
HCC Insurance Holdings, Inc. | 3,400 | 128 |
Commerce Group, Inc. | 1,600 | 109 |
Transatlantic Holdings, Inc. | 1,450 | 97 |
Fremont General Corp. | 3,632 | 91 |
IPC Holdings Ltd. | 1,948 | 82 |
*Ohio Casualty Corp. | 3,300 | 80 |
Erie Indemnity Co. Class A | 1,516 | 78 |
Mercury General Corp. | 1,400 | 77 |
Investment Management Companies (0.3%) | ||
T. Rowe Price Group Inc. | 6,704 | 412 |
Eaton Vance Corp. | 6,436 | 174 |
Federated Investors, Inc. | 5,016 | 148 |
SEI Investments Inc. | 3,644 | 135 |
*Affiliated Managers Group, Inc. | 1,560 | 101 |
Waddell & Reed Financial, Inc. | 4,350 | 90 |
Real Estate Investment Trust (0.1%) | ||
New Century REIT, Inc. | 2,546 | 129 |
*La Quinta Corp. REIT | 8,622 | 80 |
13
Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
Rent & Lease Services--Commercial (0.0%) | ||||
*United Rentals, Inc. | 3,397 | $64 | ||
Savings & Loan (1.3%) | ||||
Washington Mutual, Inc. | 46,276 | 1,942 | ||
Golden West Financial Corp. | 16,218 | 1,004 | ||
Sovereign Bancorp, Inc. | 18,115 | 416 | ||
New York Community | ||||
Bancorp, Inc. | 12,773 | 235 | ||
People's Bank | 4,922 | 188 | ||
Independence Community | ||||
Bank Corp. | 4,171 | 166 | ||
Astoria Financial Corp. | 3,702 | 139 | ||
Hudson City Bancorp, Inc. | 3,587 | 133 | ||
Webster Financial Corp. | 2,833 | 124 | ||
IndyMac Bancorp, Inc. | 3,213 | 116 | ||
Washington Federal Inc. | 4,519 | 107 | ||
Downey Financial Corp. | 1,100 | 69 | ||
Commercial Federal Corp. | 2,100 | 57 | ||
Securities Brokers & Services (0.6%) | ||||
Charles Schwab Corp. | 58,923 | 619 | ||
Franklin Resources Corp. | 7,494 | 526 | ||
Legg Mason Inc. | 5,335 | 430 | ||
*E*TRADE Group, Inc. | 19,289 | 256 | ||
A.G. Edwards & Sons, Inc. | 4,163 | 179 | ||
Ameritrade Holding Corp. | 15,054 | 160 | ||
Jefferies Group, Inc. | 2,600 | 99 | ||
105,208 | ||||
Health Care (14.8%) | ||||
Pfizer Inc. | 400,106 | 10,519 | ||
Johnson & Johnson | 157,270 | 10,317 | ||
*Amgen, Inc. | 67,045 | 4,131 | ||
Medtronic, Inc. | 64,064 | 3,339 | ||
Bristol-Myers Squibb Co. | 102,972 | 2,577 | ||
*WellPoint Inc. | 15,785 | 1,927 | ||
Cardinal Health, Inc. | 22,835 | 1,337 | ||
Boston Scientific Corp. | 31,963 | 1,044 | ||
*Caremark Rx, Inc. | 24,142 | 924 | ||
*Forest Laboratories, Inc. | 19,579 | 836 | ||
*Gilead Sciences, Inc. | 22,822 | 789 | ||
Becton, Dickinson & Co. | 12,504 | 749 | ||
*St. Jude Medical, Inc. | 19,006 | 743 | ||
Stryker Corp. | 14,648 | 727 | ||
*Biogen Idec Inc. | 17,961 | 694 | ||
*Genzyme Corp.-General Division | 12,041 | 675 | ||
McKesson Corp. | 14,560 | 544 | ||
Allergan, Inc. | 7,006 | 527 | ||
Biomet, Inc. | 12,456 | 526 | ||
Quest Diagnostics, Inc. | 4,154 | 413 | ||
AmerisourceBergen Corp. | 5,979 | 358 | ||
*Laboratory Corp. of | ||||
America Holdings | 7,364 | $353 | ||
*MedImmune Inc. | 13,107 | 316 | ||
*Patterson Cos | 6,182 | 307 | ||
*Coventry Health Care Inc. | 4,825 | 304 | ||
IMS Health, Inc. | 12,294 | 299 | ||
Health Management Associates | ||||
Class A | 12,160 | 279 | ||
*Varian Medical Systems, Inc. | 7,242 | 260 | ||
Express Scripts Inc. | 3,448 | 260 | ||
*Hospira, Inc. | 8,279 | 245 | ||
Beckman Coulter, Inc. | 3,300 | 232 | ||
*Barr Pharmaceuticals Inc. | 4,803 | 229 | ||
*DaVita, Inc. | 5,244 | 221 | ||
*Lincare Holdings, Inc. | 5,320 | 216 | ||
DENTSPLY International Inc. | 3,756 | 206 | ||
*Invitrogen Corp. | 2,772 | 194 | ||
Omnicare, Inc. | 5,512 | 190 | ||
Cooper Cos., Inc. | 2,161 | 178 | ||
*Health Net Inc. | 5,929 | 177 | ||
IVAX Corp. | 11,057 | 177 | ||
*Henry Schein, Inc. | 2,326 | 168 | ||
*Dade Behring Holdings Inc. | 2,351 | 147 | ||
*Renal Care Group, Inc. | 3,502 | 138 | ||
*Affymetrix, Inc. | 3,225 | 138 | ||
*Millennium Pharmaceuticals, Inc. | 15,964 | 137 | ||
*OSI Pharmaceuticals, Inc. | 2,500 | 137 | ||
*Edwards Lifesciences Corp. | 3,166 | 136 | ||
Universal Health Services Class B | 2,882 | 136 | ||
*Gen-Probe Inc. | 2,651 | 135 | ||
*Cytyc Corp. | 5,827 | 133 | ||
*WebMD Corp. | 16,358 | 123 | ||
*Millipore Corp. | 2,600 | 118 | ||
*Pharmaceutical Product | ||||
Development, Inc. | 2,600 | 111 | ||
*Respironics, Inc. | 1,900 | 110 | ||
*Accredo Health, Inc. | 2,550 | 109 | ||
*Amylin Pharmaceuticals, Inc. | 5,044 | 108 | ||
*ResMed Inc. | 1,769 | 104 | ||
*Martek Biosciences Corp. | 1,525 | 102 | ||
Medicis Pharmaceutical Corp. | 2,932 | 101 | ||
*IDEXX Laboratories Corp. | 1,800 | 100 | ||
*VCA Antech, Inc. | 4,316 | 87 | ||
*MGI Pharma, Inc. | 3,706 | 85 | ||
*Apria Healthcare Group Inc. | 2,600 | 84 | ||
*Nektar Therapeutics | 4,390 | 76 | ||
*LifePoint Hospitals, Inc. | 1,900 | 76 | ||
Invacare Corp. | 1,600 | 75 | ||
*Neurocrine Biosciences, Inc. | 1,879 | 75 | ||
*Protein Design Labs, Inc. | 4,904 | 73 | ||
*ICOS Corp. | 3,117 | 69 | ||
14
Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
*Techne Corp. | 2,000 | $68 | ||
*PAR Pharmaceutical Cos. Inc. | 1,788 | 66 | ||
*Onyx Pharmaceuticals, Inc. | 1,805 | 52 | ||
Taro Pharmaceutical Industries Ltd. | 1,276 | 36 | ||
51,752 | ||||
Materials & Processing (1.7%) | ||||
Masco Corp. | 23,530 | 793 | ||
Weyerhaeuser Co. | 11,776 | 788 | ||
Praxair, Inc. | 17,218 | 772 | ||
Air Products & Chemicals, Inc. | 11,252 | 705 | ||
American Standard Cos., Inc. | 9,537 | 437 | ||
Avery Dennison Corp. | 5,143 | 312 | ||
Ecolab, Inc. | 9,784 | 310 | ||
The St. Joe Co. | 3,772 | 274 | ||
Sealed Air Corp. | 4,464 | 233 | ||
Sigma-Aldrich Corp. | 3,141 | 194 | ||
Bemis Co., Inc. | 5,645 | 168 | ||
Sonoco Products Co. | 5,152 | 150 | ||
Lubrizol Corp. | 3,471 | 148 | ||
Harsco Corp. | 2,154 | 126 | ||
Corn Products International, Inc. | 3,728 | 104 | ||
Hughes Supply, Inc. | 3,288 | 101 | ||
AptarGroup Inc. | 1,775 | 92 | ||
York International Corp. | 2,196 | 85 | ||
Airgas, Inc. | 3,345 | 84 | ||
Worthington Industries, Inc. | 3,600 | 75 | ||
5,951 | ||||
Other Energy (0.9%) | ||||
XTO Energy, Inc. | 13,809 | 629 | ||
EOG Resources, Inc. | 6,264 | 571 | ||
Smith International, Inc. | 5,535 | 356 | ||
Pioneer Natural Resources Co. | 7,657 | 323 | ||
Chesapeake Energy Corp. | 14,222 | 308 | ||
Equitable Resources, Inc. | 3,100 | 184 | ||
*Cooper Cameron Corp. | 2,900 | 167 | ||
*Grant Prideco, Inc. | 6,445 | 156 | ||
Patina Oil & Gas Corp. | 3,490 | 141 | ||
*FMC Technologies Inc. | 3,339 | 115 | ||
Key Energy Services, Inc. | 6,800 | 94 | ||
3,044 | ||||
Producer Durables (4.8%) | ||||
*Applied Materials, Inc. | 89,740 | 1,570 | ||
Emerson Electric Co. | 22,338 | 1,481 | ||
Illinois Tool Works, Inc. | 13,760 | 1,235 | ||
Deere & Co. | 13,215 | 940 | ||
*Xerox Corp. | 50,366 | 786 | ||
Danaher Corp. | 13,597 | 737 | ||
Agilent Technologies, Inc. | 23,617 | 567 | ||
Pitney Bowes, Inc. | 12,233 | 561 | ||
Lexmark International, Inc. | 6,845 | 548 | ||
KLA-Tencor Corp. | 10,440 | 516 | ||
D. R. Horton, Inc. | 11,622 | 509 | ||
Pulte Homes, Inc. | 5,549 | 433 | ||
Parker Hannifin Corp. | 6,394 | 421 | ||
Dover Corp. | 10,730 | 415 | ||
Cooper Industries, Inc. Class A | 4,900 | 340 | ||
Waters Corp. | 6,433 | 314 | ||
W.W. Grainger, Inc. | 4,351 | 273 | ||
KB HOME | 2,012 | 251 | ||
*NVR, Inc. | 309 | 245 | ||
*LAM Research Corp. | 7,193 | 226 | ||
Novellus Systems, Inc. | 7,525 | 222 | ||
Pentair, Inc. | 5,314 | 220 | ||
American Power Conversion Corp. | 9,997 | 220 | ||
American Tower Corp. Class A | 11,808 | 216 | ||
Diebold, Inc. | 3,852 | 206 | ||
*Crown Castle International Corp. | 11,805 | 193 | ||
Pall Corp. | 6,607 | 179 | ||
Ryland Group, Inc. | 2,492 | 173 | ||
Garmin Ltd. | 3,114 | 160 | ||
Cummins Inc. | 2,156 | 158 | ||
*Teradyne, Inc. | 10,227 | 158 | ||
Hubbell Inc. Class B | 2,673 | 144 | ||
Roper Industries Inc. | 2,200 | 142 | ||
Tektronix, Inc. | 4,900 | 142 | ||
Graco, Inc. | 3,616 | 140 | ||
Standard Pacific Corp. | 1,647 | 132 | ||
MDC Holdings, Inc. | 1,643 | 131 | ||
Donaldson Co., Inc. | 3,900 | 124 | ||
*Mettler-Toledo International Inc. | 2,309 | 121 | ||
Terex Corp. | 2,662 | 120 | ||
Herman Miller, Inc. | 3,755 | 109 | ||
HNI Corp. | 2,456 | 107 | ||
Briggs & Stratton Corp. | 2,708 | 107 | ||
IDEX Corp. | 2,620 | 103 | ||
*Andrew Corp. | 7,988 | 97 | ||
Kennametal, Inc. | 1,900 | 93 | ||
*AGCO Corp. | 4,717 | 92 | ||
Plantronics, Inc. | 2,475 | 90 | ||
*Polycom, Inc. | 5,139 | 83 | ||
Flowserve Corp. | 3,000 | 75 | ||
*Varian Semiconductor | ||||
Equipment Associates, Inc. | 1,878 | 75 | ||
Molex, Inc. Class A | 2,917 | 67 | ||
Cognex Corp. | 2,094 | 58 | ||
*Cymer, Inc. | 1,997 | 58 | ||
Molex, Inc. | 100 | 3 | ||
16,886 | ||||
Technology (20.9%) | ||||
Communications Technology (3.5%) | ||||
*Cisco Systems, Inc. | 358,285 | 6,241 | ||
QUALCOMM Inc. | 86,198 | 3,113 | ||
15
Calvert Social Index Fund | Shares | Market Value^ (000) |
---|---|---|
Juniper Networks, Inc. | 26,153 | $563 |
*NCR Corp. | 9,920 | 387 |
Avaya Inc. | 22,073 | 309 |
Scientific-Atlanta, Inc. | 8,054 | 249 |
Harris Corp. | 3,552 | 237 |
*Tellabs, Inc. | 22,358 | 159 |
*SpectraSite, Inc. | 2,467 | 152 |
JDS Uniphase Corp. | 72,467 | 138 |
ADC Telecommunications, Inc. | 42,916 | 99 |
*Avocent Corp. | 2,631 | 90 |
*TIBCO Software Inc. | 9,098 | 89 |
*Brocade Communications | ||
Systems, Inc. | 13,500 | 84 |
3Com Corp. | 20,859 | 75 |
UTStarcom, Inc. | 5,223 | 67 |
*Foundry Networks, Inc. | 6,344 | 66 |
*CIENA Corp. | 29,763 | 59 |
ADTRAN Inc. | 2,194 | 41 |
Computer Services Software & Systems (5.6 | ||
Microsoft Corp. | 512,328 | 12,900 |
Symantec Corp. | 37,642 | 829 |
Adobe Systems, Inc. | 12,672 | 782 |
Veritas Software Corp. | 22,976 | 556 |
*Intuit, Inc. | 9,347 | 400 |
Autodesk, Inc. | 11,932 | 355 |
*Cognizant Technology | ||
Solutions Corp. | 7,051 | 333 |
*Affiliated Computer Services, Inc. | ||
Class A | 6,435 | 333 |
*Amdocs Ltd. | 9,976 | 293 |
*Mercury Interactive Corp. | 4,906 | 225 |
*Check Point Software | ||
Technologies Ltd. | 9,619 | 213 |
Siebel Systems, Inc. | 23,864 | 204 |
*QLogic Corp. | 5,035 | 203 |
*Citrix Systems, Inc. | 8,995 | 202 |
*Cadence Design Systems, Inc. | 14,380 | 198 |
BMC Software, Inc. | 11,681 | 175 |
BEA Systems, Inc. | 20,284 | 168 |
Ceridian Corp. | 7,777 | 142 |
*Macromedia, Inc. | 3,702 | 125 |
*Compuware Corp. | 18,239 | 123 |
*Red Hat, Inc. | 9,171 | 105 |
*Hyperion Solutions Corp. | 2,039 | 103 |
Novell, Inc. | 19,476 | 102 |
Acxiom Corp. | 4,517 | 102 |
Sybase, Inc. | 5,110 | 96 |
Reynolds & Reynolds Class A | 3,403 | 94 |
*Parametric Technology Corp. | 13,870 | 80 |
National Instruments Corp. | 2,750 | 79 |
*Akamai Technologies, Inc. | 6,063 | 67 |
Mentor Graphics Corp. | 3,843 | 53 |
*Electronics for Imaging, Inc. | 2,863 | 47 |
Computer Technology (6.6%) | ||
International Business | ||
Machines Corp. | 91,120 | 8,436 |
Dell Inc. | 117,791 | 4,722 |
Hewlett-Packard Co. | 144,951 | 3,015 |
Apple Computer, Inc. | 40,290 | 1,807 |
EMC Corp. | 128,184 | 1,623 |
Sun Microsystems, Inc. | 176,295 | 744 |
Electronic Data Systems Corp. | 26,944 | 574 |
*Network Appliance, Inc. | 18,898 | 567 |
*NVIDIA Corp. | 8,294 | 240 |
*SanDisk Corp. | 8,515 | 229 |
Seagate Technology | 11,050 | 199 |
*Zebra Technologies Corp. Class A | 3,837 | 191 |
*Storage Technology Corp. | 5,878 | 187 |
Synopsys, Inc. | 8,145 | 147 |
*Unisys Corp. | 17,481 | 134 |
*Western Digital Corp. | 10,915 | 123 |
*Ingram Micro, Inc. Class A | 6,575 | 118 |
Emulex Corp. | 4,270 | 72 |
*Maxtor Corp. | 12,745 | 71 |
Imation Corp. | 1,925 | 66 |
Electronics (0.3%) | ||
*Flextronics International Ltd. | 29,728 | 397 |
*Amphenol Corp. | 4,654 | 186 |
*Sanmina-SCI Corp. | 27,231 | 151 |
*Avid Technology, Inc. | 1,744 | 117 |
*FLIR Systems, Inc. | 3,564 | 111 |
*Semtech Corp. | 3,875 | 76 |
Electronics--Semiconductors/Components (4) | ||
Intel Corp. | 339,900 | 8,151 |
Texas Instruments, Inc. | 91,707 | 2,427 |
Analog Devices, Inc. | 19,829 | 728 |
Linear Technology Corp. | 16,405 | 641 |
Xilinx, Inc. | 18,375 | 555 |
Broadcom Corp. | 13,892 | 448 |
Altera Corp. | 19,755 | 410 |
*Micron Technology, Inc. | 32,524 | 374 |
*Marvell Technology Group Ltd. | 10,054 | 368 |
Advanced Micro Devices, Inc. | 18,761 | 327 |
Microchip Technology, Inc. | 10,900 | 299 |
*Jabil Circuit, Inc. | 8,734 | 225 |
*Arrow Electronics, Inc. | 6,007 | 162 |
LSI Logic Corp. | 20,395 | 130 |
Intersil Corp. | 7,389 | 125 |
16
Calvert Social Index Fund | Shares | Market Value^ (000) | ||
---|---|---|---|---|
*Avnet, Inc. | 6,333 | $123 | ||
Fairchild Semiconductor | ||||
International, Inc. | 6,354 | 105 | ||
PMC Sierra Inc. | 9,273 | 92 | ||
*Integrated Circuit Systems, Inc. | 3,800 | 77 | ||
Silicon Laboratories Inc. | 2,104 | 74 | ||
Atmel Corp. | 23,292 | 73 | ||
*Integrated Device Technology Inc. | 5,500 | 69 | ||
*Skyworks Solutions, Inc. | 7,962 | 58 | ||
Applied Micro Circuits Corp. | 15,846 | 55 | ||
Agere Systems Inc. Class B | 33,058 | 54 | ||
*RF Micro Devices, Inc. | 9,672 | 53 | ||
Conexant Systems, Inc. | 23,529 | 42 | ||
Vitesse Semiconductor Corp. | 11,488 | 35 | ||
*Agere Systems Inc. Class A | 13,764 | 23 | ||
Electronics--Technology (0.1%) | ||||
*Solectron Corp. | 50,955 | 252 | ||
*Trimble Navigation Ltd. | 2,721 | 98 | ||
Scientific Equipment & Supplies (0.1%) | ||||
Applera Corp.-Applied | ||||
Biosystems Group | 10,745 | 221 | ||
*Varian, Inc. | 1,800 | 77 | ||
73,159 | ||||
Utilities (4.6%) | ||||
SBC Communications Inc. | 175,384 | 4,218 | ||
BellSouth Corp. | 96,993 | 2,502 | ||
*Nextel Communications, Inc. | 57,066 | 1,679 | ||
*Comcast Corp. Special Class A | 36,063 | 1,149 | ||
*Comcast Corp. Class A | 30,464 | 992 | ||
ALLTEL Corp. | 16,294 | 932 | ||
Kinder Morgan, Inc. | 5,160 | 414 | ||
KeySpan Corp. | 8,458 | 335 | ||
NiSource, Inc. | 14,023 | 317 | ||
Cablevision Systems NY Group | ||||
Class A | 9,874 | 307 | ||
NTL Inc. | 3,688 | 239 | ||
Questar Corp. | 4,475 | 237 | ||
Telephone & Data Systems, Inc. | 2,674 | 234 | ||
CenturyTel, Inc. | 6,688 | 225 | ||
Citizens Communications Co. | 15,288 | 204 | ||
*NII Holdings Inc. | 3,153 | 180 | ||
*UnitedGlobalCom Inc. Class A | 19,349 | 180 | ||
*Western Wireless Corp. Class A | 4,072 | 160 | ||
MDU Resources Group, Inc. | 5,729 | 155 | ||
ONEOK, Inc. | 5,151 | 151 | ||
AGL Resources Inc. | 3,700 | 128 | ||
Aqua America, Inc. | 5,034 | 124 | ||
OGE Energy Corp. | 4,723 | 123 | ||
Puget Energy, Inc. | 5,313 | 122 | ||
Hawaiian Electric Industries Inc. | 4,292 | 114 | ||
Energen Corp. | 1,733 | 112 | ||
Atmos Energy Corp. | 3,982 | 110 | ||
Piedmont Natural Gas, Inc. | 3,800 | 89 | ||
NICOR Inc. | 2,363 | 88 | ||
Peoples Energy Corp. | 2,000 | 86 | ||
WGL Holdings Inc. | 2,600 | 80 | ||
Duquesne Light Holdings, Inc. | 4,110 | 77 | ||
*Cincinnati Bell Inc. | 12,677 | 56 | ||
16,119 | ||||
Other (1.0%) | ||||
3M Co. | 38,058 | 3,195 | ||
Carlisle Co., Inc. | 1,633 | 114 | ||
Teleflex Inc. | 1,922 | 97 | ||
Lancaster Colony Corp. | 1,500 | 64 | ||
3,470 | ||||
TOTAL COMMON STOCKS | ||||
(Cost $332,617) | 349,627 | |||
TEMPORARY CASH INVESTMENTS (0.6%) | ||||
Vanguard Market | ||||
Liquidity Fund, | ||||
2.540%** | 1,553,581 | 1,554 | ||
Vanguard Market | ||||
Liquidity Fund, | ||||
2.540%**--Note E | 445,900 | 446 | ||
TOTAL TEMPORARY CASH INVESTMENTS | ||||
(Cost $2,000) | 2,000 | |||
TOTAL INVESTMENTS (100.4%) | ||||
(Cost $334,617) | 351,627 | |||
OTHER ASSETS AND LIABILITIES (-0.4%) | ||||
Other Assets--Note B | 1,928 | |||
Liabilities--Note E | (3,360) | |||
(1,432) | ||||
NET ASSETS (100%) | $350,195 | |||
^See Note A in Notes to Financial Statements. *Non-income-producing security. **Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. REIT—Real Estate Invesment Trust. |
17
Calvert Social Index Fund | Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $350,523 |
Undistributed Net Investment Income | 132 |
Accumulated Net Realized Losses | (17,470) |
Unrealized Appreciation | 17,010 |
NET ASSETS | $350,195 |
Investor Shares--Net Assets | |
Applicable to 43,321,785 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $336,787 |
NET ASSET VALUE PER SHARE-- | |
INVESTOR SHARES | $7.77 |
Institutional Shares--Net Assets | |
Applicable to 1,722,997 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $13,408 |
NET ASSET VALUE PER SHARE-- | |
INSTITUTIONAL SHARES | $7.78 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
18
STATEMENT OF OPERATIONS
This Statement shows the types of income earned by the fund during the reporting period, and details the operating expenses charged to each class of its shares. These expenses directly reduce the amount of investment income available to pay to shareholders as income dividends. This Statement also shows any Net Gain (Loss) realized on the sale of investments, and the increase or decrease in the Unrealized Appreciation (Depreciation) of investments during the period.
Calvert Social Index Fund Six Months Ended February 28, 2005 (000) | |
---|---|
INVESTMENT INCOME | |
Income | |
Dividends | $3,845 |
Interest | 6 |
Security Lending | 8 |
Total Income | 3,859 |
Expenses | |
The Vanguard Group--Note B | |
Investment Advisory Services | 50 |
Management and Administrative | |
Investor Shares | 267 |
Institutional Shares | 3 |
Marketing and Distribution | |
Investor Shares | 27 |
Institutional Shares | 1 |
Custodian Fees | 28 |
Shareholders' Reports | |
Investor Shares | 10 |
Institutional Shares | -- |
Total Expenses | 386 |
NET INVESTMENT INCOME | 3,473 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | (4,616) |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | 21,013 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $19,870 |
19
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how the fund’s total net assets changed during the two most recent reporting periods. The Operations section summarizes information detailed in the Statement of Operations. The amounts shown as Distributions to shareholders from the fund’s net income and capital gains may not match the amounts shown in the Operations section, because distributions are determined on a tax basis and may be made in a period different from the one in which the income was earned or the gains were realized on the financial statements. The Capital Share Transactions section shows the net amount shareholders invested in or redeemed from the fund. Distributions and Capital Share Transactions are shown separately for each class of shares.
Calvert Social Index Fund | ||
---|---|---|
Six Months Ended Feb. 28, 2005 (000) | Year Ended Aug. 31, 2004 (000) | |
INCREASE (DECREASE) IN NET ASSETS | ||
Operations | ||
Net Investment Income | $3,473 | $2,779 |
Realized Net Gain (Loss) | (4,616) | (930) |
Change in Unrealized Appreciation (Depreciation) | 21,013 | 11,550 |
Net Increase (Decrease) in Net Assets Resulting from Operations | 19,870 | 13,399 |
Distributions | ||
Net Investment Income | ||
Investor Shares | (4,823) | (1,815) |
Institutional Shares | (221) | (130) |
Realized Capital Gain | ||
Investor Shares | -- | -- |
Institutional Shares | -- | -- |
Total Distributions | (5,044) | (1,945) |
Capital Share Transactions--Note F | ||
Investor Shares | 48,864 | 113,046 |
Institutional Shares | (386) | 465 |
Net Increase (Decrease) from Capital Share Transactions | 48,478 | 113,511 |
Total Increase (Decrease) | 63,304 | 124,965 |
Net Assets | ||
Beginning of Period | 286,891 | 161,926 |
End of Period | $350,195 | $286,891 |
20
FINANCIAL HIGHLIGHTS
This table summarizes the fund’s investment results and distributions to shareholders on a per-share basis for each class of shares. It also presents the Total Return and shows net investment income and expenses as percentages of average net assets. These data will help you assess: the variability of the fund’s net income and total returns from year to year; the relative contributions of net income and capital gains to the fund’s total return; how much it costs to operate the fund; and the extent to which the fund tends to distribute capital gains. The table also shows the Portfolio Turnover Rate, a measure of trading
Calvert Social Index Fund Investor Shares | ||||||
Six Months Ended Feb. 28, | Year Ended August 31, | May 8* to Aug. 31, | ||||
---|---|---|---|---|---|---|
For a Share Outstanding Throughout Each Period | 2005 | 2004 | 2003 | 2002 | 2001 | 2000 |
Net Asset Value, Beginning of Period | $7.40 | $6.87 | $6.02 | $7.57 | $11.14 | $10.00 |
Investment Operations | ||||||
Net Investment Income | .08** | .08 | .07 | .05 | .04 | .02 |
Net Realized and Unrealized Gain (Loss) on Investments | .41 | .52 | .84 | (1.55) | (3.57) | 1.12 |
Total from Investment Operations | .49 | .60 | .91 | (1.50) | (3.53) | 1.14 |
Distributions | ||||||
Dividends from Net Investment Income | (.12) | (.07) | (.06) | (.05) | (.03) | -- |
Distributions from Realized Capital Gains | -- | -- | -- | -- | (.01) | -- |
Total Distributions | (.12) | (.07) | (.06) | (.05) | (.04) | -- |
Net Asset Value, End of Period | $7.77 | $7.40 | $6.87 | $6.02 | $7.57 | $11.14 |
Total Return† | 6.60% | 8.75% | 15.28% | -19.96% | -31.75% | 11.07% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $337 | $274 | $150 | $94 | $80 | $40 |
Ratio of Total Expenses to Average Net Assets | 0.25%†† | 0.25% | 0.25% | 0.25% | 0.25% | 0.25%†† |
Ratio of Net Investment Income | ||||||
to Average Net Assets | 1.69%**†† | 1.17% | 1.18% | 0.82% | 0.70% | 0.98%†† |
Portfolio Turnover Rate | 12%†† | 8% | 14% | 18% | 10% | 3% |
*Subscription period for the fund was May 8, 2000, to May 31, 2000, during which time all assets were held in money market instruments. Performance measurement begins May 31, 2000. **Net investment income per share and the ratio of net investment income to average net assets include $0.04 and 0.46%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. † Total returns do not reflect the $10 annual account maintenance fee applied on balances under $10,000. †† Annualized. |
21
FINANCIAL HIGHLIGHTS (CONTINUED)
Calvert Social Index Fund Institutional Shares | |||
Six Months Ended Feb. 28, 2005 | Year Ended Aug. 31, 2004 | Jan. 14* to Aug. 31, 2003 | |
---|---|---|---|
For a Share Outstanding Throughout Each Period | |||
Net Asset Value, Beginning of Period | $7.41 | $6.88 | $6.22 |
Investment Operations | |||
Net Investment Income | .084** | .084 | .05 |
Net Realized and Unrealized Gain (Loss) on Investments | .414 | .522 | .61 |
Total from Investment Operations | .498 | .606 | .66 |
Distributions | |||
Dividends from Net Investment Income | (.128) | (.076) | -- |
Distributions from Realized Capital Gains | -- | -- | -- |
Total Distributions | (.128) | (.076) | -- |
Net Asset Value, End of Period | $7.78 | $7.41 | $6.88 |
Total Return | 6.69% | 8.83% | 10.61% |
Ratios/Supplemental Data | |||
Net Assets, End of Period (Millions) | $13 | $13 | $12 |
Ratio of Total Expenses to Average Net Assets | 0.12%+ | 0.12% | 0.12%+ |
Ratio of Net Investment Income to Average Net Assets | 1.83%**† | 1.30% | 1.32%† |
Portfolio Turnover Rate | 12%† | 8% | 14% |
*Inception. **Net investment income per share and the ratio of net investment income to average net assets include $0.04 and 0.46%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. † Annualized. |
SEE ACCOMPANYING NOTES, WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
22
NOTES TO FINANCIAL STATEMENTS
Vanguard Calvert Social Index Fund is registered under the Investment Company Act of 1940 as an open-end investment company, or mutual fund. The fund offers two classes of shares, Investor Shares and Institutional Shares. Investor Shares are available to any investor who meets the fund’s minimum purchase requirements. Institutional Shares are designed for investors who meet certain administrative and servicing criteria and invest a minimum of $10 million.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S. mutual funds. The fund consistently follows such policies in preparing its financial statements.
1. Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been materially affected by events occurring before the fund’s pricing time but after the close of the securities’ primary markets, are valued by methods deemed by the board of trustees to represent fair value. Investments in Vanguard Market Liquidity Fund are valued at that fund’s net asset value. Temporary cash investments acquired over 60 days to maturity are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services.
Other temporary cash investments are valued at amortized cost, which approximates market value.
2. Federal Income Taxes: The fund intends to continue to qualify as a regulated investment company and distribute all of its taxable income. Accordingly, no provision for federal income taxes is required in the financial statements.
3. Distributions: Distributions to shareholders are recorded on the ex-dividend date.
4. Security Lending: The fund may lend its securities to qualified institutional borrowers to earn additional income. Security loans are required to be secured at all times by collateral at least equal to the market value of securities loaned. The fund invests cash collateral received in Vanguard Market Liquidity Fund, and records a liability for the return of the collateral, during the period the securities are on loan. Security lending income represents the income earned on investing cash collateral, less expenses associated with the loan.
5. Other: Dividend income is recorded on the ex-dividend date. Interest income includes income distributions received from Vanguard Market Liquidity Fund and is accrued daily. Security transactions are accounted for on the date securities are bought or sold. Costs used to determine realized gains (losses) on the sale of investment securities are those of the specific securities sold.
Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees.Income, other non-class-specific expenses, and gains and losses on investments are allocated to each class of shares based on its relative net assets.
B. The Vanguard Group furnishes at cost investment advisory, corporate management, administrative, marketing, and distribution services. The costs of such services are allocated to the fund under methods approved by the board of trustees. The fund has committed to provide up to 0.40% of its net assets in capital contributions to Vanguard. At February 28, 2005, the fund had contributed capital of $46,000 to Vanguard (included in Other Assets), representing 0.01% of the fund’s net assets and 0.05% of Vanguard’s capitalization. The fund’s trustees and officers are also directors and officers of Vanguard.
23
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
C. Distributions are determined on a tax basis and may differ from net investment income and realized capital gains for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain, or loss are recognized in different periods for financial statement and tax purposes; these differences will reverse at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.
The fund’s tax-basis capital gains and losses are determined only at the end of each fiscal year. For tax purposes, at August 31, 2004, the fund had available realized losses of $12,834,000 to offset future net capital gains of $57,000 through August 31, 2009, $3,511,000 through August 31, 2010, $5,505,000 through August 31, 2011, $3,200,000 through August 31, 2012, and $561,000 through August 31, 2013. The fund will use these capital losses to offset net taxable capital gains, if any, realized during the year ending August 31, 2005; should the fund realize net capital losses for the year, the losses will be added to the loss carryforward balances above.
At February 28, 2005, net unrealized appreciation of investment securities for tax purposes was $17,010,000, consisting of unrealized gains of $45,572,000 on securities that had risen in value since their purchase and $28,562,000 in unrealized losses on securities that had fallen in value since their purchase.
D. During the six months ended February 28, 2005, the fund purchased $65,802,000 of investment securities and sold $19,516,000 of investment securities other than temporary cash investments.
E. The market value of securities on loan to broker/dealers at February 28, 2005, was $377,000, for which the fund received cash collateral of $446,000.
F. Capital share transactions for each class of shares were:
Six Months Ended February 28, 2005 | Year Ended August 31, 2004 | |||
---|---|---|---|---|
Amount (000) | Shares (000) | Amount (000) | Shares (000) | |
Investor Shares | ||||
Issued | $73,946 | 9,573 | $139,192 | 18,638 |
Issued in Lieu of Cash Distributions | 4,403 | 558 | 1,660 | 228 |
Redeemed | (29,485) | (3,800) | (27,806) | (3,727) |
Net Increase (Decrease)--Investor Shares | 48,864 | 6,331 | 113,046 | 15,139 |
Institutional Shares | ||||
Issued | 951 | 124 | 2,929 | 390 |
Issued in Lieu of Cash Distributions | 221 | 28 | 130 | 18 |
Redeemed | (1,558) | (202) | (2,594) | (348) |
Net Increase (Decrease)--Institutional Shares | (386) | (50) | 465 | 60 |
24
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25
INVEST WITH VANGUARD FOR YOUR RETIREMENT
Vanguard offers low-cost, high-quality solutions that combine a variety of investment choices to help you achieve your retirement goals.
A Vanguard traditional IRA enables you to make deductible or nondeductible contributions that can grow tax-deferred until you take distributions in retirement, while a Vanguard Roth IRA allows you to make nondeductible contributions with tax-free withdrawals when you take qualified distributions.
With either type of Vanguard IRA®, your investment options include:
•Vanguard mutual funds
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• Vanguard Target Retirement Funds
Choose a single, all-in-one portfolio that is professionally managed and well diversified. It automatically shifts from a more aggressive to a more conservative asset allocation as your target retirement date approaches, so you can leave the time-consuming details of portfolio management to Vanguard.
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When you change jobs or retire, you can take greater control of your investments by rolling over your assets in an employer-sponsored retirement plan to a Vanguard IRA. To initiate a rollover, visit Vanguard.com, where you can complete our easy online application. You can also print out the application and mail it to us—or call a Vanguard retirement specialist at 800-205-6189.
For more information, visit www.vanguard.com, or call 800-662-7447 for Vanguard funds and 800-992-8327 for non-Vanguard funds offered through Vanguard Brokerage Services, to obtain a prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.
MAXIMIZE YOUR RETIREMENT INVESTMENTS
Are you taking full advantage of your IRA? You should be. With increased contribution limits, these tax-advantaged accounts are powerful options for retirement savers. To take full advantage of your retirement account, consider these simple, but important, steps:
• Contribute the maximum amount each year.
If you invest as much in your IRA as the law allows—$3,000 for 2004 and $4,000 for 2005 if you are under the age of 50, and $3,500 and $4,500, respectively, if you are aged 50 or older—you will increase your chances of meeting your retirement goals. Provided you meet the eligibility requirements, max out your contribution every year you can.
• Make automatic contributions.
You can make regular contributions to your IRA by taking advantage of Vanguard’s Automatic Investment Plan, which deducts your contributions from your bank account on a schedule you select—making retirement investing a healthy habit.
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Unless you’ve invested in a Vanguard Target Retirement Fund, you should rebalance your account periodically to ensure that your target asset allocations are aligned to meet your retirement objectives.
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You determine who will receive your retirement assets after your death, so it’s important to keep your beneficiary designations up to date. They will generally override any other instructions—even those in your will.
• Adopt a long-term approach.
A successful investment strategy requires a long-term perspective and staying on course—even when the financial markets are declining. Market-timing and performance-chasing are losing strategies that can cause you to stray from the path to your retirement goals.
If you have any questions about IRAs or would like to talk to a Vanguard retirement specialist, call 800-205-6189.
THE PEOPLE WHO GOVERN YOUR FUND
The trustees of your mutual fund are there to see that the fund is operated and managed in your best interests since, as a shareholder, you are a part owner of the fund. Your fund trustees also serve on the board of directors of The Vanguard Group, Inc., which is owned by the Vanguard funds and provides services to them on an at-cost basis. | |
A majority of Vanguard's board members are independent, meaning that they have no affiliation with Vanguard or the funds they oversee, apart from the sizable personal investments they have made as private individuals. | |
Our independent board members bring distinguished backgrounds in business, academia, and public service to their task of working with Vanguard officers to establish the policies and oversee the activities of the funds. Among board members’ responsibilities are | |
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
John J. Brennan* (1954) May 1987 | Chairman of the Board, Chief Executive Officer, and Trustee (132) | Chairman of the Board,Chief Executive Officer, and Director/Trustee of The Vanguard Group, Inc., and of each of the investment companies served by The Vanguard Group. |
INDEPENDENT TRUSTEES | ||
Charles D. Ellis (1937) January 2001 | Trustee (132) | The Partners of `63 (pro bono ventures in education); Senior Advisor to Greenwich Associates (international business strategy consulting); Successor Trustee of Yale University; Overseer of the Stern School of Business at New York University; Trustee of the Whitehead Institute for Biomedical Research. |
Rajiv L. Gupta (1945) December 2001** | Trustee (132) | Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Board Member of the American Chemistry Council; Trustee of Drexel University and of the Chemical Heritage Foundation. |
JoAnn Heffernan Heisen (1950) July 1998 | Trustee (132) | Vice President, Chief Information Officer, and Member of the Executive Committee of Johnson & Johnson (pharmaceuticals/ consumer products); Director of the University Medical Center at Princeton and Women's Research and Education Institute. |
Burton G. Malkiel (1932) May 1977 | Trustee (129) | Chemical Bank Chairman's Professor of Economics, Princeton University; Director of Vanguard Investment Series plc (Irish invest- ment fund) (since November 2001), Vanguard Group (Ireland) Limited (investment management) (since November 2001), BKF Capital (investment management), The Jeffrey Co. (holding company), and CareGain, Inc. (health care management). |
André F. Perold (1952) December 2004 | Trustee (132) | George Gund Professor of Finance and Banking, Harvard Business School (since 2000); Senior Associate Dean, Director of Faculty Recruiting, and Chair of Finance Faculty, Harvard Business School; Director and Chairman of UNX, Inc. (equities trading firm) (since 2003); Director of registered investment companies advised by Merrill Lynch Investment Managers and affiliates (1985–2004), Genbel Securities Limited (South African financial services firm) (1999–2003), Gensec Bank (1999–2003), Sanlam Investment Management (1999–2001), Sanlam, Ltd. (South African insurance company) (2001–2003), Stockback, Inc. (credit card firm) (2000–2002), and Bulldogresearch.com (investment research) (1999–2001); and Trustee of Commonfund (investment management) (1989–2001). |
selecting investment advisors for the funds; monitoring fund operations, performance, and costs; reviewing contracts; nominating and selecting new trustees/directors; and electing Vanguard officers. | |
Each trustee serves a fund until its termination; or until the trustee’s retirement, resignation, or death; or otherwise as specified in the fund’s organizational documents. Any trustee may be removed at a shareholders’ meeting by a vote representing two-thirds of the net asset value of all shares of the fund together with shares of other Vanguard funds organized within the same trust. The table on these two pages shows information for each trustee and executive officer of the fund. The mailing address of the trustees and officers is P.O. Box 876, Valley Forge, PA 19482. |
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
---|---|---|
Alfred M. Rankin, Jr. (1941) January 1993 | Trustee (132) | Chairman, President, Chief Executive Officer, and Director of NACCO Industries, Inc. (forklift trucks/housewares/lignite); Director of Goodrich Corporation (industrial products/aircraft systems and services); Director of Standard Products Company (supplier for the automotive industry) until 1998. |
J. Lawrence Wilson (1936) April 1985 | Trustee (132) | Retired Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Director of Cummins Inc. (diesel engines), MeadWestvaco Corp. (packaging products), and AmerisourceBergen Corp. (pharmaceutical distribution); Trustee of Vanderbilt University and of Culver Educational Foundation. |
EXECUTIVE OFFICERS* | ||
R. Gregory Barton (1951) June 2001 | Secretary (132) | Managing Director and General Counsel of The Vanguard Group, Inc.; Secretary of The Vanguard Group, Inc. and of each of the investment companies served by The Vanguard Group since June 2001. |
Thomas J. Higgins (1957) July 1998 | Treasurer (132) | Principal of The Vanguard Group, Inc.; Treasurer of each of the investment companies served by The Vanguard Group. |
*Officers of the funds are “interested persons” as defined in the Investment Company Act of 1940. | ||
**December 2002 for Vanguard Equity Income Fund, Vanguard Growth Equity Fund, the Vanguard Municipal Bond Funds, and the Vanguard State Tax-Exempt Funds. | ||
More information about the trustees is in the Statement of Additional Information, available from The Vanguard Group. |
VANGUARD SENIOR MANAGEMENT TEAM | |
---|---|
Mortimer J. Buckley, Information Technology. James H. Gately, Investment Programs and Services. Kathleen C. Gubanich, Human Resources. F. William McNabb, III, Client Relationship Group. | Michael S. Miller, Planning and Development. Ralph K. Packard, Finance. George U. Sauter, Chief Investment Officer. |
John C. Bogle, Founder; Chairman and Chief Executive Officer, 1974-1996. | |
Post Office Box 2600
Valley Forge, PA 19482-2600
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All comparative mutual fund data are from Lipper Inc. or Morningstar, Inc., unless otherwise noted.
For More Information
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You can review and copy information about your fund at the SEC’s Public Reference Room in Washington, D.C. To find out more about this public service, call the SEC at 202-942- 8090. Information about your fund is also available on the SEC’s website, and you can receive copies of this information, for a fee, by sending a request in either of two ways: via e-mail addressed to publicinfo@sec.gov or via regular mail addressed to the Public Reference Section, Securities and Exchange Commission, Washington, DC 20549–0102.
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© 2005 The Vanguard Group, Inc.
All rights reserved.
Vanguard Marketing
Corporation, Distributor.
Q2132 042005
Vanguard® U.S. Sector Index Funds | ||
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February 28, 2005 |
![](https://capedge.com/proxy/N-CSRS/0000932471-05-000784/ussectorcover.gif)
CONTENTS | |
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1 | CHAIRMAN'S LETTER |
7 | FUND PROFILES |
12 | GLOSSARY OF INVESTMENT TERMS |
13 | PERFORMANCE SUMMARIES |
17 | ABOUT YOUR FUNDS' EXPENSES |
18 | FINANCIAL STATEMENTS |
62 | ADVANTAGES OF VANGUARD.COM |
SUMMARY | |
• | During the past six months, Vanguard broadened its lineup of U.S. Sector Index Funds. |
• | The energy sector produced the best six-month return, and the health care sector the worst, which was reflected in the returns of our funds. |
• | The broad U.S. stock market returned more than 11%, a strong six-month advance. |
VANGUARD’S PLEDGE TO CLIENTS | ||||
We recognize that your relationship with Vanguard rests on the twin pillars of trust and excellence, each of which is built upon the character of our people. Our Pledge to Clients reflects our ongoing efforts to deserve your trust and to continually improve so that we can offer you excellence in all that we do. | ||||
We will: | ||||
• | Put your interests first at all times. | |||
• | Continually seek to earn your trust by adhering to the highest standards of ethical behavior and fiduciary responsibility. | |||
• | Strive to be the highest-value provider of investment services, which means outstanding investment performance and service, both at the lowest possible cost. | |||
• | Communicate candidly not only about the rewards of investing but also about the risks and costs. | |||
• | Maintain highly effective controls to safeguard your assets and protect your confidential information. | |||
• | Invest a majority of our personal assets alongside yours. | |||
| ||||
Please note: The opinions expressed in this report are just that-informed opinions. They should not be considered promises or advice. Also, please keep in mind that the information and opinions cover the period through the date on the cover of this report. Of course, the risks of investing in your fund are spelled out in the prospectus. | ||||
| ||||
Want less clutter in your mailbox? Just register with Vanguard.com® and opt to get fund reports online. | ![]() |
CHAIRMAN'S LETTER | |
Dear Shareholder,
A year ago, we prepared Vanguard’s first report on the nascent Vanguard U.S. Sector Index Funds. At the time, we offered seven funds, each featuring both Admiral Shares and exchange-traded VIPER Shares. Our lineup has expanded, and this year I am pleased to present our second semiannual report, this one covering ten sector funds.
The additions increase the options for investors seeking a low-cost tool to help meet complex investment and risk-control strategies, such as increasing exposure to an underrepresented sector in a portfolio that has become unbalanced for any number of reasons.
The table below shows the total returns for seven funds’ Admiral Shares. It also shows the returns of the broad U.S. stock market, as measured by the Morgan Stanley Capital International US Investable Market 2500 (MSCI US IMI/2500) Index, and the respective target indexes, which are subsets of the broad index. The table on the next page does the same for our funds’ exchange-traded VIPER Shares.
Total Returns: Admiral Shares* | |
---|---|
| Six Months Ended February 28, 2005 |
Vanguard Consumer Staples Index Fund | 8.1% |
MSCI US IMI/Consumer Staples | 7.7 |
Vanguard Energy Index Fund | 22.4%** |
MSCI US IMI/Energy | 22.8** |
MSCI US IMI/2500 | 8.0** |
Vanguard Financials Index Fund | 5.1% |
MSCI US IMI/Financials | 5.2 |
Vanguard Health Care Index Fund | 4.6% |
MSCI US IMI/Health Care | 4.8 |
Vanguard Information Technology Index Fund | 11.4% |
MSCI US IMI/Information Technology | 11.5 |
Vanguard Materials Index Fund | 20.4% |
MSCI US IMI/Materials | 20.5 |
Vanguard Utilities Index Fund | 16.9% |
MSCI US IMI/Utilities | 17.1 |
MSCI US IMI/2500 | 11.3% |
*Returns do not reflect the 2% fee on sales of shares held for less than one year. Three of the U.S. Sector Index Funds had not issued Admiral Shares as of February 28, 2005. | |
**Return since inception on October 7, 2004. |
STOCKS SURGED AFTER THE NOVEMBER ELECTION
During the past six months, stock investors tried to digest and act on conflicting information: generally positive economic indicators but relatively weak job growth; surging commodity prices but modest inflation for most other goods and services; and a falling U.S. dollar that was either a boon or a bane to the economy, depending on the pundit. Nevertheless, in the aggregate, stock prices rose, particularly after it was clear that November’s presidential election was not going to reprise the protracted 2000 contest. The Dow Jones Wilshire 5000 Composite Index, a proxy for the broad U.S. equity market, posted a solid six-month return of 11.6%.
As they have for the past five years, mid- and small-capitalization stocks outpaced large-caps. Among the latter, value stocks—those whose prices are low relative to company earnings, book value, or other measures—generally outperformed their growth counterparts. Returns were positive across industry sectors, with energy-related stocks notching the highest results, boosted in part by crude oil prices that stayed above $40 a barrel through most of the period, at one point reaching a record peak of nearly $56.
In overseas markets, stock returns were generally superior to those seen in the United States. And the returns abroad were further augmented for U.S.-based investors by the weakness of the U.S. dollar, which reached multiyear lows relative to other major currencies near the end of calendar 2004.
BOND YIELDS ROSE
The Federal Reserve Board continued its gradual shift in monetary policy, moving away from its “accommodative” stance of keeping interest rates very low. During the fiscal half-year, the Fed raised its target for the
1
Admiral™ Shares | |
A low-cost class of shares available to shareholders who make significant investments in the fund. | |
VIPER® Shares | |
Traded on the American Stock Exchange, VIPERs® are available only through brokers. The table on this page shows VIPER returns based on both the AMEX market price and the net asset value for a share. | |
federal funds rate in four quarter-point increments, from 1.50% to 2.50%. Short- and intermediate-term bonds felt the ripples. The yield of the 3-month U.S. Treasury bill, a proxy for money market yields, rose 117 basis points (1.17 percentage points) to 2.75%. The yield of the 10-year Treasury note rose 26 basis points to 4.38%. However, yields of longer-term bonds, which are less sensitive to Fed moves, were lower at the end of the fiscal half-year than at the beginning.
With price declines partly offsetting interest income, the total return of the overall taxable investment-grade bond market (as measured by the Lehman Brothers Aggregate Bond Index) was a modest 1.3%. Below-investment-grade bonds, as measured by the Lehman High Yield Index, returned 7.5%, as investors’ appetite for yield kept the riskier securities’ prices aloft. Municipal bonds generally outpaced their taxable peers even before factoring in their tax advantages.
SIX-MONTH PERFORMANCE WAS STRONG ACROSS SECTORS
The broad market’s six-month gain translated into positive returns in all sectors and double-digit performances in many. The market returns ranged from 4.9% for our Health Care VIPERs to 29.5% for Energy VIPERs. As you may know, our VIPERs combine indexing with the trading flexibility and continual pricing of individual stocks. With one exception, the funds met
Market Barometer | ||||
---|---|---|---|---|
| Total Returns Periods Ended February 28, 2005 | |||
| Six Months | One Year | Five Years* | |
Stocks | Russell 1000 Index (Large-caps) | 10.8% | 7.5% | -0.9% |
Russell 2000 Index (Small-caps) | 16.4 | 9.5 | 3.2 | |
Dow Jones Wilshire 5000 Index | 11.6 | 7.9 | -1.2 | |
(Entire market) | ||||
Bonds | MSCI All Country World Index | |||
ex USA (International) | 22.8 | 20.1 | 1.2 | |
Lehman Aggregate Bond Index | 1.3% | 2.4% | 7.5% | |
(Broad taxable market) | ||||
Lehman Municipal Bond Index | 2.4 | 3.0 | 7.2 | |
Citigroup 3-Month Treasury Bill Index | 0.9 | 1.4 | 2.7 | |
CPI | Consumer Price Index | 1.2% | 3.0% | 2.5% |
*Annualized |
their mandate of providing returns in line with their sector-specific benchmarks. The exception, Telecommunication Services VIPERs, diverged from the benchmark due to Securities and Exchange Commission diversification regulations. The rules required the fund to reduce its holdings in the largest telecom stocks. The smaller stocks into which fund
Total Returns: VIPER Shares | |
---|---|
| Six Months Ended February 28, 2005 |
Vanguard Consumer Discretionary VIPERs | |
Market Price | 13.6% |
Net Asset Value | 13.6 |
MSCI US IMI/Consumer Discretionary | 13.8 |
Vanguard Consumer Staples VIPERs | |
Market Price | 8.3% |
Net Asset Value | 8.2 |
MSCI US IMI/Consumer Staples | 7.7 |
Vanguard Energy VIPERs | |
Market Price | 29.5%* |
Net Asset Value | 29.3* |
MSCI US IMI/Energy | 30.3* |
MSCI US IMI/2500 | 10.3* |
Vanguard Financials VIPERs | |
Market Price | 5.2% |
Net Asset Value | 5.0 |
MSCI US IMI/Financials | 5.2 |
Vanguard Health Care VIPERs | |
Market Price | 4.9% |
Net Asset Value | 4.6 |
MSCI US IMI/Health Care | 4.8 |
Vanguard Industrials VIPERs | |
Market Price | 12.0%* |
Net Asset Value | 11.4* |
MSCI US IMI/Industrials | 11.0* |
MSCI US IMI/2500 | 10.3* |
Vanguard Information Technology VIPERs | |
Market Price | 11.4% |
Net Asset Value | 11.4 |
MSCI US IMI/Information Technology | 11.5 |
Vanguard Materials VIPERs | |
Market Price | 20.5% |
Net Asset Value | 20.4 |
MSCI US IMI/Materials | 20.5 |
Vanguard Telecommunication Services VIPERs | |
Market Price | 7.4%* |
Net Asset Value | 7.4* |
MSCI US IMI/Telecommunication Services | 2.9* |
MSCI US IMI/2500 | 10.3* |
Vanguard Utilities VIPERs | |
Market Price | 17.0% |
Net Asset Value | 16.9 |
MSCI US IMI/Utilities | 17.1 |
MSCI US IMI/2500 | 11.3% |
*Return since VIPERs’ inception on September 23, 2004. |
2
assets were redeployed outperformed during the six months. (The holdings of the Consumer Staples, Energy, and Industrials Index Funds were also adjusted to meet diversification requirements.)
As noted earlier, the energy sector benefited from persistently high oil prices. Other leading sectors included materials, whose prices were pumped up in part by high demand for commodities in China and India, and utilities, which was powered by demand from a strengthening economy. The three sectors also are rich in dividend income, which has been a benefit since the 2003 passage of legislation that granted dividends more favorable tax treatment.
Health care and financials stocks were laggards over the six months, partly because of regulatory issues affecting makers of prescription drugs and insurance companies and the threat of product-liability lawsuits.
THE ROLE OF SECTOR FUNDS IN A PORTFOLIO
The U.S. Sector Index Funds offer investors an opportunity to tweak their portfolios in ways that may be difficult using more diversified funds. Whether you seek a single fund to increase exposure to an underrep-resented sector or are looking for a more sophisticated approach to managing risk exposure, our Sector Index Funds offer a range of options.
Used appropriately, the funds can help you manage risk in your portfolio; used as speculative tools, these funds can significantly increase risk, simply because the timing, direction, and size of any sector move is unknowable. The Vanguard U.S. Sector Index Funds are best used as part of a long-term strategy to diversify across and within asset classes as appropriate for your circumstances.
Thank you for entrusting your assets to us.
Sincerely,
John J. Brennan
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
MARCH 15, 2005
3
Your Fund's Performance at a Glance | August 31, 2004-February 28, 2005 | |||
---|---|---|---|---|
Distributions Per Share | ||||
| Starting Share Price | Ending Share Price | Income Dividends | Capital Gains |
Consumer Discretionary Index Fund | ||||
VIPER Shares | $46.99 | $53.03 | $0.350 | $0.000 |
Consumer Staples Index Fund | ||||
Admiral Shares | $25.82 | $27.35 | $0.440 | $0.119 |
VIPER Shares | 52.28 | 55.43 | 0.853 | 0.241 |
Energy Index Fund | ||||
Admiral Shares | $25.98* | $31.66 | $0.111 | $0.000 |
VIPER Shares | 49.24* | 63.43 | 0.216 | 0.000 |
Financials Index Fund | ||||
Admiral Shares | $25.35 | $26.07 | $0.581 | $0.000 |
VIPER Shares | 50.57 | 52.01 | 1.148 | 0.000 |
Health Care Index Fund | ||||
Admiral Shares | $23.97 | $24.99 | $0.086 | $0.000 |
VIPER Shares | 47.90 | 49.98 | 0.133 | 0.000 |
Industrials Index Fund | ||||
VIPER Shares | $48.79* | $54.03 | $0.320 | $0.000 |
Information Technology Index Fund | ||||
Admiral Shares | $20.72 | $22.78 | $0.323 | $0.000 |
VIPER Shares | 40.46 | 44.51 | 0.609 | 0.000 |
Materials Index Fund | ||||
Admiral Shares | $26.53 | $31.42 | $0.500 | $0.000 |
VIPER Shares | 52.13 | 61.75 | 0.975 | 0.000 |
Telecommunication Services Index Fund | ||||
VIPER Shares | $49.50* | $52.75 | $0.410 | $0.000 |
Utilities Index Fund | ||||
Admiral Shares | $26.70 | $30.40 | $0.785 | $0.000 |
VIPER Shares | 53.14 | 60.53 | 1.546 | 0.000 |
*At inception. Inception dates are: for the Energy Index Fund Admiral Shares, October 7, 2004; for the Energy Index Fund VIPER Shares, the Industrials Index Fund VIPER Shares, and the Telecommunication Services Index Fund VIPER Shares, September 23, 2004. |
NOTICE TO SHAREHOLDERS | |
CHANGE TO DISTRIBUTION SCHEDULE IN TWO FUNDS | |
Vanguard Financials Index Fund and Vanguard Utilities Index Fund recently changed from an annual distribution cycle to a quarterly cycle (March, June, September, and December). The change will not affect the funds’ total returns. |
4
Market prices for VIPER Shares, and for exchange-traded funds in general, can deviate from the net asset value (NAV) of the underlying securities.
Consumer Discretionary Index Fund VIPER Shares | ||||
---|---|---|---|---|
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 129 | 46.74% | 132 | 47.84% |
25-49.9 | 5 | 1.81 | 3 | 1.09 |
50-74.9 | 1 | 0.36 | 2 | 0.72 |
75-100.0 | 0 | 0.00 | 0 | 0.00 |
>100.0 | 2 | 0.72 | 2 | 0.72 |
Total | 137 | 49.63% | 139 | 50.37% |
Consumer Staples Index Fund VIPER Shares | ||||
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 139 | 50.37% | 131 | 47.46% |
25-49.9 | 4 | 1.45 | 2 | 0.72 |
50-74.9 | 0 | 0.00 | 0 | 0.00 |
75-100.0 | 0 | 0.00 | 0 | 0.00 |
>100.0 | 0 | 0.00 | 0 | 0.00 |
Total | 143 | 51.82% | 133 | 48.18% |
Energy Index Fund VIPER Shares | ||||
Premium/Discount: September 23, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 57 | 52.29% | 52 | 47.71% |
25-49.9 | 0 | 0.00 | 0 | 0.00 |
50-74.9 | 0 | 0.00 | 0 | 0.00 |
75-100.0 | 0 | 0.00 | 0 | 0.00 |
>100.0 | 0 | 0.00 | 0 | 0.00 |
Total | 57 | 52.29% | 52 | 47.71% |
The following tables indicate the extent to which the funds’ VIPER Shares have traded at a premium or a discount to NAV since inception.
Financials Index Fund VIPER Shares | ||||
---|---|---|---|---|
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 143 | 51.82% | 121 | 43.84% |
25-49.9 | 3 | 1.09 | 0 | 0.00 |
50-74.9 | 1 | 0.36 | 1 | 0.36 |
75-100.0 | 2 | 0.72 | 1 | 0.36 |
>100.0 | 1 | 0.36 | 3 | 1.09 |
Total | 150 | 54.35% | 126 | 45.65% |
Health Care Index Fund VIPER Shares | ||||
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 166 | 60.14% | 106 | 38.41% |
25-49.9 | 3 | 1.09 | 1 | 0.36 |
50-74.9 | 0 | 0.00 | 0 | 0.00 |
75-100.0 | 0 | 0.00 | 0 | 0.00 |
>100.0 | 0 | 0.00 | 0 | 0.00 |
Total | 169 | 61.23% | 107 | 38.77% |
Industrials Index Fund VIPER Shares | ||||
Premium/Discount: September 23, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 57 | 52.30% | 45 | 41.29% |
25-49.9 | 0 | 0.00 | 2 | 1.83 |
50-74.9 | 0 | 0.00 | 0 | 0.00 |
75-100.0 | 2 | 1.83 | 1 | 0.92 |
>100.0 | 0 | 0.00 | 2 | 1.83 |
Total | 59 | 54.13% | 50 | 45.87% |
*Inception.
**One basis point equals 1/100th of 1%.
5
Information Technology Index Fund VIPER Shares | ||||
---|---|---|---|---|
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 146 | 52.91% | 105 | 38.04% |
25-49.9 | 6 | 2.17 | 4 | 1.45 |
50-74.9 | 1 | 0.36 | 1 | 0.36 |
75-100.0 | 0 | 0.00 | 1 | 0.36 |
>100.0 | 5 | 1.81 | 7 | 2.54 |
Total | 158 | 57.25% | 118 | 42.75% |
Materials Index Fund VIPER Shares | ||||
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 120 | 43.48% | 147 | 53.27% |
25-49.9 | 0 | 0.00 | 0 | 0.00 |
50-74.9 | 1 | 0.36 | 6 | 2.17 |
75-100.0 | 0 | 0.00 | 1 | 0.36 |
>100.0 | 1 | 0.36 | 0 | 0.00 |
Total | 122 | 44.20% | 154 | 55.80% |
Telecommunications Services Index Fund VIPER Shares | ||||
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 42 | 38.54% | 54 | 49.54% |
25-49.9 | 1 | 0.92 | 1 | 0.92 |
50-74.9 | 0 | 0.00 | 1 | 0.92 |
75-100.0 | 2 | 1.83 | 0 | 0.00 |
>100.0 | 2 | 1.83 | 6 | 5.50 |
Total | 47 | 43.12% | 62 | 56.88% |
Utilities Index Fund VIPER Shares | ||||
Premium/Discount: January 26, 2004*-February 28, 2005 | ||||
---|---|---|---|---|
| Closing Price Above or Equal to Closing Net Asset Value | Closing Price Below Closing Net Asset Value | ||
Basis Point Differential** | Number of Days | Percentage of Total Days | Number of Days | Percentage of Total Days |
0-24.9 | 130 | 47.10% | 137 | 49.65% |
25-49.9 | 4 | 1.45 | 2 | 0.72 |
50-74.9 | 0 | 0.00 | 1 | 0.36 |
75-100.0 | 0 | 0.00 | 1 | 0.36 |
>100.0 | 0 | 0.00 | 1 | 0.36 |
Total | 134 | 48.55% | 142 | 51.45% |
*Inception.
**1 basis point equals 1/100th of 1%.
6
FUND PROFILES | |
---|---|
As of 2/28/2005 | These Profiles provide snapshots of each fund's characteristics, compared where indicated with the fund's target index and a broad market index. Key terms are defined on page 12. |
CONSUMER DISCRETIONARY INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 433 | 433 | 2,494 |
Median Market Cap | $15.6B | $15.6B | $29.5B |
Price/Earnings Ratio | 26.7x | 26.6x | 25.6x |
Price/Book Ratio | 3.7x | 3.7x | 4.7x |
Yield—VIPER Shares | 0.6% | 0.8% | 1.7% |
Return on Equity | 13.2% | 13.3% | 17.9% |
Earnings Growth Rate | 14.7% | 14.7% | 12.3% |
Foreign Holdings | 0.1% | 0.1% | 0.2% |
Turnover Rate | 17%† | — | — |
Expense Ratio—VIPER Shares | 0.28%† | — | — |
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Advertising Agencies | 2% |
Auto Parts—Aftermarket | 1 |
Auto Parts—Original Equipment | 1 |
Automobiles | 2 |
Cable Television Services | 2 |
Casinos & Gambling | 3 |
Communications & Media | 5 |
Consumer Products | 1 |
Entertainment | 8 |
Home Building | 4 |
Hotel/Motel | 2 |
Household Equipment & Products | 1 |
Household Furnishings | 1 |
Leisure Time | 2 |
Multi-Sector Companies | 2 |
Photography | 1 |
Publishing—Miscellaneous | 2 |
Publishing—Newspapers | 3 |
Radio & Television Broadcasters | 5 |
Recreational Vehicles & Boats | 2 |
Restaurants | 7 |
Retail | 29 |
Services—Commercial | 4 |
Shoes | 2 |
Textiles Apparel Manufacturing | 2 |
Toys | 1 |
Utilities—Cable Television & Radio | 5 |
Ten Largest Holdings (% of total net assets) | |
Home Depot, Inc. | 5.3% |
Time Warner, Inc. | 4.6 |
Comcast Corp. | 4.1 |
The Walt Disney Co. | 3.4 |
Viacom Inc. | 3.1 |
Lowe's Cos., Inc. | 2.6 |
Target Corp. | 2.6 |
eBay Inc. | 2.6 |
McDonald's Corp. | 2.5 |
Liberty Media Corp. | 1.5 |
Top Ten | 32.3% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Consumer Discretionary. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
CONSUMER STAPLES INDEX FUND | ||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Portfolio Characteristics | ||||||||||||||||||||||||||||||||||||||||||||||
Target | Broad | |||||||||||||||||||||||||||||||||||||||||||||
Fund | Index* | Index** | ||||||||||||||||||||||||||||||||||||||||||||
Number of Stocks | 99 | 98 | 2,494 | |||||||||||||||||||||||||||||||||||||||||||
Median Market Cap | $43.7B | $90.4B | $29.5B | |||||||||||||||||||||||||||||||||||||||||||
Price/Earnings Ratio | 21.4x | 20.9x | 25.6x | |||||||||||||||||||||||||||||||||||||||||||
Price/Book Ratio | 14.8x | 14.1x | 4.7x | |||||||||||||||||||||||||||||||||||||||||||
Yield | 2.0% | 1.7% | ||||||||||||||||||||||||||||||||||||||||||||
Admiral Shares | 1.7% | |||||||||||||||||||||||||||||||||||||||||||||
VIPER Shares | 1.7% | |||||||||||||||||||||||||||||||||||||||||||||
Return on Equity | 30.1% | 30.9% | 17.9% | |||||||||||||||||||||||||||||||||||||||||||
Earnings Growth Rate | 10.6% | 10.6% | 12.3% | |||||||||||||||||||||||||||||||||||||||||||
Foreign Holdings | 0.6% | 0.6% | 0.2% | |||||||||||||||||||||||||||||||||||||||||||
Turnover Rate | 16%† | — | — | |||||||||||||||||||||||||||||||||||||||||||
Expense Ratio | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Admiral Shares | 0.28%† | |||||||||||||||||||||||||||||||||||||||||||||
VIPER Shares | 0.27%† | |||||||||||||||||||||||||||||||||||||||||||||
Short-Term Reserves | 0% | — | — | |||||||||||||||||||||||||||||||||||||||||||
Industry Diversification (% of portfolio) | |
---|---|
Agriculture—Fish & Ranch | 1% |
Beverage—Brewers & Wineries | 5 |
Beverage—Soft Drinks | 15 |
Consumer Products | 8 |
Cosmetics | 3 |
Drug & Grocery Store Chains | 11 |
Foods | 16 |
Milling—Fruit & Grain Producers | 1 |
Retail | 13 |
Soap & Household Chemicals | 14 |
Tobacco | 13 |
Ten Largest Holdings (% of total net assets) | |
Altria Group, Inc. | 10.7% |
Wal-Mart Stores, Inc. | 10.3 |
The Procter & Gamble Co. | 10.1 |
The Coca-Cola Co. | 7.0 |
PepsiCo, Inc. | 6.8 |
Gillette Co. | 4.2 |
Walgreen Co. | 3.9 |
Anheuser-Busch Cos., Inc. | 3.3 |
Kimberly-Clark Corp. | 2.9 |
Colgate-Palmolive Co. | 2.5 |
Top Ten | 61.7% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Consumer Staples. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
Visit our website at Vanguard.com
for regularly updated fund information.
7
FUND PROFILES (CONTINUED) | |||
---|---|---|---|
ENERGY INDEX FUND | |||
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 122 | 122 | 2,494 |
Median Market Cap | $27.9B | $77.0B | $29.5B |
Price/Earnings Ratio | 24.1x | 23.1x | 25.6x |
Price/Book Ratio | 3.3x | 3.5x | 4.7x |
Yield | 1.4% | 1.7% | |
Admiral Shares | 1.1% | ||
VIPER Shares | 1.1% | ||
Return on Equity | 21.2% | 22.2% | 17.9% |
Earnings Growth Rate | 11.1% | 10.3% | 12.3% |
Foreign Holdings | 0.6% | 0.6% | 0.2% |
Turnover Rate | 10%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28%† | ||
VIPER Shares | 0.28%† | ||
Short-Term Reserves | 1% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Energy Miscellaneous | 3% |
Machinery—Oil Well Equipment & Service | 17 |
Offshore Drilling | 3 |
Oil—Crude Producers | 19 |
Oils—Integrated Domestic | 14 |
Oils—Integrated International | 38 |
Shipping | 1 |
Utilities—Gas Distribution | 2 |
Utilities—Gas Pipelines | 2 |
Short-Term Reserves | 1% |
Ten Largest Holdings (% of total net assets) | |
ExxonMobil Corp. | 20.2% |
ChevronTexaco Corp. | 15.1 |
ConocoPhillips Co. | 9.8 |
Schlumberger Ltd. | 3.9 |
Occidental Petroleum Corp. | 2.5 |
Devon Energy Corp. | 1.9 |
Apache Corp. | 1.8 |
Burlington Resources, Inc. | 1.8 |
Halliburton Co. | 1.8 |
Anadarko Petroleum Corp. | 1.7 |
Top Ten | 60.5% |
"Ten Largest Holdings" excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Energy. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
FINANCIALS INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 533 | 533 | 2,494 |
Median Market Cap | $30.2B | $30.2B | $29.5B |
Price/Earnings Ratio | 18.5x | 18.5x | 25.6x |
Price/Book Ratio | 2.5x | 2.5x | 4.7x |
Yield | 2.7% | 1.7% | |
Admiral Shares | 2.4% | ||
VIPER Shares | 2.4% | ||
Return on Equity | 15.5% | 15.5% | 17.9% |
Earnings Growth Rate | 11.1% | 11.1% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 7%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28%† | ||
VIPER Shares | 0.27%† | ||
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Banks-New York City | 6% |
Banks-Outside New York City | 29 |
Diversified Financial Services | 19 |
Finance Companies | 1 |
Financial-Small Loan | 1 |
Financial-Miscellaneous | 7 |
Insurance-Life | 2 |
Insurance-Multiline | 12 |
Insurance-Property-Casualty | 4 |
Investment Management Companies | 1 |
Multi-Sector Companies | 1 |
Real Estate Investment Trusts | 9 |
Savings & Loan | 4 |
Securities Brokers & Services | 4 |
Ten Largest Holdings (% of total net assets) | |
Citigroup, Inc. | 8.9% |
Bank of America Corp. | 6.8 |
American International Group, Inc. | 5.3 |
JPMorgan Chase & Co. | 4.7 |
Wells Fargo & Co. | 3.6 |
Wachovia Corp. | 3.1 |
American Express Co. | 2.2 |
Fannie Mae | 2.0 |
Morgan Stanley | 2.0 |
U.S. Bancorp | 2.0 |
Top Ten | 40.6% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Financials. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
8
HEALTH CARE INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 293 | 293 | 2,494 |
Median Market Cap | $54.5B | $54.5B | $29.5B |
Price/Earnings Ratio | 33.9x | 33.9x | 25.6x |
Price/Book Ratio | 5.0x | 5.0x | 4.7x |
Yield | 1.3% | 1.7% | |
Admiral Shares | 1.0% | ||
VIPER Shares | 1.0% | ||
Return on Equity | 17.9% | 17.9% | 17.9% |
Earnings Growth Rate | 13.9% | 13.9% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 23%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28%† | ||
VIPER Shares | 0.27%† | ||
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Biotech Research & Production | 12% |
Drugs & Pharmaceuticals | 51 |
Electronics-Medical Systems | 5 |
Health & Personal Care | 5 |
Health Care Facilities | 4 |
Health Care Management Services | 8 |
Insurance-Multiline | 1 |
Medical & Dental Instruments & Supplies | 12 |
Medical Services | 1 |
Retail | 1 |
Ten Largest Holdings (% of total net assets) | |
Pfizer Inc. | 11.7% |
Johnson & Johnson | 11.5 |
Amgen, Inc. | 4.6 |
Merck & Co., Inc. | 4.2 |
Abbott Laboratories | 4.0 |
Medtronic, Inc. | 3.7 |
UnitedHealth Group Inc. | 3.5 |
Eli Lilly & Co. | 3.4 |
Wyeth | 3.2 |
Bristol-Myers Squibb Co. | 2.9 |
Top Ten | 52.7% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Health Care. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
INDUSTRIALS INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 315 | 315 | 2,494 |
Median Market Cap | $21.2B | $27.8B | $29.5B |
Price/Earnings Ratio | 23.5x | 23.0x | 25.6x |
Price/Book Ratio | 4.4x | 4.4x | 4.7x |
Yield-VIPER Shares | 1.3% | 1.6% | 1.7% |
Return on Equity | 17.6% | 17.8% | 17.9% |
Earnings Growth Rate | 12.7% | 12.5% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 6%† | — | — |
Expense Ratio-VIPER Shares | 0.28%† | — | — |
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Aerospace | 11% |
Air Transportation | 4 |
Auto Trucks & Parts | 1 |
Building Materials | 2 |
Communications Technology | 1 |
Diversified Manufaturing | 1 |
Diversified Production | 2 |
Education-Services | 2 |
Electrical Equipment & Components | 3 |
Electronics-Technology | 3 |
Engineering & Contracting Services | 1 |
Financial Information Services | 1 |
Financial-Miscellaneous | 1 |
Identification Control & Filter Devices | 3 |
Machinery-Agriculture | 1 |
Machinery-Construction & Handling | 3 |
Machinery-Industrial/Special | 4 |
Metal Fabricating | 1 |
Multi-Sector Companies | 33 |
Office Furniture & Business Equipment | 1 |
Office Supplies | 1 |
Publishing-Miscellaneous | 1 |
Railroads | 4 |
Retail | 1 |
Services-Commercial | 8 |
Transportation-Miscellaneous | 4 |
Truckers | 2 |
Ten Largest Holdings (% of total net assets) | |
General Electric Co. | 19.6% |
Tyco International Ltd. | 4.5 |
3M Co. | 4.2 |
United Technologies Corp. | 3.4 |
United Parcel Service, Inc. | 3.0 |
The Boeing Co. | 2.6 |
Caterpillar, Inc. | 2.2 |
Honeywell International Inc. | 2.1 |
FedEx Corp. | 1.9 |
Emerson Electric Co. | 1.8 |
Top Ten | 45.3% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Industrials. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
9
FUND PROFILES (CONTINUED) | |||
---|---|---|---|
INFORMATION TECHNOLOGY INDEX FUND | |||
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 446 | 446 | 2,494 |
Median Market Cap | $44.6B | $44.6B | $29.5B |
Price/Earnings Ratio | 33.4x | 33.2x | 25.6x |
Price/Book Ratio | 5.0x | 5.0x | 4.7x |
Yield | 0.5% | 1.7% | |
Admiral Shares | 0.3% | ||
VIPER Shares | 0.3% | ||
Return on Equity | 17.4% | 17.4% | 17.9% |
Earnings Growth Rate | 15.6% | 15.5% | 12.3% |
Foreign Holdings | 0.4% | 0.4% | 0.2% |
Turnover Rate | 6%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28† | ||
VIPER Shares | 0.27† | ||
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Communications Technology | 16% |
Computer Services Software & Systems | 25 |
Computer Technology | 23 |
Consumer Electronics | 4 |
Electronics | 1 |
Electronics-Semiconductors/Components | 18 |
Electronics-Technology | 1 |
Financial Data Processing Services | 5 |
Indentification Control & Filter Devices | 1 |
Office Furniture & Business Equipment | 2 |
Production Technical Equipment | 3 |
Services-Commercial | 1 |
Ten Largest Holdings (% of total net assets) | |
Microsoft Corp. | 12.2% |
International Business Machines Corp. | 7.6 |
Intel Corp. | 7.5 |
Cisco Systems, Inc. | 5.7 |
Dell Inc. | 4.5 |
Hewlett-Packard Co. | 3.0 |
QUALCOMM Inc. | 2.9 |
Oracle Corp. | 2.5 |
Texas Instruments, Inc. | 2.3 |
Yahoo! Inc. | 2.0 |
Top Ten | 50.2% |
“Ten Largest Holdings” excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Information Technology. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
MATERIALS INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 122 | 122 | 2,494 |
Median Market Cap | $12.4B | $12.4B | $29.5B |
Price/Earnings Ratio | 28.9x | 28.9x | 25.6x |
Price/Book Ratio | 3.3x | 3.3x | 4.7x |
Yield | 1.7% | 1.7% | |
Admiral Shares | 1.5% | ||
VIPER Shares | 1.5% | ||
Return on Equity | 16.6% | 16.6% | 17.9% |
Earnings Growth Rate | 9.2% | 9.2% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 6%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28%† | ||
VIPER Shares | 0.27%† | ||
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Agriculture-Fish & Ranch | 3% |
Aluminum | 6 |
Building-Cement | 1 |
Building Materials | 3 |
Chemicals | 39 |
Coal | 4 |
Consumer Products | 1 |
Container & Package-Metal & Glass | 2 |
Container & Package-Paper & Plastics | 5 |
Copper | 4 |
Diversified Manufacturing | 2 |
Fertilizers | 1 |
Forest Products | 6 |
Gold | 5 |
Metal Fabricating | 1 |
Metals & Minerals Miscellaneous | 1 |
Paints & Coating | 4 |
Paper | 6 |
Steel | 6 |
Ten Largest Holdings (% of total net assets) | |
E.I. du Pont de Nemours & Co. | 11.1% |
Dow Chemical Co. | 10.9 |
Alcoa Inc. | 5.9 |
Newmont Mining Corp. (Holding Co.) | 4.2 |
International Paper Co. | 3.6 |
Weyerhaeuser Co. | 3.4 |
Monsanto Co. | 3.3 |
Praxair, Inc. | 3.1 |
Air Products & Chemicals, Inc. | 3.0 |
PPG Industries, Inc. | 2.6 |
Top Ten | 51.1% |
“Ten Largest Holdings”excludes any temporary cash investments and equity index products. | |
*MSCI US IMI/Materials. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
10
TELECOMMUNICATION SERVICES INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 41 | 41 | 2,494 |
Median Market Cap | $17.3B | $47.2B | $29.5B |
Price/Earnings Ratio | 27.7x | 19.6x | 25.6x |
Price/Book Ratio | 6.1x | 3.7x | 4.7x |
Yield-VIPER Shares | 2.3% | 3.4% | 1.7% |
Return on Equity | 10.2% | 13.1% | 17.9% |
Earnings Growth Rate | 8.2% | 7.1% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 41%† | — | — |
Expense Ratio-VIPER Shares | 0.28%† | — | — |
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |
---|---|
Communications Technology | 2% |
Computer Services Software & Systems | 1 |
Services-Commercial | 1 |
Telecommunications Equipment | 4 |
Utilities-Telecommunications | 92 |
Ten Largest Holdings (% of total net assets ) | |
Verizon Communications Inc. | 20.0% |
SBC Communications Inc. | 14.8 |
BellSouth Corp. | 6.2 |
ALLTEL Corp. | 4.6 |
AT&T Corp. | 4.5 |
Nextel Communications, Inc. | 4.5 |
Sprint Corp. | 4.5 |
Qwest Communications International Inc. | 2.3 |
MCI Inc. | 2.2 |
Telephone & Data Systems, Inc. | 2.0 |
Top Ten | 65.6% |
“Ten Largest Holdings”excludes any temporary cash investments and equity index products. | |
*MSCI IMI/Telecommunication Services. | |
**MSCI US IMI/2500. | |
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
UTILITIES INDEX FUND | |||
---|---|---|---|
Portfolio Characteristics | |||
Target | Broad | ||
Fund | Index* | Index** | |
Number of Stocks | 91 | 91 | 2,494 |
Median Market Cap | $10.7B | $10.7B | $29.5B |
Price/Earnings Ratio | 28.5x | 30.7x | 25.6x |
Price/Book Ratio | 2.2x | 2.2x | 4.7x |
Yield | 3.5% | 1.7% | |
Admiral Shares | 3.4% | ||
VIPER Shares | 3.4% | ||
Return on Equity | 13.5% | 13.5% | 17.9% |
Earnings Growth Rate | 5.6% | 5.7% | 12.3% |
Foreign Holdings | 0.0% | 0.0% | 0.2% |
Turnover Rate | 10%† | — | — |
Expense Ratio | — | — | |
Admiral Shares | 0.28%† | ||
VIPER Shares | 0.27%† | ||
Short-Term Reserves | 0% | — | — |
Industry Diversification (% of portfolio) | |||
---|---|---|---|
Energy Miscellaneous | 2% | ||
Utilities-Electrical | 84 | ||
Utilities-Gas Distribution | 11 | ||
Utilities-Gas Pipelines | 1 | ||
Utilities-Miscellaneous | 1 | ||
Utilities-Water | 1 | ||
Ten Largest Holdings (% of total net assets) | |||
Exelon Corp. | 6.8% | ||
Duke Energy Corp. | 5.7 | ||
Dominion Resources, Inc. | 5.5 | ||
Southern Co. | 5.3 | ||
TXU Corp. | 4.0 | ||
Entergy Corp. | 3.5 | ||
PG&E Corp. | 3.4 | ||
FPL Group, Inc. | 3.1 | ||
FirstEnergy Corp. | 3.1 | ||
American Electric Power Co., Inc. | 3.0 | ||
Top Ten | 43.4% | ||
“Ten Largest Holdings”excludes any temporary cash investments and equity index products. | |||
*MSCI IMI/Utilities. | |||
**MSCI US IMI/2500. | |||
† Annualized. Turnover rate excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
Visit our website at Vanguard.com
for regularly updated fund information.
11
GLOSSARY OF INVESTMENT TERMS | |
Earnings Growth Rate. The average annual rate of growth in earnings over the past five years for the stocks now in a fund.
Expense Ratio. The percentage of a fund’s average net assets used to pay its annual administrative and advisory expenses. These expenses directly reduce returns to investors.
Foreign Holdings. The percentage of a fund’s equity assets represented by stocks or depositary receipts of companies based outside the United States.
Median Market Cap. An indicator of the size of companies in which a fund invests; the midpoint of market capitalization (market price x shares outstanding) of a fund’s stocks, weighted by the proportion of the fund’s assets invested in each stock. Stocks representing half of the fund’s assets have market capitalizations above the median, and the rest are below it.
Price/Book Ratio. The share price of a stock divided by its net worth, or book value, per share. For a fund, the weighted average price/book ratio of the stocks it holds.
Price/Earnings Ratio. The ratio of a stock’s current price to its per-share earnings over the past year. For a fund, the weighted average P/E of the stocks it holds. P/E is an indicator of market expectations about corporate prospects; the higher the P/E, the greater the expectations for a company’s future growth.
Return on Equity. The annual average rate of return generated by a company during the past five years for each dollar of shareholder’s equity (net income divided by shareholder’s equity). For a fund, the weighted average return on equity for the companies whose stocks it holds.
Short-Term Reserves. The percentage of a fund invested in highly liquid, short-term securities that can be readily converted to cash.
Turnover Rate. An indication of the fund’s trading activity. Funds with high turnover rates incur higher transaction costs and may be more likely to distribute capital gains (which may be taxable to investors).
Yield. A snapshot of a fund’s income from interest and dividends. The yield, expressed as a percentage of the fund’s net asset value, is based on income earned over the past 30 days and is annualized, or projected forward for the coming year. The index yield is based on the current annualized rate of income provided by securities in the index.
12
PERFORMANCE SUMMARIES | |
---|---|
As of 2/28/2005 | All of the returns in this report represent past performance, which is not a guarantee of future results that may be achieved by the funds. (For performance current to the most recent month-end, which may be higher or lower than that cited, visit our website at www.vanguard.com.) Note, too, that both investment returns and principal value can fluctuate widely, so an investor’s shares, when sold, could be worth more or less than their original cost. The returns shown do not reflect taxes that a shareholder would pay on fund distributions or on the sale of fund shares. |
CONSUMER DISCRETIONARY INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights table on page 54 for dividend and capital gains information.
CONSUMER STAPLES INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 54 for dividend and capital gains information.
Total Returns Since Inception for period ended December 31, 2004 | ||
---|---|---|
This table presents total returns through the latest calendar quarter-rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information. | ||
| Inception Date | Since Inception |
Consumer Discretionary Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | 10.81% | |
Net Asset Value | 10.75 | |
Consumer Staples Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | 9.26% | |
Net Asset Value | 9.32 | |
Admiral Shares | 1/30/2004 | 9.81 |
Fee-Adjusted Return* | 7.66 | |
*Reflective of the 2% fee assessed on redemptions of shares held for less than one year. |
13
PERFORMANCE SUMMARIES (CONTINUED)
ENERGY INDEX FUND
Fiscal-Period Total Returns (%) September 23, 2004*–February 28, 2005
*Inception.
Note: See Financial Highlights tables on page 55 for dividend and capital gains information.
FINANCIALS INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 55 for dividend and capital gains information.
HEALTH CARE INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 56 for dividend and capital gains information.
Total Returns Since Inception for period ended December 31, 2004 | ||
---|---|---|
This table presents total returns through the latest calendar quarter-rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information. | ||
| Inception Date | Since Inception |
Energy Index Fund | ||
VIPER Shares | 9/23/2004 | |
Market Price | 6.89% | |
Net Asset Value | 6.84 | |
Admiral Shares | 10/7/2004 | 1.08 |
Fee-Adjusted Return* | -0.94 | |
Financials Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | 8.79% | |
Net Asset Value | 8.69 | |
Admiral Shares | 2/4/2004 | 10.55 |
Fee-Adjusted Return* | 8.38 | |
Health Care Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | -0.23% | |
Net Asset Value | -0.35 | |
Admiral Shares | 2/5/2004 | -0.48 |
Fee-Adjusted Return* | -2.47 | |
*Reflective of the 2% fee assessed on redemptions of shares held for less than one year. |
14
INDUSTRIALS INDEX FUND
Fiscal-Period Total Returns (%) September 23, 2004*–February 28, 2005
*Inception.
Note: See Financial Highlights table on page 56 for dividend and capital gains information.
INFORMATION TECHNOLOGY INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 57 for dividend and capital gains information.
MATERIALS INDEX FUND
Fiscal-Period Total Returns (%) January 26, 2004–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 57 for dividend and capital gains information.
Total Returns Since Inception for period ended December 31, 2004 | ||
---|---|---|
This table presents total returns through the latest calendar quarter-rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information. | ||
| Inception Date | Since Inception |
Industrials Index Fund | ||
VIPER Shares | 9/23/2004 | |
Market Price | 13.31% | |
Net Asset Value | 13.22 | |
Information Technology Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | -6.44% | |
Net Asset Value | -6.36 | |
Admiral Shares | 3/25/2004 | 4.30 |
Fee-Adjusted Return* | 2.24 | |
Materials Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | 20.91% | |
Net Asset Value | 20.83 | |
Admiral Shares | 2/11/2004 | 16.41 |
Fee-Adjusted Return* | 14.12 | |
*Reflective of the 2% fee assessed on redemptions of shares held for less than one year. |
15
PERFORMANCE SUMMARIES (CONTINUED)
TELECOMMUNICATION SERVICES INDEX FUND
Fiscal-Period Total Returns (%) September 23, 2004*–February 28, 2005
*Inception.
Note: See Financial Highlights table on page 58 for dividend and capital gains information.
UTILITIES INDEX FUND
Fiscal-Period Total Returns (%) September 23, 2004*–February 28, 2005
*Six months ended February 28, 2005.
Note: See Financial Highlights tables on page 58 for dividend and capital gains information.
Total Returns Since Inception for period ended December 31, 2004 | ||
---|---|---|
This table presents total returns through the latest calendar quarter-rather than through the end of the fiscal period. Securities and Exchange Commission rules require that we provide this information. | ||
Since | ||
Inception Date | Inception | |
Telecommunication Services Index Fund | ||
VIPER Shares | 9/23/2004 | |
Market Price | 11.77% | |
Net Asset Value | 11.80 | |
Utilities Index Fund | ||
VIPER Shares | 1/26/2004 | |
Market Price | 20.94% | |
Net Asset Value | 20.87 | |
Admiral Shares | 4/28/2004 | 20.43 |
Fee-Adjusted Return* | 18.08 | |
*Reflective of the 2% fee assessed on redemptions of shares held for less than one year. |
16
ABOUT YOUR FUND'S EXPENSES | |
We believe it is important for you to understand the impact of costs on your investment. All mutual funds have operating expenses. As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of the fund.
A fund’s expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The examples on this page are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.
The adjacent table illustrates your fund’s costs in two ways:
• 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.
To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading “Expenses Paid During 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.
Note that the expenses shown in the table are meant to highlight and help you compare ongoing costs only; they do not include the 2% fee assessed on redemptions of Admiral Shares held for less than one year. If the fee were applied to your account, your costs would be higher. The funds do not carry a “sales load.”
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions.
You can find more information about the fund’s expenses in the Financial Statements section of this report. For additional information on operating expenses and other shareholder costs, please refer to the appropriate fund prospectus.
Six Months Ended February 28, 2005* | |||
---|---|---|---|
Index Fund | Beginning Account Value Aug. 31, 2004 | Ending Account Value Feb. 28, 2005 | Expenses Paid During Period** |
Based on Actual Fund Return | |||
Consumer Discretionary Index Fund | |||
VIPER Shares | $1,000.00 | $1,135.79 | $1.48 |
Consumer Staples Index Fund | |||
Admiral Shares | $1,000.00 | $1,081.43 | $1.45 |
VIPER Shares | 1,000.00 | 1,081.59 | 1.39 |
Financials Index Fund | |||
Admiral Shares | $1,000.00 | $1,050.76 | $1.42 |
VIPER Shares | 1,000.00 | 1,050.47 | 1.37 |
Health Care Index Fund | |||
Admiral Shares | $1,000.00 | $1,046.19 | $1.42 |
VIPER Shares | 1,000.00 | 1,046.22 | 1.37 |
Information Technology Index Fund | |||
Admiral Shares | $1,000.00 | $1,114.28 | $1.47 |
VIPER Shares | 1,000.00 | 1,078.42 | 1.39 |
Materials Index Fund | |||
Admiral Shares | $1,000.00 | $1,204.11 | $1.53 |
VIPER Shares | 1,000.00 | 1,204.18 | 1.48 |
Utilities Index Fund | |||
Admiral Shares | $1,000.00 | $1,168.96 | $1.51 |
VIPER Shares | 1,000.00 | 1,169.07 | 1.45 |
Based on Hypothetical 5% Yearly Return | |||
Consumer Discretionary Index Fund | |||
VIPER Shares | $1,000.00 | $1,023.41 | $1.40 |
Consumer Staples Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
Financials Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
Health Care Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
Information Technology Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
Materials Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
Utilities Index Fund | |||
Admiral Shares | $1,000.00 | $1,023.41 | $1.40 |
VIPER Shares | 1,000.00 | 1,023.46 | 1.35 |
*The table does not include data for funds or share classes of funds with fewer than six months of history. | |||
**The calculations are based on expenses incurred in the most recent six-month period. The funds’ annualized six-month expense ratios for that period are: 0.28% for the Consumer Discretionary Index Fund VIPER Shares; 0.28% for the Consumer Staples Index Fund Admiral Shares and 0.27% for the VIPER Shares; 0.28% for the Financials Index Fund Admiral Shares and 0.27% for the VIPER Shares; 0.28% for the Health Care Index Fund Admiral Shares and 0.27% for the VIPER Shares; 0.28% for the Information Technology Index Fund Admiral Shares and 0.27% for the VIPER Shares; 0.28% for the Materials Index Fund Admiral Shares and 0.27% for the VIPER Shares; 0.28% for the Utilities Index Fund Admiral Shares and 0.27% for the VIPER Shares. The dollar amounts shown as “Expenses Paid” are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by the number of days in the most recent 12-month period. |
17
As of 2/28/2005 | FINANCIAL STATEMENTS (UNAUDITED) |
---|---|
STATEMENT OF NET ASSETS
This Statement provides a detailed list of each fund’s holdings, including each security’s market value on the last day of the reporting period. Securities are grouped and subtotaled by asset type (common stocks, bonds, etc.) and by industry sector. Other assets are added to, and liabilities are subtracted from, the value of Total Investments to calculate the fund’s Net Assets. Finally, Net Assets are divided by the outstanding shares of the fund to arrive at its share price, or Net Asset Value (NAV) Per Share.
At the end of the Statement of Net Assets, you will find a table displaying the composition of the fund’s net assets. Because all income and any realized gains must be distributed to shareholders each year, the bulk of net assets consists of Paid-in Capital (money invested by shareholders). The amounts shown for Undistributed Net Investment Income and Accumulated Net Realized Gains usually approximate the sums the fund had available to distribute to shareholders as income dividends or capital gains as of the statement date, but may differ because certain investments or transactions may be treated differently for financial statement and tax purposes. Any Accumulated Net Realized Losses, and any cumulative excess of distributions over net income or net realized gains, will appear as negative balances.
Unrealized Appreciation (Depreciation) is the difference between the market value of the fund’s investments and their cost, and reflects the gains (losses) that would be realized if the fund were to sell all of its investments at their statement-date values. Each fund provides a complete list of its holdings four times in each fiscal year, at the quarter-ends. For the second and fourth fiscal quarters, the lists appear in the fund’s semiannual and annual reports to shareholders. For the first and third fiscal quarters, the fund files the lists with the Securities and Exchange Commission on Form N-Q. Shareholders can look up the fund’s Forms N-Q on the SEC’s website at www.sec.gov. Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room (see the back cover of this report for further information).
Consumer Discretionary Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (100.2%) | ||
Advertising Agencies (2.1%) | ||
Omnicom Group Inc. | 1,798 | 164 |
* Interpublic Group of Cos., Inc. | 3,993 | 52 |
* Lamar Advertising Co. Class A | 835 | 33 |
* R.H. Donnelley Corp. | 307 | 19 |
* Valassis Communications, Inc. | 417 | 16 |
ADVO, Inc. | 394 | 14 |
Harte-Hanks, Inc. | 510 | 14 |
Catalina Marketing Corp. | 366 | 10 |
Grey Global Group Inc. | 5 | 6 |
328 | ||
Auto Parts-Aftermarket (0.6%) | ||
Genuine Parts Co. | 1,621 | 70 |
TBC Corp. | 285 | 9 |
Keystone Automotive Industries, Inc. | 222 | 5 |
*TRW Automotive Holdings Corp. | 205 | 4 |
*Aftermarket Technology Corp. | 221 | 3 |
Superior Industries International, Inc. | 113 | 3 |
94 | ||
Auto Parts-Original Equipment (1.0%) | ||
Delphi Corp. | 4,864 | 33 |
Lear Corp. | 568 | 30 |
BorgWarner, Inc. | 442 | 23 |
Dana Corp. | 1,371 | 20 |
ArvinMeritor, Inc. | 693 | 12 |
American Axle & Manufacturing Holdings, Inc. | 345 | 9 |
Visteon Corp. | 1,198 | 8 |
*Tenneco Automotive, Inc. | 438 | 7 |
Hayes Lemmerz International, Inc. | 441 | 3 |
Stoneridge, Inc. | 206 | 2 |
Strattec Security Corp. | 32 | 2 |
Collins & Aikman Corp. | 248 | 1 |
150 | ||
Auto Trucks & Parts (0.2%) | ||
Gentex Corp. | 620 | 21 |
Modine Manufacturing Co. | 360 | 12 |
33 | ||
Automobiles (2.4%) | ||
Ford Motor Co. | 16,646 | 211 |
General Motors Corp. | 4,926 | 176 |
387 | ||
Building Materials (0.1%) | ||
Building Materials Holding Corp. | 209 | 10 |
Cable Television Services (2.5%) | ||
Liberty Media Corp. | 24,093 | 244 |
Liberty Media International Inc. Class A | 1,520 | 66 |
EchoStar Communications Corp. Class A | 1,951 | 58 |
*Insight Communications Co., Inc. | 542 | 5 |
*Charter Communications, Inc. | 2,680 | 5 |
*TiVo Inc. | 596 | 2 |
380 | ||
Casinos & Gambling (2.9%) | ||
International Game Technology | 3,225 | 98 |
Harrah's Entertainment, Inc. | 991 | 65 |
*Caesars Entertainment, Inc. | 2,602 | 52 |
Mandalay Resort Group | 670 | 47 |
*MGM Mirage, Inc. | 611 | 45 |
Station Casinos, Inc. | 503 | 31 |
GTECH Holdings Corp. | 1,097 | 26 |
*Argosy Gaming Co. | 351 | 16 |
*Scientific Games Corp. | 601 | 15 |
Boyd Gaming Corp. | 315 | 15 |
*Aztar Corp. | 438 | 13 |
*WMS Industries, Inc. | 276 | 8 |
*Shuffle Master, Inc. | 227 | 7 |
Churchill Downs, Inc. | 159 | 7 |
*Pinnacle Entertainment, Inc. | 424 | 7 |
Alliance Gaming Corp. | 525 | 6 |
*MTR Gaming Group Inc. | 338 | 4 |
*Multimedia Games Inc. | 317 | 3 |
Ameristar Casinos, Inc. | 39 | 2 |
*Isle of Capri Casinos, Inc. | 52 | 1 |
Dover Downs Gaming & Entertainment, Inc. | 90 | 1 |
469 | ||
Chemicals (0.0%) | ||
Exide Technologies | 25 | 1 |
Commercial Information Services (0.1%) | ||
Arbitron Inc. | 203 | 8 |
*ProQuest Co. | 155 | 6 |
14 | ||
Communications & Media (5.4%) | ||
*Time Warner, Inc. | 42,044 | 724 |
News Corp., Inc., Class B | 5,681 | 98 |
Telewest Global, Inc. | 1,092 | 18 |
Gemstar-TV Guide International, Inc. | 2,144 | 10 |
Entravision Communications Corp. | 480 | 4 |
854 | ||
18
| Shares | Market Value^ (000) |
---|---|---|
Computer Services Software & Systems (0.0%) | ||
*Audible, Inc. | 153 | $ 2 |
Construction (0.0%) | ||
Brookfield Homes Corp. | 74 | 3 |
Consumer Electronics (0.5%) | ||
Harman International Industries, Inc. | 618 | 69 |
*NetFlix.com, Inc. | 284 | 3 |
Alloy, Inc. | 263 | 2 |
74 | ||
Consumer Products (0.6%) | ||
American Greetings Corp. Class A | 705 | 17 |
Snap-On Inc. | 488 | 16 |
*Jarden Corp. | 342 | 15 |
*The Yankee Candle Co., Inc. | 414 | 13 |
Tupperware Corp. | 608 | 12 |
Blyth, Inc. | 351 | 11 |
The Nautilus Group, Inc. | 382 | 8 |
*RC2 Corp. | 145 | 4 |
Oakley, Inc. | 169 | 2 |
CSS Industries, Inc. | 16 | 1 |
The Boyds Collection, Ltd. | 218 | 1 |
100 | ||
Cosmetics (0.1%) | ||
*Helen of Troy Ltd. | 338 | 10 |
Electrical-Household Appliances (0.4%) | ||
Whirlpool Corp. | 689 | 44 |
Maytag Corp. | 856 | 13 |
National Presto Industries, Inc. | 15 | 1 |
58 | ||
Entertainment (7.5%) | ||
The Walt Disney Co. | 19,440 | 543 |
Viacom Inc. Class B | 14,320 | 500 |
*Fox Entertainment Group, Inc. Class A | 1,804 | 60 |
Pixar, Inc. | 209 | 19 |
*Gaylord Entertainment Co. | 432 | 18 |
DreamWorks Animation SKG, Inc. | 435 | 16 |
International Speedway Corp. | 178 | 9 |
Speedway Motorsports, Inc. | 244 | 9 |
Regal Entertainment Group Class A | 394 | 8 |
Metro-Goldwyn-Mayer Inc. | 626 | 7 |
*Hollywood Entertainment Corp. | 520 | 7 |
Movie Gallery, Inc. | 193 | 4 |
1,200 | ||
Financial Information Services (0.1%) | ||
Dow Jones & Co., Inc. | 382 | 14 |
*Interactive Data Corp. | 364 | 7 |
21 | ||
Home Building (3.7%) | ||
D. R. Horton, Inc. | 2,057 | 90 |
Pulte Homes, Inc. | 982 | 77 |
Centex Corp. | 1,130 | 72 |
Lennar Corp. Class A | 1,147 | 70 |
*Toll Brothers, Inc. | 539 | 47 |
KB HOME | 346 | 43 |
*NVR, Inc. | 53 | 42 |
Standard Pacific Corp. | 374 | 30 |
Ryland Group, Inc. | 397 | 28 |
*Hovnanian Enterprises Inc. Class A | 416 | 23 |
MDC Holdings, Inc. | 260 | 21 |
*Meritage Corp. | 234 | 17 |
Beazer Homes USA, Inc. | 76 | 13 |
M/I Homes, Inc. | 199 | 11 |
Technical Olympic USA, Inc. | 81 | 2 |
Levitt Corp. Class A | 65 | 2 |
*William Lyon Homes, Inc. | 14 | 1 |
589 | ||
Hotel/Motel (2.2%) | ||
Marriott International, Inc. Class A | 1,857 | 119 |
Starwood Hotels & Resorts Worldwide, Inc. | 1,987 | 114 |
Hilton Hotels Corp. | 3,497 | 74 |
*Wynn Resorts Ltd. | 409 | 29 |
Orient-Express Hotel Ltd. | 298 | 8 |
The Marcus Corp. | 266 | 6 |
Choice Hotel International, Inc. | 98 | 6 |
356 | ||
Household Equipment & Products (0.6%) | ||
Black & Decker Corp. | 774 | 64 |
The Stanley Works | 701 | 32 |
96 | ||
Household Furnishings (1.3%) | ||
Newell Rubbermaid, Inc. | 2,620 | 58 |
Leggett & Platt, Inc. | 1,743 | 48 |
Mohawk Industries, Inc. | 527 | 47 |
Furniture Brands International Inc. | 429 | 10 |
Ethan Allen Interiors, Inc. | 255 | 9 |
La-Z-Boy Inc. | 566 | 8 |
Tempur-Pedic International Inc. | 418 | 8 |
Select Comfort Corp. | 320 | 7 |
Libbey, Inc. | 214 | 5 |
Haverty Furniture Cos., Inc. | 245 | 4 |
Bombay Co. | 390 | 2 |
Kirkland's, Inc. | 57 | 1 |
207 | ||
Identification Control & Filter Devices (0.2%) | ||
Garmin Ltd. | 547 | 28 |
Jewelry, Watches & Gems (0.4%) | ||
Tiffany & Co. | 1,356 | 41 |
*Fossil, Inc. | 546 | 14 |
Movado Group, Inc. | 243 | 5 |
60 | ||
Leisure Time (1.8%) | ||
Carnival Corp. | 3,921 | 213 |
*Penn National Gaming, Inc. | 276 | 17 |
SCP Pool Corp. | 427 | 15 |
Callaway Golf Co. | 756 | 10 |
K2 Inc. | 446 | 6 |
West Marine, Inc. | 227 | 5 |
Vail Resorts Inc. | 173 | 4 |
Six Flags, Inc. | 875 | 4 |
Action Performance Cos., Inc. | 255 | 4 |
*Steiner Leisure Ltd. | 46 | 2 |
Sturm, Ruger & Co., Inc. | 143 | 1 |
Life Time Fitness, Inc. | 11 | 1 |
282 | ||
Manufactured Housing (0.1%) | ||
*Champion Enterprises, Inc. | 736 | 8 |
Skyline Corp. | 23 | 1 |
*Palm Harbor Homes, Inc. | 33 | 1 |
10 | ||
Miscellaneous Business & Consumer Discretionary (0.2%) | ||
E.W. Scripps Co. Class A | 704 | 33 |
Multi-Sector Companies (1.6%) | ||
Johnson Controls, Inc. | 1,840 | 109 |
Fortune Brands, Inc. | 1,341 | 109 |
Brunswick Corp. | 810 | 38 |
256 | ||
Office Furniture & Business Equipment (0.0%) | ||
Kimball International, Inc. Class B | 306 | 4 |
Paints & Coating (0.3%) | ||
Sherwin-Williams Co. | 1,138 | 50 |
19
| Shares | Market Value^ (000) |
---|---|---|
Photography (0.6%) | ||
Eastman Kodak Co. | 2,742 | 93 |
Publishing--Miscellaneous (1.6%) | ||
The McGraw-Hill Cos., Inc. | 1,806 | 166 |
Dex Media, Inc. | 808 | 18 |
Meredith Corp. | 378 | 17 |
Reader's Digest Association, Inc. | 922 | 16 |
John Wiley & Sons Class A | 445 | 15 |
Scholastic Corp. | 427 | 15 |
*PRIMEDIA Inc. | 1,067 | 4 |
*Playboy Enterprises, Inc. Class B | 292 | 4 |
Martha Stewart Living Omnimedia, Inc. | 82 | 3 |
Courier Corp. | 22 | 1 |
Advanced Marketing Services | 71 | 1 |
260 | ||
Publishing--Newspapers (3.3%) | ||
Gannett Co., Inc. | 2,504 | 197 |
Tribune Co. | 2,199 | 90 |
Washington Post Co. Class B | 54 | 48 |
New York Times Co. Class A | 1,299 | 48 |
Knight Ridder | 700 | 46 |
Belo Corp. Class A | 1,004 | 24 |
Lee Enterprises, Inc. | 445 | 20 |
The McClatchy Co. Class A | 195 | 14 |
Media General, Inc. Class A | 197 | 13 |
*Journal Register Co. | 455 | 8 |
Hollinger International, Inc. | 524 | 6 |
Pulitzer, Inc. | 66 | 4 |
Journal Communications, Inc. | 177 | 3 |
521 | ||
Radio & Television Broadcasters (5.0%) | ||
The News Corp., Inc. | 14,430 | 240 |
Clear Channel Communications, Inc. | 4,658 | 155 |
DirecTV Group, Inc. | 7,657 | 115 |
Sirius Satellite Radio, Inc. | 11,803 | 66 |
Univision Communications Inc. | 2,162 | 57 |
XM Satellite Radio Holdings, Inc. | 1,629 | 54 |
Entercom Communications Corp. | 499 | 17 |
Westwood One, Inc. | 694 | 15 |
*Radio One, Inc. Class D | 654 | 9 |
Cumulus Media Inc. | 609 | 9 |
*Emmis Communications, Inc. | 409 | 8 |
Citadel Broadcasting Corp. | 452 | 6 |
Gray Television, Inc. | 363 | 5 |
Cox Radio, Inc. | 292 | 5 |
Radio One, Inc. | 292 | 4 |
*Salem Communications Corp. | 169 | 4 |
Hearst-Argyle Television Inc. | 154 | 4 |
Liberty Corp. | 70 | 3 |
Spanish Broadcasting System, Inc. | 301 | 3 |
Lin TV Corp. | 163 | 3 |
Sinclair Broadcast Group, Inc. | 362 | 3 |
Saga Communications, Inc. | 162 | 3 |
World Wrestling Entertainment, Inc. | 179 | 2 |
Young Broadcasting Inc. | 247 | 2 |
Regent Communications, Inc. | 321 | 2 |
Fisher Communications, Inc. | 18 | 1 |
*Beasley Broadcast Group, Inc. | 23 | 1 |
796 | ||
Real Estate (0.1%) | ||
WCI Communities, Inc. | 357 | 12 |
Avatar Holding, Inc. | 23 | 1 |
13 | ||
Real Estate Investment Trusts (0.1%) | ||
*La Quinta Corp. REIT | 1,563 | 14 |
Recreational Vehicles & Boats (1.5%) | ||
Harley-Davidson, Inc. | 2,793 | 173 |
Polaris Industries, Inc. | 334 | 23 |
Thor Industries, Inc. | 446 | 16 |
Winnebago Industries, Inc. | 346 | 12 |
Monaco Coach Corp. | 352 | 6 |
Arctic Cat, Inc. | 221 | 6 |
Fleetwood Enterprises, Inc. | 430 | 4 |
Coachmen Industries, Inc. | 235 | 4 |
Marine Products Corp. | 9 | 1 |
245 | ||
Rent & Lease Services--Consumer (0.1%) | ||
*Rent-A-Center, Inc. | 546 | 14 |
Aaron Rents, Inc. Class B | 450 | 9 |
23 | ||
Restaurants (6.8%) | ||
McDonald's Corp. | 12,024 | 398 |
Starbucks Corp. | 3,751 | 194 |
Yum! Brands, Inc. | 2,731 | 133 |
Darden Restaurants Inc. | 1,475 | 40 |
Wendy's International, Inc. | 968 | 37 |
*Brinker International, Inc. | 880 | 33 |
Outback Steakhouse | 534 | 24 |
Applebee's International, Inc. | 754 | 22 |
Panera Bread Co. | 377 | 20 |
*The Cheesecake Factory | 580 | 20 |
Ruby Tuesday, Inc. | 743 | 18 |
CBRL Group, Inc. | 408 | 17 |
*Jack in the Box Inc. | 454 | 16 |
*Sonic Corp. | 483 | 16 |
P.F. Chang's China Bistro, Inc. | 239 | 13 |
*CEC Entertainment Inc. | 290 | 11 |
*Red Robin Gourmet Burgers | 200 | 9 |
Lone Star Steakhouse & Saloon, Inc. | 277 | 7 |
*Rare Hospitality International Inc. | 233 | 7 |
*CKE Restaurants Inc. | 417 | 6 |
Steak n Shake Co. | 329 | 6 |
*California Pizza Kitchen, Inc. | 262 | 6 |
O'Charley's Inc. | 272 | 6 |
Bob Evans Farms, Inc. | 245 | 6 |
Triarc Cos., Inc. Class B | 364 | 5 |
IHOP Corp. | 104 | 5 |
Ryan's Restaurant Group, Inc. | 355 | 5 |
Landry's Restaurants, Inc. | 145 | 4 |
Krispy Kreme Doughnuts, Inc. | 555 | 3 |
*Papa John's International, Inc. | 42 | 1 |
Triarc Cos., Inc. Class A | 76 | 1 |
1,089 | ||
Retail (28.7%) | ||
Home Depot, Inc. | 21,029 | 842 |
Lowe's Cos., Inc. | 7,016 | 412 |
Target Corp. | 8,093 | 411 |
Staples, Inc. | 4,780 | 151 |
Best Buy Co., Inc. | 2,625 | 142 |
Kohl's Corp. | 2,942 | 141 |
The Gap, Inc. | 6,103 | 130 |
J.C. Penney Co., Inc. (Holding Co.) | 2,759 | 123 |
TJX Cos., Inc. | 4,817 | 118 |
Bed Bath & Beyond, Inc. | 2,823 | 106 |
Amazon.com, Inc. | 2,873 | 101 |
Sears, Roebuck & Co. | 1,904 | 95 |
May Department Stores Co. | 2,610 | 90 |
Federated Department Stores, Inc. | 1,561 | 88 |
Limited Brands, Inc. | 3,100 | 74 |
Nordstrom, Inc. | 1,114 | 60 |
AutoZone Inc. | 616 | 60 |
*Office Depot, Inc. | 2,982 | 57 |
Dollar General Corp. | 2,664 | 57 |
Family Dollar Stores, Inc. | 1,451 | 48 |
20
| Shares | Market Value^ (000) |
---|---|---|
Abercrombie & Fitch Co. | 866 | $ 47 |
Toys R Us, Inc. | 2,013 | 46 |
PETsMART, Inc. | 1,509 | 46 |
RadioShack Corp. | 1,460 | 43 |
*Chico's FAS, Inc. | 1,458 | 43 |
Foot Locker, Inc. | 1,468 | 40 |
Ross Stores, Inc. | 1,422 | 40 |
Michaels Stores, Inc. | 1,223 | 39 |
*Kmart Holding Corp. | 400 | 39 |
AutoNation, Inc. | 1,848 | 36 |
*Advance Auto Parts, Inc. | 704 | 35 |
Williams-Sonoma, Inc. | 885 | 31 |
CarMax, Inc. | 926 | 31 |
*O'Reilly Automotive, Inc. | 566 | 29 |
Circuit City Stores, Inc. | 1,812 | 28 |
*Dollar Tree Stores, Inc. | 989 | 27 |
OfficeMax, Inc. | 733 | 23 |
*Urban Outfitters, Inc. | 556 | 23 |
American Eagle Outfitters, Inc. | 424 | 23 |
*Barnes & Noble, Inc. | 652 | 22 |
Claire's Stores, Inc. | 899 | 21 |
The Neiman Marcus Group, Inc. Class A | 286 | 21 |
*Pacific Sunwear of California, Inc. | 689 | 18 |
Borders Group, Inc. | 671 | 17 |
Saks Inc. | 1,122 | 17 |
Tractor Supply Co. | 393 | 17 |
*PETCO Animal Supplies, Inc. | 458 | 16 |
Blockbuster Inc. Class A | 1,642 | 15 |
Guitar Center, Inc. | 239 | 14 |
*Men's Wearhouse, Inc. | 410 | 14 |
Pier 1 Imports Inc. | 787 | 14 |
Dillard's Inc. | 599 | 14 |
*Zale Corp. | 452 | 13 |
*Dick's Sporting Goods, Inc. | 375 | 13 |
Big Lots Inc. | 1,093 | 13 |
AnnTaylor Stores Corp. | 558 | 12 |
The Pep Boys (Manny, Moe & Jack) | 578 | 10 |
*GameStop Corp. | 525 | 10 |
*Aeropostale, Inc. | 319 | 10 |
*Stage Stores, Inc. | 263 | 10 |
The Neiman Marcus Group, Inc. Class B | 145 | 10 |
Overstock.com, Inc. | 186 | 10 |
Linens 'n Things, Inc. | 368 | 10 |
*Hibbett Sporting Goods, Inc. | 328 | 9 |
Cato Corp. Class A | 295 | 9 |
*The Children's Place Retail Stores, Inc. | 219 | 9 |
Jo-Ann Stores, Inc. | 287 | 9 |
*Insight Enterprises, Inc. | 481 | 9 |
*Hot Topic, Inc. | 400 | 9 |
Brown Shoe Co., Inc. | 253 | 8 |
*Coldwater Creek Inc. | 302 | 8 |
*Genesco, Inc. | 282 | 8 |
MarineMax, Inc. | 242 | 8 |
Charming Shoppes, Inc. | 1,031 | 8 |
Sonic Automotive, Inc. | 343 | 8 |
*Too Inc. | 286 | 8 |
Burlington Coat Factory Warehouse Corp. | 252 | 7 |
*The Sports Authority, Inc. | 277 | 7 |
Payless ShoeSource, Inc. | 575 | 7 |
*CSK Auto Corp. | 391 | 6 |
*Stein Mart, Inc. | 296 | 6 |
Lithia Motors, Inc. | 220 | 6 |
The Buckle, Inc. | 184 | 6 |
Blair Corp. | 167 | 5 |
99 Cents Only Stores | 336 | 5 |
Christopher & Banks Corp. | 316 | 5 |
*Tuesday Morning Corp. | 163 | 5 |
Russ Berrie and Co., Inc. | 203 | 5 |
Deb Shops, Inc. | 153 | 4 |
Talbots Inc. | 155 | 4 |
*Cabela's Inc. | 202 | 4 |
ShopKo Stores, Inc. | 242 | 4 |
Fred's, Inc. | 245 | 4 |
ValueVision Media, Inc. | 312 | 4 |
*J. Jill Group, Inc. | 264 | 4 |
Asbury Automotive Group, Inc. | 228 | 3 |
Cost Plus, Inc. | 115 | 3 |
Handleman Co. | 152 | 3 |
*The Dress Barn, Inc. | 165 | 3 |
United Auto Group, Inc. | 106 | 3 |
The Gymboree Corp. | 246 | 3 |
*Priceline.com, Inc. | 127 | 3 |
Group 1 Automotive, Inc. | 98 | 3 |
1-800-FLOWERS.COM, Inc. | 344 | 3 |
Big 5 Sporting Goods Corp. | 102 | 2 |
Hancock Fabrics, Inc. | 256 | 2 |
Stamps.com Inc. | 100 | 2 |
GSI Commerce, Inc. | 119 | 2 |
Blue Nile Inc. | 59 | 2 |
*Electronics Boutique Holdings Corp. | 42 | 2 |
*A.C. Moore Arts & Crafts, Inc. | 44 | 1 |
Charlotte Russe Holding Inc. | 92 | 1 |
bebe stores, inc | 37 | 1 |
The Pantry, Inc. | 30 | 1 |
Drugstore.com, Inc. | 435 | 1 |
Sharper Image Corp. | 40 | 1 |
Blockbuster Inc. Class B | 70 | 1 |
1-800 CONTACTS, Inc. | 19 | 1 |
*GameStop Corp. Class B | 19 | 1 |
Conn's, Inc. | 5 | — |
4,572 | ||
Services-Commercial (3.7%) | ||
eBay Inc. | 9,492 | 407 |
IAC/InterActiveCorp | 4,464 | 100 |
*Getty Images, Inc. | 497 | 35 |
*Weight Watchers International, Inc. | 502 | 22 |
Regis Corp. | 310 | 12 |
UniFirst Corp. | 174 | 7 |
4Kids Entertainment Inc. | 211 | 4 |
*Harris Interactive Inc. | 556 | 3 |
590 | ||
Shoes (1.5%) | ||
NIKE, Inc. Class B | 1,751 | 152 |
Reebok International Ltd. | 567 | 25 |
*Timberland Co. | 284 | 20 |
Wolverine World Wide, Inc. | 508 | 11 |
K-Swiss, Inc. | 352 | 11 |
Finish Line, Inc. | 527 | 11 |
The Stride Rite Corp. | 336 | 4 |
*Steven Madden, Ltd. | 212 | 4 |
*Skechers U.S.A., Inc. | 249 | 4 |
Kenneth Cole Productions, Inc. | 27 | 1 |
243 | ||
Textile Products (0.0%) | ||
Interface, Inc. | 465 | 4 |
DHB Industries, Inc. | 222 | 3 |
7 | ||
Textile-Apparel Manufacturing (2.0%) | ||
Coach, Inc. | 1,733 | 96 |
VF Corp. | 751 | 45 |
Liz Claiborne, Inc. | 986 | 42 |
Jones Apparel Group, Inc. | 1,166 | 37 |
Polo Ralph Lauren Corp. | 599 | 24 |
*Quiksilver, Inc. | 653 | 21 |
Kellwood Co. | 362 | 10 |
Tommy Hilfiger Corp. | 955 | 10 |
*The Warnaco Group, Inc. | 373 | 9 |
Phillips-Van Heusen Corp. | 314 | 9 |
21
| Shares | Market Value^ (000) |
---|---|---|
*Columbia Sportswear Co. | 140 | $ 8 |
Russell Corp. | 293 | 5 |
Carter's, Inc. | 94 | 4 |
*Guess ?, Inc. | 153 | 2 |
Oxford Industries, Inc. | 46 | 2 |
Oshkosh B' Gosh, Inc. Class A | 29 | 1 |
325 | ||
Tires & Rubber (0.3%) | ||
*The Goodyear Tire & Rubber Co. | 1,624 | 23 |
Cooper Tire & Rubber Co. | 737 | 14 |
Bandag, Inc. Class A | 151 | 6 |
Bandag, Inc. | 22 | 1 |
44 | ||
Toys (0.9%) | ||
Mattel, Inc. | 4,113 | 86 |
Hasbro, Inc. | 1,650 | 35 |
*Marvel Enterprises Inc. | 840 | 15 |
JAKKS Pacific, Inc. | 301 | 6 |
Leapfrog Enterprises, Inc. | 117 | 1 |
143 | ||
Utilities-Cable Television & Radio (4.8%) | ||
*Comcast Corp. Class A | 12,211 | 397 |
*Comcast Corp. Special Class A | 8,134 | 259 |
Cablevision Systems NY Group Class A | 2,075 | 64 |
*UnitedGlobalCom Inc. Class A | 3,615 | 34 |
*Mediacom Communications Corp. | 635 | 4 |
758 | ||
Utilities-Telecommunications (0.3%) | ||
NTL Inc. | 762 | 49 |
Wholesalers (0.0%) | ||
LKQ Corp. | 48 | 1 |
TOTAL INVESTMENTS | ||
(Cost $15,159) | 15,945 | |
OTHER ASSETS AND LIABILITIES (-0.2%) | ||
Other Assets--Note B | 16 | |
Liabilities | (51) | |
(35) | ||
NET ASSETS (100%) | $15,910 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $15,151 |
Undistributed Net Investment Income | 44 |
Accumulated Net Realized Losses | (71) |
Unrealized Appreciation | 786 |
NET ASSETS | $15,910 |
VIPER Shares-Net Assets | |
Applicable to 300,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $15,910 |
NET ASSET VALUE PER SHARE-VIPER SHARES | $53.03 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
22
Consumer Staples Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (99.9%) | ||
Agriculture-Fish & Ranch (0.8%) | ||
Bunge Ltd. | 3,155 | $ 173 |
Delta & Pine Land Co. | 1,538 | 45 |
Alico, Inc. | 364 | 21 |
239 | ||
Beverage-Brewers & Wineries (4.4%) | ||
Anheuser-Busch Cos., Inc. | 20,567 | 976 |
*Constellation Brands, Inc. Class A | 2,811 | 151 |
Molson Coors Brewing Co-B | 2,026 | 141 |
*Boston Beer Co., Inc. Class A | 953 | 23 |
1,291 | ||
Beverage-Distillers (0.2%) | ||
Brown-Forman Corp. Class B | 1,318 | 67 |
Beverage-Soft Drinks (15.1%) | ||
The Coca-Cola Co. | 47,870 | 2,049 |
PepsiCo, Inc. | 36,836 | 1,984 |
Coca-Cola Enterprises, Inc. | 7,362 | 157 |
The Pepsi Bottling Group, Inc. | 4,843 | 132 |
PepsiAmericas, Inc. | 2,528 | 58 |
Peet's Coffee & Tea Inc. | 1,021 | 25 |
Coca-Cola Bottling Co. | 403 | 22 |
4,427 | ||
Chemicals (0.4%) | ||
Energizer Holdings, Inc. | 1,929 | 114 |
Consumer Products (7.8%) | ||
Gillette Co. | 24,448 | 1,229 |
Kimberly-Clark Corp. | 12,724 | 840 |
Alberto-Culver Co. Class B | 2,281 | 119 |
Playtex Products, Inc. | 3,078 | 26 |
The Topps Co., Inc. | 2,770 | 26 |
USANA Health Sciences, Inc. | 546 | 24 |
2,264 | ||
Cosmetics (2.7%) | ||
Avon Products, Inc. | 12,578 | 538 |
Estee Lauder Cos. Class A | 3,623 | 159 |
Nu Skin Enterprises, Inc. | 1,929 | 43 |
*Elizabeth Arden, Inc. | 1,325 | 34 |
Revlon, Inc. Class A | 10,363 | 25 |
799 | ||
Drug & Grocery Store Chains (10.5%) | ||
Walgreen Co. | 26,520 | 1,136 |
CVS Corp. | 10,648 | 531 |
*The Kroger Co. | 18,918 | 340 |
*Safeway, Inc. | 12,399 | 228 |
Albertson's, Inc. | 8,811 | 197 |
Whole Foods Market, Inc. | 1,833 | 188 |
SuperValu Inc. | 3,918 | 124 |
*Rite Aid Corp. | 17,939 | 63 |
*7-Eleven, Inc. | 1,667 | 42 |
Ruddick Corp. | 1,595 | 38 |
Longs Drug Stores, Inc. | 1,353 | 37 |
Casey's General Stores, Inc. | 2,039 | 37 |
Weis Markets, Inc. | 737 | 27 |
Arden Group Inc. Class A | 250 | 24 |
The Great Atlantic & Pacific Tea Co., Inc. | 1,924 | 21 |
Ingles Markets, Inc. | 1,573 | 20 |
Wild Oats Markets Inc. | 3,053 | 20 |
Winn-Dixie Stores, Inc. | 5,208 | 3 |
3,076 | ||
Drugs & Pharmaceuticals (0.1%) | ||
*Chattem, Inc. | 896 | 33 |
Foods (16.1%) | ||
Sysco Corp. | 16,944 | 583 |
Sara Lee Corp. | 20,727 | 464 |
General Mills, Inc. | 8,739 | 458 |
ConAgra Foods, Inc. | 13,882 | 379 |
H.J. Heinz Co. | 9,337 | 351 |
Hershey Foods Corp. | 4,828 | 304 |
Kellogg Co. | 6,790 | 299 |
Wm. Wrigley Jr. Co. | 3,973 | 264 |
Kraft Foods Inc. | 7,345 | 246 |
Campbell Soup Co. | 6,348 | 176 |
*Dean Foods Co. | 4,314 | 149 |
McCormick & Co., Inc. | 3,584 | 136 |
Tyson Foods, Inc. | 6,765 | 115 |
*Smithfield Foods, Inc. | 2,878 | 98 |
J.M. Smucker Co. | 1,830 | 90 |
Hormel Foods Corp. | 2,438 | 76 |
Del Monte Foods Co. | 6,932 | 73 |
Ralcorp Holdings, Inc. | 1,178 | 55 |
*NBTY, Inc. | 2,027 | 51 |
Performance Food Group Co. | 1,759 | 48 |
Flowers Foods, Inc. | 1,573 | 47 |
Pilgrim's Pride Corp. | 1,115 | 42 |
Chiquita Brands International, Inc. | 1,826 | 42 |
Tootsie Roll Industries, Inc. | 1,029 | 31 |
Hain Celestial Group, Inc. | 1,649 | 31 |
Sanderson Farms, Inc. | 660 | 30 |
American Italian Pasta Co. | 1,091 | 30 |
J & J Snack Foods Corp. | 568 | 27 |
Lance, Inc. | 1,424 | 23 |
4,718 | ||
Manufacturing (0.2%) | ||
*Rayovac Corp. | 1,410 | 61 |
Metals & Minerals & Commodities (0.1%) | ||
WD-40 Co. | 855 | 28 |
Milling-Fruit & Grain Producers (1.5%) | ||
Archer-Daniels-Midland Co. | 14,863 | 358 |
Corn Products International, Inc. | 2,416 | 68 |
426 | ||
Miscellaneous Health Care (0.2%) | ||
*NeighborCare Inc. | 1,384 | 42 |
Multi-Sector Companies (0.2%) | ||
Lancaster Colony Corp. | 1,139 | 49 |
Retail (12.9%) | ||
Wal-Mart Stores, Inc. | 58,498 | 3,019 |
Costco Wholesale Corp. | 12,391 | 577 |
*BJ's Wholesale Club, Inc. | 2,318 | 71 |
*United Natural Foods, Inc. | 1,490 | 46 |
*Central Garden and Pet Co. | 885 | 40 |
3,753 | ||
Soap & Household Chemicals (13.7%) | ||
The Procter & Gamble Co. | 55,421 | 2,942 |
Colgate-Palmolive Co. | 13,956 | 739 |
The Clorox Co. | 4,267 | 256 |
Church & Dwight, Inc. | 2,129 | 75 |
4,012 | ||
Tobacco (12.9%) | ||
Altria Group, Inc. | 47,409 | 3,112 |
UST, Inc. | 4,636 | 253 |
Reynolds American Inc. | 2,482 | 203 |
Carolina Group | 2,359 | 77 |
Universal Corp. (VA) | 1,065 | 53 |
Vector Group Ltd. | 1,476 | 25 |
Dimon Inc. | 3,762 | 24 |
Standard Commercial Tobacco Co. | 1,156 | 22 |
3,769 | ||
23
| Shares | Market Value^ (000) |
---|---|---|
Wholesale & International Trade (0.1%) | ||
* Central European Distribution Corp. | 701 | $ 27 |
TOTAL COMMON STOCKS | ||
(Cost $27,309) | 29,195 | |
TEMPORARY CASH INVESTMENT (0.0%) | ||
Vanguard Market Liquidity Fund, 2.540%**-Note E | ||
(Cost $10) | 10,400 | 10 |
TOTAL INVESTMENTS (99.9%) | ||
(Cost $27,319) | 29,205 | |
OTHER ASSETS AND LIABILITIES-NET (0.1%) | 19 | |
NET ASSETS (100%) | $29,224 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accountsmanaged by Vanguard. Rate shown is the 7-day yield. | ||
STATEMENT OF ASSETS AND LIABILITIES | ||
Assets | ||
Investments in Securities at Value | $29,205 | |
Receivables for Capital Shares Issued | 5,543 | |
Other Assets-Note B | 192 | |
Total Assets | 34,940 | |
Liabilities | ||
Payables for Investment Securities Purchased | (5,690) | |
Other Liabilities-Note E | (26) | |
Total Liabilities | (5,716) | |
NET ASSETS (100%) | $29,224 | |
| Amount (000) | |
---|---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | ||
Paid-in Capital | $27,335 | |
Undistributed Net Investment Income | 30 | |
Accumulated Net Realized Losses | (27) | |
Unrealized Appreciation | 1,886 | |
NET ASSETS | $29,224 | |
Admiral Shares-Net Assets | ||
Applicable to 55,215 outstanding $.001 | ||
par value shares of beneficial interest | ||
(unlimited authorization) | $1,510 | |
NET ASSET VALUE PER SHARE-ADMIRAL SHARES | $27.35 | |
VIPER Shares-Net Assets | ||
Applicable to 500,000 outstanding $.001 | ||
par value shares of beneficial interest | ||
(unlimited authorization) | $27,714 | |
NET ASSET VALUE PER SHARE--VIPER SHARES | $55.43 | |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
24
Energy Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (99.6%) | ||
Air Transportation (0.1%) | ||
Offshore Logistics, Inc. | 3,344 | $ 110 |
Diversified Manufacturing (0.4%) | ||
Ashland, Inc. | 5,506 | 359 |
Energy Miscellaneous (3.3%) | ||
Valero Energy Corp. | 19,248 | 1,371 |
Sunoco, Inc. | 6,012 | 596 |
*Tesoro Petroleum Corp. | 6,335 | 234 |
Penn Virginia Corp. | 2,519 | 123 |
Veritas DGC Inc. | 4,509 | 122 |
KFX, Inc. | 6,882 | 117 |
*TETRA Technologies, Inc. | 3,547 | 111 |
Holly Corp. | 2,919 | 110 |
2,784 | ||
Machinery-Oil Well Equipment & Service (16.7%) | ||
Schlumberger Ltd. | 43,439 | 3,277 |
Halliburton Co. | 33,216 | 1,461 |
Baker Hughes, Inc. | 25,349 | 1,199 |
*Nabors Industries, Inc. | 11,703 | 672 |
BJ Services Co. | 12,773 | 638 |
*Weatherford International Ltd. | 10,564 | 630 |
Noble Corp. | 10,642 | 607 |
Smith International, Inc. | 8,435 | 542 |
Patterson-UTI Energy, Inc. | 13,792 | 345 |
*National-Oilwell, Inc. | 7,442 | 337 |
*Varco International, Inc. | 8,201 | 309 |
*Rowan Cos., Inc. | 9,497 | 301 |
*Cooper Cameron Corp. | 4,951 | 286 |
*Pride International, Inc. | 11,204 | 276 |
*Grant Prideco, Inc. | 11,261 | 272 |
*FMC Technologies Inc. | 6,272 | 217 |
Helmerich & Payne, Inc. | 5,044 | 202 |
*Cal Dive International, Inc. | 3,771 | 192 |
Key Energy Services, Inc. | 13,679 | 189 |
*Superior Energy Services, Inc. | 8,036 | 154 |
SEACOR Holdings Inc. | 2,118 | 133 |
*Hydrill Co. | 2,153 | 129 |
*Oceaneering International, Inc. | 3,227 | 129 |
CARBO Ceramics Inc. | 1,674 | 124 |
Hanover Compressor Co. | 9,324 | 123 |
Global Industries Ltd. | 11,950 | 117 |
Core Laboratories NV | 4,121 | 111 |
W-H Energy Services, Inc. | 4,172 | 110 |
Universal Compression Holdings, Inc. | 2,773 | 105 |
Input/Output, Inc. | 13,533 | 100 |
Parker Drilling Co. | 16,663 | 98 |
Oil States International, Inc. | 4,645 | 98 |
Newpark Resources, Inc. | 15,015 | 96 |
Gulf Island Fabrication, Inc. | 3,122 | 75 |
RPC Inc. | 2,856 | 75 |
Dril-Quip, Inc. | 2,369 | 73 |
Hornbeck Offshore Services, Inc. | 3,133 | 73 |
13,875 | ||
Metal Fabricating (0.3%) | ||
*Maverick Tube Corp. | 4,704 | 167 |
Lone Star Technologies, Inc. | 2,582 | 117 |
284 | ||
Offshore Drilling (3.2%) | ||
*Transocean Inc. | 24,382 | 1,182 |
GlobalSantaFe Corp. | 15,978 | 599 |
ENSCO International, Inc. | 12,287 | 495 |
Diamond Offshore Drilling, Inc. | 5,864 | 290 |
*Atwood Oceanics, Inc. | 1,827 | 126 |
2,692 | ||
Oil-Crude Producers (19.0%) | ||
Devon Energy Corp. | 34,425 | 1,611 |
Apache Corp. | 24,492 | 1,540 |
Burlington Resources, Inc. | 29,702 | 1,474 |
Anadarko Petroleum Corp. | 18,817 | 1,446 |
XTO Energy, Inc. | 19,005 | 865 |
EOG Resources, Inc. | 9,134 | 832 |
Kerr-McGee Corp. | 10,578 | 821 |
Pioneer Natural Resources Co. | 12,032 | 507 |
Chesapeake Energy Corp. | 21,103 | 458 |
*Newfield Exploration Co. | 5,044 | 375 |
Ultra Petroleum Corp. | 6,397 | 360 |
Noble Energy, Inc. | 4,873 | 330 |
Premcor, Inc. | 5,521 | 303 |
Pogo Producing Co. | 5,558 | 270 |
Patina Oil & Gas Corp. | 6,273 | 253 |
*Plains Exploration & Production Co. | 6,973 | 237 |
Forest Oil Corp. | 5,219 | 209 |
Range Resources Corp. | 7,658 | 193 |
Cabot Oil & Gas Corp. | 3,430 | 192 |
Cheniere Energy, Inc. | 2,511 | 187 |
*Unit Corp. | 4,078 | 187 |
*Cimarex Energy Co. | 4,364 | 177 |
*Denbury Resources, Inc. | 5,198 | 177 |
Vintage Petroleum, Inc. | 5,847 | 174 |
Houston Exploration Co. | 2,974 | 172 |
St. Mary Land & Exploration Co. | 3,257 | 166 |
Magnum Hunter Resources Inc. | 9,773 | 164 |
Quicksilver Resources, Inc. | 3,094 | 154 |
*Whiting Petroleum Corp. | 3,420 | 145 |
Todco | 5,698 | 144 |
*Stone Energy Corp. | 2,836 | 142 |
*Encore Acquisition Co. | 3,305 | 141 |
*Grey Wolf, Inc. | 21,247 | 138 |
Berry Petroleum Class A | 2,197 | 136 |
*Spinnaker Exploration Co. | 3,512 | 126 |
*Comstock Resources, Inc. | 4,474 | 123 |
Frontier Oil Corp. | 3,663 | 117 |
*Energy Partners, Ltd. | 4,475 | 116 |
*Swift Energy Co. | 4,143 | 113 |
*Remington Oil & Gas Corp. | 3,338 | 111 |
*Petroleum Development Corp. | 2,370 | 104 |
The Meridian Resource Corp. | 15,405 | 94 |
*Harvest Natural Resources, Inc. | 7,141 | 90 |
Endeavor International Corp. | 18,196 | 78 |
Atlas America, Inc. | 1,587 | 65 |
15,817 | ||
Oils-Integrated Domestic (14.1%) | ||
ConocoPhillips Co. | 74,043 | 8,211 |
Occidental Petroleum Corp. | 29,142 | 2,048 |
Murphy Oil Corp. | 6,542 | 654 |
Amerada Hess Corp. | 6,478 | 650 |
*KCS Energy, Inc. | 6,703 | 115 |
Delta Petroleum Corp. | 5,417 | 84 |
11,762 | ||
Oils-Integrated International (38.1%) | ||
ExxonMobil Corp. | 266,351 | 16,863 |
ChevronTexaco Corp. | 202,433 | 12,567 |
Marathon Oil Corp. | 26,191 | 1,240 |
Unocal Corp. | 20,147 | 1,090 |
31,760 | ||
Services-Commercial (0.1%) | ||
World Fuel Services Corp. | 3,674 | 105 |
Shipping (0.7%) | ||
OMI Corp. | 9,592 | 201 |
Overseas Shipholding Group Inc. | 2,704 | 176 |
25
Energy Index Fund | Shares | Market Value^ (000) |
---|---|---|
*General Maritime Corp. | 2,492 | $ 128 |
Gulfmark Offshore, Inc. | 3,107 | 85 |
590 | ||
Transportation Miscellaneous (0.3%) | ||
Tidewater Inc. | 5,476 | 226 |
Utilities-Gas Distribution (1.5%) | ||
Kinder Morgan, Inc. | 7,839 | 628 |
*Southwestern Energy Co. | 3,512 | 214 |
Western Gas Resources, Inc. | 5,285 | 196 |
Kinder Morgan Management, LLC | 4,009 | 172 |
1,210 | ||
Utilities-Gas Pipelines (1.8%) | ||
Williams Cos., Inc. | 40,623 | 765 |
El Paso Corp. | 50,761 | 626 |
Enbridge Energy Management LLC | 1,779 | 94 |
1,485 | ||
TOTAL COMMON STOCKS | ||
(Cost $70,838) | 83,059 | |
TEMPORARY CASH INVESTMENT (1.1%) | ||
Vanguard Market Liquidity Fund, 2.540%** | ||
(Cost $871) | 871,377 | 871 |
TOTAL INVESTMENTS (100.7%) | ||
(Cost $71,709) | 83,930 | |
OTHER ASSETS AND LIABILITIES (-0.7%) | ||
Other Assets-Note B | 740 | |
Liabilities | (1,307) | |
(567) | ||
NET ASSETS (100%) | $83,363 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
| Amount (000) | |
---|---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | ||
Paid-in Capital | $70,941 | |
Undistributed Net Investment Income | 141 | |
Accumulated Net Realized Gains | 60 | |
Unrealized Appreciation | 12,221 | |
NET ASSETS | $83,363 | |
Admiral Shares-Net Assets | ||
Applicable to 228,903 outstanding $.001 | ||
par value shares of beneficial interest | ||
(unlimited authorization) | $7,247 | |
NET ASSET VALUE PER SHARE-ADMIRAL SHARES | $31.66 | |
VIPER Shares-Net Assets | ||
Applicable to 1,200,000 outstanding $.001 | ||
par value shares of beneficial interest | ||
(unlimited authorization) | $76,116 | |
NET ASSET VALUE PER SHARE-VIPER SHARES | $63.43 | |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
26
Financials Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (100.0%) | ||
Banks-New York City (5.5%) | ||
JPMorgan Chase & Co. | 34,471 | $ 1,260 |
The Bank of New York Co., Inc. | 7,518 | 227 |
*Signature Bank | 113 | 3 |
1,490 | ||
Banks-Outside New York City (29.5%) | ||
Bank of America Corp. | 39,089 | 1,823 |
Wells Fargo & Co. | 16,373 | 972 |
Wachovia Corp. | 15,521 | 823 |
U.S. Bancorp | 18,069 | 538 |
��SunTrust Banks, Inc. | 3,408 | 247 |
National City Corp. | 6,025 | 216 |
Fifth Third Bancorp | 4,810 | 215 |
BB&T Corp. | 5,345 | 209 |
PNC Financial Services Group | 2,755 | 145 |
State Street Corp. | 3,226 | 141 |
Regions Financial Corp. | 4,284 | 138 |
KeyCorp | 3,720 | 123 |
North Fork Bancorp, Inc. | 4,095 | 118 |
Mellon Financial Corp. | 4,078 | 117 |
Comerica, Inc. | 1,650 | 94 |
AmSouth Bancorp | 3,410 | 85 |
Marshall & Ilsley Corp. | 1,890 | 77 |
Northern Trust Corp. | 1,685 | 71 |
M & T Bank Corp. | 676 | 67 |
Popular, Inc. | 2,462 | 65 |
Synovus Financial Corp. | 2,395 | 65 |
Banknorth Group, Inc. | 1,745 | 63 |
Zions Bancorp | 833 | 55 |
Compass Bancshares Inc. | 1,192 | 54 |
First Horizon National Corp. | 1,118 | 48 |
Huntington Bancshares Inc. | 2,104 | 47 |
Commerce Bancorp, Inc. | 726 | 44 |
Associated Banc-Corp | 1,210 | 39 |
Mercantile Bankshares Corp. | 780 | 38 |
Hibernia Corp. Class A | 1,465 | 38 |
UnionBanCal Corp. | 569 | 35 |
Doral Financial Corp. | 873 | 35 |
TCF Financial Corp. | 1,231 | 34 |
Investors Financial Services Corp. | 644 | 32 |
City National Corp. | 415 | 28 |
Commerce Bancshares, Inc. | 571 | 27 |
Fulton Financial Corp. | 1,248 | 27 |
Valley National Bancorp | 968 | 25 |
Sky Financial Group, Inc. | 901 | 25 |
Colonial BancGroup, Inc. | 1,205 | 25 |
Bank of Hawaii Corp. | 508 | 23 |
Cullen/Frost Bankers, Inc. | 446 | 21 |
The South Financial Group, Inc. | 632 | 19 |
Wilmington Trust Corp. | 570 | 19 |
FirstMerit Corp. | 742 | 19 |
East West Bancorp, Inc. | 489 | 18 |
UCBH Holdings, Inc. | 394 | 16 |
First BanCorp Puerto Rico | 345 | 16 |
Westamerica Bancorporation | 305 | 16 |
Whitney Holdings Corp. | 354 | 16 |
*Silicon Valley Bancshares | 353 | 15 |
Hudson United Bancorp | 432 | 15 |
Cathay General Bancorp | 420 | 15 |
Old National Bancorp | 724 | 15 |
BancorpSouth, Inc. | 676 | 14 |
Trustmark Corp. | 502 | 14 |
First Midwest Bancorp, Inc. | 404 | 14 |
Park National Corp. | 110 | 13 |
United Bankshares, Inc. | 374 | 13 |
International Bancshares Corp. | 341 | 12 |
Wintrust Financial Corp. | 223 | 12 |
Chittenden Corp. | 444 | 12 |
Greater Bay Bancorp | 458 | 12 |
Citizens Banking Corp. | 370 | 11 |
Texas Regional Bancshares, Inc. | 381 | 11 |
Pacific Capital Bancorp | 403 | 11 |
Susquehanna Bancshares, Inc. | 454 | 11 |
Southwest Bancorporation of Texas, Inc. | 584 | 11 |
Provident Bankshares Corp. | 322 | 11 |
Umpqua Holdings Corp. | 405 | 10 |
R & G Financial Corp. Class B | 257 | 9 |
MB Financial, Inc. | 225 | 9 |
Central Pacific Financial Co. | 251 | 9 |
Republic Bancorp, Inc. | 611 | 9 |
S & T Bancorp, Inc. | 227 | 8 |
BOK Financial Corp. | 199 | 8 |
Alabama National BanCorporation | 128 | 8 |
Corus Bankshares Inc. | 160 | 8 |
TrustCo Bank NY | 651 | 8 |
First Commonwealth Financial Corp. | 532 | 8 |
First Citizens BancShares Class A | 51 | 8 |
United Community Banks, Inc. | 298 | 7 |
CVB Financial Corp. | 381 | 7 |
Chemical Financial Corp. | 210 | 7 |
National Penn Bancshares Inc. | 265 | 7 |
First Financial Bancorp | 375 | 7 |
* Piper Jaffray Cos., Inc. | 170 | 7 |
Glacier Bancorp, Inc. | 209 | 7 |
NBT Bancorp, Inc. | 280 | 7 |
UMB Financial Corp. | 114 | 6 |
Hancock Holding Co. | 209 | 6 |
Frontier Financial Corp. | 158 | 6 |
First Charter Corp. | 261 | 6 |
Amcore Financial, Inc. | 215 | 6 |
Boston Private Financial Holdings, Inc. | 218 | 6 |
Community Bank System, Inc. | 250 | 6 |
First Financial Bankshares, Inc. | 130 | 6 |
First Community Bancorp | 133 | 6 |
Sterling Bancshares, Inc. | 389 | 6 |
Mid-State Bancshares | 206 | 5 |
PrivateBancorp, Inc. | 167 | 5 |
Main Street Banks, Inc. | 163 | 5 |
Independent Bank Corp. (MI) | 170 | 5 |
Harleysville National Corp. | 217 | 5 |
Oriental Financial Group Inc. | 189 | 5 |
Gold Banc Corp., Inc. | 345 | 5 |
Prosperity Bancshares, Inc. | 176 | 5 |
Westbanco Inc. | 176 | 5 |
Riggs National Corp. | 239 | 5 |
Bank of the Ozarks, Inc. | 132 | 5 |
City Holding Co. | 146 | 5 |
Unizan Financial Corp. | 191 | 5 |
Hanmi Financial Corp. | 252 | 4 |
First Merchants Corp. | 160 | 4 |
Sandy Spring Bancorp, Inc. | 128 | 4 |
Irwin Financial Corp. | 178 | 4 |
Old Second Bancorp, Inc. | 119 | 4 |
Community Trust Bancorp Inc. | 125 | 4 |
Independent Bank Corp. (MA) | 126 | 4 |
First Financial Corp. (IN) | 115 | 4 |
Capitol Bancorp Ltd. | 119 | 4 |
First Busey Corp. | 171 | 4 |
CoBiz Inc. | 171 | 3 |
Sterling Financial Corp. (PA) | 128 | 3 |
Integra Bank Corp. | 150 | 3 |
Washington Trust Bancorp, Inc. | 117 | 3 |
Suffolk Bancorp | 97 | 3 |
West Coast Bancorp | 132 | 3 |
Republic Bancorp, Inc. Class A | 124 | 3 |
Franklin Bank Corp. | 197 | 3 |
27
Financials Index Fund | Shares | Market Value^ (000) |
---|---|---|
Tompkins Trustco, Inc. | 75 | $ 3 |
Simmons First National Corp. | 121 | 3 |
First Community Bancshares, Inc. | 98 | 3 |
Omega Financial Corp. | 99 | 3 |
Midwest Banc Holdings, Inc. | 146 | 3 |
First Bancorp (NC) | 118 | 3 |
Columbia Banking System, Inc. | 123 | 3 |
Banner Corp. | 99 | 3 |
S.Y. Bancorp, Inc. | 114 | 3 |
Capital City Bank Group, Inc. | 67 | 3 |
Community Banks, Inc. | 105 | 3 |
U.S.B. Holding Co., Inc. | 122 | 3 |
CityBank Lynnwood WA | 83 | 3 |
Seacoast Banking Corp. of Florida | 132 | 3 |
Union Bankshares Corp. | 68 | 2 |
First Oak Brook Bancshares, Inc. | 81 | 2 |
Peoples Bancorp, Inc. | 92 | 2 |
Pennrock Financial Services Corp. | 66 | 2 |
Arrow Financial Corp. | 86 | 2 |
Camden National Corp. | 68 | 2 |
Peoples Holding Co. | 71 | 2 |
Lakeland Bancorp, Inc. | 139 | 2 |
Bank of Granite Corp. | 115 | 2 |
Farmers Capital Bank Corp. | 59 | 2 |
SCBT Financial Corp. | 69 | 2 |
Peapack Gladstone Financial Corp. | 70 | 2 |
Financial Institutions, Inc. | 92 | 2 |
Royal Bancshares of Pennsylvania, Inc. | 80 | 2 |
Virginia Financial Group, Inc. | 61 | 2 |
BancFirst Corp. | 27 | 2 |
NBC Capital Corp. | 69 | 2 |
First Source Corp. | 70 | 2 |
Texas Capital Bancshares, Inc. | 62 | 1 |
German American Bancorp | 94 | 1 |
Clifton Savings Bancorp, Inc. | 54 | 1 |
7,921 | ||
Diversified Financial Services (18.8%) | ||
Citigroup, Inc. | 50,223 | 2,397 |
American Express Co. | 10,932 | 592 |
Morgan Stanley | 9,533 | 538 |
Merrill Lynch & Co., Inc. | 8,537 | 500 |
The Goldman Sachs Group, Inc. | 3,045 | 331 |
Metropolitan Life Insurance Co. | 7,203 | 296 |
Marsh & McLennan Cos., Inc. | 4,824 | 158 |
CIT Group Inc. | 2,020 | 82 |
The Chicago Mercantile Exchange | 335 | 69 |
Leucadia National Corp. | 730 | 24 |
*CB Richard Ellis Group, Inc. | 433 | 16 |
Jones Lang Lasalle Inc. | 282 | 12 |
F.N.B. Corp. | 512 | 10 |
USI Holdings Corp. | 391 | 4 |
Greenhill & Co., Inc. | 61 | 2 |
5,031 | ||
Finance Companies (0.7%) | ||
Capital One Financial Corp. | 2,356 | 181 |
*Accredited Home Lenders Holding Co. | 170 | 7 |
Credit Acceptance Corp. | 55 | 1 |
189 | ||
Financial Data Processing Services (0.0%) | ||
*CompuCredit Corp. | 132 | 4 |
TNS Inc. | 122 | 2 |
eSPEED, Inc. Class A | 262 | 2 |
8 | ||
Financial Information Services (0.4%) | ||
Moody's Corp. | 1,232 | 103 |
Finance-Small Loan (1.0%) | ||
SLM Corp. | 4,159 | 203 |
*AmeriCredit Corp. | 1,480 | 35 |
*The First Marblehead Corp. | 280 | 19 |
Student Loan Corp. | 39 | 8 |
*Nelnet, Inc. | 174 | 6 |
*Encore Capital Group, Inc. | 140 | 3 |
274 | ||
Financial Miscellaneous (6.7%) | ||
Fannie Mae | 9,366 | 548 |
Freddie Mac | 6,663 | 413 |
MBNA Corp. | 11,746 | 298 |
Ambac Financial Group, Inc. | 1,044 | 81 |
MBIA, Inc. | 1,379 | 81 |
Fidelity National Financial, Inc. | 1,521 | 67 |
MGIC Investment Corp. | 928 | 58 |
*Providian Financial Corp. | 2,891 | 50 |
Radian Group, Inc. | 883 | 43 |
First American Corp. | 747 | 27 |
Brown & Brown, Inc. | 588 | 27 |
Nationwide Financial Services, Inc. | 556 | 20 |
MoneyGram International, Inc. | 864 | 18 |
*CapitalSource Inc. | 632 | 15 |
LandAmerica Financial Group, Inc. | 161 | 9 |
Cash America International Inc. | 231 | 7 |
Metris Cos., Inc. | 510 | 6 |
Stewart Information Services Corp. | 148 | 6 |
Financial Federal Corp. | 159 | 5 |
*Triad Guaranty, Inc. | 90 | 5 |
WFS Financial, Inc. | 80 | 4 |
Sterling Bancorp | 157 | 4 |
Advanta Corp. Class B | 151 | 4 |
WSFS Financial Corp. | 63 | 4 |
Federal Agricultural Mortgage Corp. Class C | 89 | 2 |
1,802 | ||
Insurance-Life (2.1%) | ||
Prudential Financial, Inc. | 4,945 | 282 |
The Principal Financial Group, Inc. | 2,970 | 116 |
Jefferson-Pilot Corp. | 1,344 | 66 |
*Conseco, Inc. | 1,414 | 27 |
AmerUs Group Co. | 376 | 18 |
Delphi Financial Group, Inc. | 280 | 12 |
The Phoenix Cos., Inc. | 827 | 11 |
Scottish Re Group Ltd. | 302 | 7 |
American Equity Investment Life Holding Co. | 349 | 4 |
Presidential Life Corp. | 243 | 4 |
National Western Life Insurance Co. Class A | 21 | 4 |
*Universal American Financial Corp. | 219 | 3 |
Citizens, Inc. | 314 | 2 |
556 | ||
Insurance-Multiline (12.0%) | ||
American International Group, Inc. | 21,424 | 1,431 |
Allstate Corp. | 6,308 | 339 |
St. Paul Travelers Cos., Inc. | 6,470 | 248 |
The Hartford Financial Services Group Inc. | 2,860 | 206 |
AFLAC Inc. | 4,894 | 188 |
Loews Corp. | 1,161 | 83 |
Lincoln National Corp. | 1,694 | 79 |
Aon Corp. | 2,584 | 63 |
Cincinnati Financial Corp. | 1,377 | 62 |
SAFECO Corp. | 1,225 | 58 |
Torchmark Corp. | 1,056 | 55 |
UnumProvident Corp. | 2,792 | 47 |
Old Republic International Corp. | 1,686 | 40 |
Assurant, Inc. | 1,163 | 40 |
Genworth Financial Inc. | 1,412 | 40 |
Markel Corp. | 85 | 30 |
Arthur J. Gallagher & Co. | 903 | 27 |
Protective Life Corp. | 656 | 26 |
StanCorp Financial Group, Inc. | 284 | 25 |
Unitrin, Inc. | 459 | 22 |
Allmerica Financial Corp. | 532 | 19 |
28
| Shares | Market Value^ (000) |
---|---|---|
Reinsurance Group of America, Inc. | 330 | $ 15 |
American Financial Group, Inc. | 427 | 13 |
Hilb, Rogal and Hamilton Co. | 291 | 10 |
Assured Guaranty Ltd. | 519 | 10 |
Zenith National Insurance Corp. | 158 | 8 |
UICI | 286 | 8 |
Horace Mann Educators Corp. | 377 | 7 |
Aspen Insurance Holdings Ltd. | 207 | 5 |
Max Re Capital Ltd. | 212 | 5 |
Alfa Corp. | 325 | 5 |
Quanta Capital Holdings Ltd. | 499 | 5 |
FBL Financial Group, Inc. Class A | 122 | 3 |
I Surety Corp. | 133 | 2 |
Crawford & Co. Class B | 188 | 1 |
3,225 | ||
Insurance-Property-Casualty (4.0%) | ||
Progressive Corp. of Ohio | 1,854 | 161 |
The Chubb Corp. | 1,866 | 148 |
ACE Ltd. | 2,737 | 122 |
XL Capital Ltd. Class A | 1,354 | 101 |
White Mountains Insurance Group Inc. | 79 | 52 |
Everest Re Group, Ltd. | 545 | 47 |
The PMI Group Inc. | 932 | 38 |
W.R. Berkley Corp. | 720 | 37 |
PartnerRe Ltd. | 527 | 33 |
RenaissanceRe Holdings Ltd. | 609 | 29 |
HCC Insurance Holdings, Inc. | 666 | 25 |
Axis Capital Holdings Ltd. | 829 | 23 |
Montpelier Re Holdings Ltd. | 489 | 20 |
Transatlantic Holdings, Inc. | 255 | 17 |
Fremont General Corp. | 653 | 16 |
Erie Indemnity Co. Class A | 298 | 15 |
IPC Holdings Ltd. | 362 | 15 |
Commerce Group, Inc. | 221 | 15 |
Mercury General Corp. | 262 | 14 |
Philadelphia Consolidated Holding Corp. | 186 | 14 |
*Ohio Casualty Corp. | 535 | 13 |
*Arch Capital Group Ltd. | 304 | 13 |
Platinum Underwriters Holdings, Ltd. | 400 | 12 |
Endurance Specialty Holdings Ltd. | 311 | 11 |
Selective Insurance Group | 236 | 11 |
ProAssurance Corp. | 253 | 10 |
R.L.I. Corp. | 217 | 9 |
*Danielson Holdings Corp. | 537 | 9 |
PXRE Group Ltd. | 230 | 6 |
Infinity Property & Casualty Corp. | 183 | 6 |
Argonaut Group, Inc. | 226 | 5 |
United Fire & Casualty Co. | 165 | 5 |
Midland Co. | 145 | 4 |
Odyssey Re Holdings Corp. | 177 | 4 |
Direct General Corp. | 153 | 3 |
Navigators Group, Inc. | 101 | 3 |
Harleysville Group, Inc. | 134 | 3 |
State Auto Financial Corp. | 95 | 3 |
Bristol West Holdings, Inc. | 156 | 3 |
United America Indemnity, Ltd. | 139 | 3 |
Baldwin & Lyons, Inc. Class B | 98 | 2 |
PMA Capital Corp. Class A | 261 | 2 |
1,082 | ||
Investment Management Companies (1.1%) | ||
T. Rowe Price Group Inc. | 1,122 | 69 |
Allied Capital Corp. | 1,294 | 35 |
Janus Capital Group Inc. | 2,270 | 32 |
Eaton Vance Corp. | 1,168 | 31 |
SEI Corp. | 775 | 29 |
Federated Investors, Inc. | 807 | 24 |
*Affiliated Managers Group, Inc. | 277 | 18 |
Waddell & Reed Financial, Inc. | 833 | 17 |
BlackRock, Inc. | 189 | 15 |
National Financial Partners Corp. | 184 | $7 |
MCG Capital Corp. | 329 | 6 |
Gabelli Asset Management Inc. | 61 | 3 |
Capital Southwest Corp. | 34 | 3 |
289 | ||
Multi-Sector Companies (0.9%) | ||
Berkshire Hathaway Inc. Class B | 78 | 235 |
Real Estate (0.3%) | ||
The St. Joe Co. | 709 | 52 |
Forest City Enterprise Class A | 288 | 18 |
Trammell Crow Co. | 320 | 6 |
*Tejon Ranch Co. | 80 | 4 |
80 | ||
Real Estate Investment Trusts (9.4%) | ||
Simon Property Group, Inc. REIT | 2,060 | 128 |
Equity Office Properties Trust REIT | 3,948 | 119 |
Equity Residential REIT | 2,745 | 90 |
Vornado Realty Trust REIT | 1,109 | 76 |
General Growth Properties Inc. REIT | 2,043 | 71 |
ProLogis REIT | 1,776 | 71 |
Plum Creek Timber Co. Inc. REIT | 1,794 | 67 |
Archstone-Smith Trust REIT | 1,932 | 65 |
Boston Properties, Inc. REIT | 1,005 | 60 |
Host Marriott Corp. REIT | 3,205 | 51 |
Kimco Realty Corp. REIT | 921 | 49 |
Avalonbay Communities, Inc. REIT | 695 | 48 |
Public Storage, Inc. REIT | 835 | 46 |
Duke Realty Corp. REIT | 1,392 | 44 |
Developers Diversified Realty Corp. REIT | 1,004 | 42 |
iStar Financial Inc. REIT | 910 | 39 |
Apartment Investment & Management Co. | ||
Class A REIT | 932 | 36 |
Liberty Property Trust REIT | 818 | 34 |
The Macerich Co. REIT | 577 | 33 |
Health Care Properties Investors REIT | 1,276 | 32 |
AMB Property Corp. REIT | 826 | 32 |
Regency Centers Corp. REIT | 608 | 31 |
Weingarten Realty Investors REIT | 831 | 31 |
Mills Corp. REIT | 532 | 29 |
United Dominion Realty Trust REIT | 1,282 | 28 |
Catellus Development Corp. REIT | 980 | 27 |
Mack-Cali Realty Corp. REIT | 594 | 26 |
Hospitality Properties Trust REIT | 626 | 26 |
New Plan Excel Realty Trust REIT | 971 | 25 |
Federal Realty Investment Trust REIT | 498 | 25 |
Rayonier Inc. REIT | 486 | 23 |
Reckson Associates Realty Corp. REIT | 757 | 23 |
Thornburg Mortgage, Inc. REIT | 780 | 22 |
Friedman, Billings, Ramsey Group, Inc. REIT | 1,197 | 22 |
Arden Realty Group, Inc. REIT | 642 | 22 |
SL Green Realty Corp. REIT | 390 | 22 |
CBL & Associates Properties, Inc. REIT | 291 | 22 |
Annaly Mortgage Management Inc. REIT | 1,121 | 21 |
New Century REIT, Inc. | 422 | 21 |
Ventas, Inc. REIT | 812 | 21 |
HRPT Properties Trust REIT | 1,638 | 21 |
Pan Pacific Retail Properties, Inc. REIT | 349 | 20 |
CenterPoint Properties Corp. REIT | 454 | 20 |
BRE Properties Inc. Class A REIT | 483 | 19 |
Realty Income Corp. REIT | 762 | 18 |
Camden Property Trust REIT | 523 | 24 |
Healthcare Realty Trust Inc. REIT | 483 | 18 |
CarrAmerica Realty Corp. REIT | 568 | 18 |
Health Care Inc. REIT | 505 | 17 |
First Industrial Realty Trust REIT | 405 | 17 |
Shurgard Storage Centers, Inc. Class A REIT | 391 | 16 |
American Financial Realty Trust REIT | 1,058 | 16 |
Prentiss Properties Trust REIT | 420 | 15 |
29
| Shares | Market Value^ (000) |
---|---|---|
Trizec Properties, Inc. REIT | 818 | $ 15 |
Brandywine Realty Trust REIT | 495 | 15 |
Capital Automotive REIT | 432 | 14 |
Crescent Real Estate, Inc. REIT | 868 | 14 |
Nationwide Health Properties, Inc. REIT | 683 | 14 |
Essex Property Trust, Inc. REIT | 195 | 14 |
Impac Mortgage Holdings, Inc. REIT | 718 | 14 |
Taubman Co. REIT | 462 | 13 |
Home Properties, Inc. REIT | 313 | 13 |
Alexandria Real Estate Equities, Inc. REIT | 188 | 13 |
Pennsylvania REIT | 309 | 13 |
Washington REIT | 428 | 13 |
Kilroy Realty Corp. REIT | 293 | 12 |
Redwood Trust, Inc. REIT | 202 | 12 |
Highwood Properties, Inc. REIT | 438 | 11 |
Maguire Properties, Inc. REIT | 422 | 11 |
Cousins Properties, Inc. REIT | 406 | 11 |
Newcastle Investment Corp. REIT | 356 | 11 |
American Home Mortgage Investment Corp. REIT | 351 | 11 |
Post Properties, Inc. REIT | 336 | 11 |
Lexington Corporate Properties Trust REIT | 474 | 10 |
Senior Housing Properties Trust REIT | 557 | 10 |
Inland Real Estate Corp. REIT | 619 | 10 |
Gables Residential Trust REIT | 281 | 10 |
Novastar Financial, Inc. REIT | 258 | 9 |
Corporate Office Properties Trust, Inc. REIT | 336 | 9 |
Entertainment Properties Trust REIT | 215 | 9 |
EastGroup Properties, Inc. REIT | 220 | 9 |
Colonial Properties Trust REIT | 229 | 8 |
LaSalle Hotel Properties REIT | 276 | 8 |
Saxon Inc. REIT | 462 | 8 |
Commercial Net Lease Realty REIT | 438 | 8 |
Glimcher Realty Trust REIT | 312 | 8 |
Heritage Property Investment Trust REIT | 261 | 8 |
PS Business Parks, Inc. REIT | 179 | 7 |
CRT Properties, Inc. REIT | 323 | 7 |
Glenborough Realty Trust, Inc. REIT | 357 | 7 |
Equity One, Inc. REIT | 332 | 7 |
Equity Lifestyle Properties, Inc. REIT | 193 | 6 |
MFA Mortgage Investments, Inc. REIT | 761 | 6 |
*FelCor Lodging Trust, Inc. REIT | 504 | 6 |
MeriStar Hospitality Corp. REIT | 840 | 6 |
Mid-America Apartment Communities, Inc. REIT | 161 | 6 |
National Health Investors REIT | 229 | 6 |
Anthracite Capital Inc. REIT | 488 | 6 |
Omega Healthcare Investors, Inc. REIT | 495 | 6 |
Sun Communities, Inc. REIT | 162 | 6 |
RAIT Investment Trust REIT | 209 | 6 |
AMLI Residential Properties Trust REIT | 203 | 6 |
Equity Inns, Inc. REIT | 497 | 6 |
Tanger Factory Outlet Centers, Inc. REIT | 228 | 5 |
Getty Realty Holding Corp. REIT | 186 | 5 |
Sovran Self Storage, Inc. REIT | 121 | 5 |
Kramont Realty Trust REIT | 212 | 5 |
Cornerstone Realty Income Trust, Inc. REIT | 484 | 5 |
Saul Centers, Inc. REIT | 128 | 4 |
Acadia Realty Trust REIT | 276 | 4 |
Innkeepers USA Trust REIT | 328 | 4 |
Parkway Properties Inc. REIT | 93 | 4 |
Ramco-Gershenson Properties Trust REIT | 148 | 4 |
Luminent Mortgage Capital, Inc. REIT | 360 | 4 |
Highland Hospitality Corp. REIT | 390 | 4 |
Trustreet Properties, Inc. | 220 | 4 |
Town & Country Trust REIT | 144 | 4 |
Global Signal, Inc. REIT | 124 | 4 |
Affordable Residential Communities REIT | 292 | 4 |
Strategic Hotel Capital, Inc. REIT | 212 | 3 |
Bedford Property Investors, Inc. REIT | 144 | 3 |
Anworth Mortgage Asset Corp. REIT | 343 | 3 |
Investors Real Estate Trust REIT | 333 | 3 |
Arbor Realty Trust, Inc. REIT | 130 | 3 |
Universal Health Realty Income REIT | 101 | 3 |
Capital Lease Funding, Inc. REIT | 228 | 3 |
Urstadt Biddle Properties Class A REIT | 164 | 3 |
Mission West Properties Inc. REIT | 158 | 2 |
Urstadt Biddle Properties REIT | 55 | 1 |
2,514 | ||
Rent & Lease Services-Commercial (0.0%) | ||
GATX Corp. | 420 | 13 |
Savings & Loan (4.0%) | ||
Washington Mutual, Inc. | 8,391 | 352 |
Golden West Financial Corp. | 2,534 | 157 |
Sovereign Bancorp, Inc. | 3,585 | 82 |
New York Community Bancorp, Inc. | 2,295 | 42 |
Independence Community Bank Corp. | 687 | 27 |
Hudson City Bancorp, Inc. | 653 | 24 |
Astoria Financial Corp. | 637 | 24 |
Webster Financial Corp. | 520 | 23 |
IndyMac Bancorp, Inc. | 601 | 22 |
Washington Federal Inc. | 870 | 21 |
NewAlliance Bancshares, Inc. | 1,124 | 16 |
First Niagara Financial Group, Inc. | 1,090 | 15 |
People's Bank | 360 | 14 |
W Holding Co., Inc. | 1,137 | 13 |
Downey Financial Corp. | 206 | 13 |
MAF Bancorp, Inc. | 295 | 13 |
Provident Financial Services Inc. | 624 | 11 |
Commercial Federal Corp. | 380 | 10 |
Westcorp, Inc. | 224 | 10 |
Capitol Federal Financial | 250 | 9 |
Commercial Capital Bancorp, Inc. | 404 | 9 |
BankAtlantic Bancorp, Inc. Class A | 465 | 8 |
Bank Mutual Corp. | 691 | 8 |
*Sterling Financial Corp. | 216 | 8 |
Brookline Bancorp, Inc. | 513 | 8 |
First Federal Financial Corp. | 146 | 7 |
*BankUnited Financial Corp. | 253 | 7 |
First Republic Bank | 131 | 7 |
Harbor Florida Bancshares, Inc. | 203 | 7 |
PFF Bancorp, Inc. | 143 | 6 |
Flagstar Bancorp, Inc. | 274 | 6 |
Anchor Bancorp Wisconsin Inc. | 201 | 6 |
Provident Bancorp, Inc. | 426 | 5 |
Fidelity Bankshares, Inc. | 208 | 5 |
Dime Community Bancshares | 321 | 5 |
Partners Trust Financial Group, Inc. | 446 | 5 |
TierOne Corp. | 187 | 5 |
KNBT Bancorp Inc. | 284 | 5 |
Northwest Bancorp, Inc. | 210 | 5 |
Great Southern Bancorp, Inc. | 114 | 4 |
Net.Bank, Inc. | 421 | 4 |
IBERIABANK Corp. | 60 | 4 |
United Community Financial Corp. | 290 | 3 |
First Financial Holdings, Inc. | 112 | 3 |
First Indiana Corp. | 128 | 3 |
Flushing Financial Corp. | 163 | 3 |
ITLA Capital Corp. | 56 | 3 |
*Ocwen Financial Corp. | 336 | 3 |
OceanFirst Financial Corp. | 114 | 3 |
First Place Financial Corp. | 116 | 2 |
Citizens 1st Bancorp, Inc. | 73 | 2 |
Pennfed Financial Services, Inc. | 117 | 2 |
Charter Financial Corp. | 35 | 1 |
1,060 | ||
Securities Brokers & Services (3.6%) | ||
Lehman Brothers Holdings, Inc. | 2,212 | 202 |
Countrywide Financial Corp. | 5,605 | 195 |
30
| Shares | Market Value^ (000) |
---|---|---|
Charles Schwab Corp. | 9,776 | $ 103 |
Franklin Resources Corp. | 1,440 | 101 |
Bear Stearns Co., Inc. | 942 | 94 |
Legg Mason Inc. | 984 | 79 |
*E*TRADE Group, Inc. | 3,439 | 46 |
A.G. Edwards & Sons, Inc. | 731 | 32 |
American Capital Strategies, Ltd. | 875 | 30 |
Ameritrade Holding Corp. | 2,250 | 24 |
Jefferies Group, Inc. | 476 | 18 |
Raymond James Financial, Inc. | 532 | 16 |
Knight Trading Group, Inc. | 987 | 10 |
*Investment Technology Group, Inc. | 404 | 8 |
Nuveen Investments, Inc. Class A | 167 | 7 |
Instinet Group Inc. | 815 | 5 |
LaBranche & Co. Inc. | 515 | 5 |
SWS Group, Inc. | 146 | 3 |
Advanta Corp. Class A | 79 | 2 |
980 | ||
Services-Commercial (0.0%) | ||
Clark, Inc. | 153 | 3 |
TOTAL COMMON STOCKS | ||
(Cost $26,480) | 26,855 | |
TEMPORARY CASH INVESTMENTS (0.3%) | ||
Vanguard Market Liquidity Fund, 2.540%** | 14,821 | 15 |
Vanguard Market Liquidity Fund, 2.540%** | ||
-Note E | 56,700 | 57 |
TOTAL TEMPORARY CASH INVESTMENTS | ||
(Cost $72) | 72 | |
TOTAL INVESTMENTS (100.3%) | ||
(Cost $26,552) | 26,927 | |
OTHER ASSETS AND LIABILITIES (-0.3%) | ||
Other Assets--Note B | 272 | |
Liabilities--Note E | (347) | |
(75) | ||
NET ASSETS (100%) | $26,852 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $26,483 |
Overdistributed Net Investment Income | (48) |
Accumulated Net Realized Gains | 42 |
Unrealized Appreciation | 375 |
NET ASSETS | $26,852 |
Admiral Shares-Net Assets | |
Applicable to 32,519 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $847 |
NET ASSET VALUE PER SHARE-ADMIRAL SHARES | $26.07 |
VIPER Shares-Net Assets | |
Applicable to 500,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $26,005 |
NET ASSET VALUE PER SHARE-VIPER SHARES | $52.01 |
See Note C in Notes to Financial Statementsfor the tax-basis components of net assets. |
31
Health Care Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (99.9%) | ||
Biotech Research & Production (12.1%) | ||
*Amgen, Inc. | 96,200 | $ 5,927 |
*Genentech, Inc. | 35,851 | 1,692 |
Baxter International, Inc. | 46,741 | 1,667 |
*Genzyme Corp.-General Division | 18,812 | 1,055 |
*Biogen Idec Inc. | 25,224 | 975 |
Celgene Corp. | 12,357 | 338 |
*Chiron Corp. | 8,438 | 300 |
*Invitrogen Corp. | 3,671 | 257 |
ImClone Systems, Inc. | 5,044 | 223 |
*Cephalon, Inc. | 4,427 | 217 |
*Charles River Laboratories, Inc. | 4,695 | 216 |
*OSI Pharmaceuticals, Inc. | 3,876 | 212 |
*Millennium Pharmaceuticals, Inc. | 22,179 | 191 |
*Millipore Corp. | 3,670 | 166 |
*Martek Biosciences Corp. | 2,414 | 162 |
*IDEXX Laboratories Corp. | 2,510 | 139 |
*Neurocrine Biosciences, Inc. | 2,782 | 111 |
*ICOS Corp. | 4,685 | 104 |
*Protein Design Labs, Inc. | 6,898 | 103 |
*Human Genome Sciences, Inc. | 8,982 | 100 |
*Vicuron Pharmaceuticals Inc. | 4,409 | 77 |
*Telik, Inc. | 3,902 | 74 |
*Applera Corp.-Celera Genomics Group | 5,633 | 63 |
*Serologicals Corp. | 2,385 | 58 |
Nabi Biopharmaceuticals | 4,456 | 57 |
Integra LifeSciences Holdings | 1,385 | 51 |
Myriad Genetics, Inc. | 2,366 | 51 |
*Abgenix, Inc. | 6,184 | 51 |
Incyte Corp. | 5,728 | 50 |
Alexion Pharmaceuticals, Inc. | 2,136 | 50 |
*Transkaryotic Therapies, Inc. | 2,134 | 49 |
ArthroCare Corp. | 1,705 | 49 |
Encysive Pharmaceuticals, Inc. | 4,441 | 49 |
Cell Therapeutics, Inc. | 4,585 | 45 |
*NPS Pharmaceuticals Inc. | 2,954 | 42 |
Cubist Pharmaceuticals, Inc. | 3,840 | 40 |
Exelixis, Inc. | 5,330 | 38 |
*Enzon Pharmaceuticals, Inc. | 3,344 | 36 |
*Zymogenetics, Inc. | 1,763 | 35 |
*Digene Corp. | 1,266 | 30 |
*Kensey Nash Corp. | 821 | 27 |
*Keryx Biopharmaceuticals, Inc. | 1,912 | 25 |
*InterMune Inc. | 2,233 | 25 |
Barrier Therapeutics Inc. | 1,334 | 23 |
ARIAD Pharmaceuticals, Inc. | 3,650 | 23 |
*Tanox, Inc. | 2,002 | 22 |
Geron Corp. | 3,116 | 22 |
Discovery Laboratories, Inc. | 3,611 | 21 |
Maxygen Inc. | 1,797 | 17 |
Lexicon Genetics Inc. | 2,922 | 17 |
*Cell Genesys, Inc. | 2,266 | 14 |
CuraGen Corp. | 2,290 | 13 |
Trimeris, Inc. | 903 | 12 |
Albany Molecular Research, Inc. | 1,103 | 11 |
Antigenics, Inc. | 1,507 | 10 |
Corixa Corp. | 2,620 | 10 |
Diversa Corp. | 1,390 | 9 |
Genta Inc. | 5,819 | 7 |
XOMA Ltd. | 4,142 | 6 |
15,464 | ||
Computer Services Software & Systems (0.1%) | ||
*Dendrite International, Inc. | 3,115 | 48 |
*The TriZetto Group, Inc. | 2,599 | 23 |
71 | ||
Consumer Products (0.1%) | ||
Matthews International Corp. | 2,550 | 89 |
Drugs & Pharmaceuticals (51.0%) | ||
Pfizer Inc. | 570,845 | 15,008 |
Johnson & Johnson | 225,038 | 14,762 |
Merck & Co., Inc. | 168,184 | 5,331 |
Abbott Laboratories | 112,253 | 5,163 |
Eli Lilly & Co. | 77,282 | 4,328 |
Wyeth | 101,180 | 4,130 |
Bristol-Myers Squibb Co. | 147,519 | 3,692 |
Schering-Plough Corp. | 111,451 | 2,112 |
Cardinal Health, Inc. | 32,766 | 1,918 |
*Forest Laboratories, Inc. | 27,987 | 1,195 |
*Gilead Sciences, Inc. | 32,873 | 1,136 |
Allergan, Inc. | 10,202 | 767 |
AmerisourceBergen Corp. | 8,599 | 515 |
*Sepracor Inc. | 7,678 | 495 |
*MedImmune Inc. | 18,745 | 451 |
Mylan Laboratories, Inc. | 20,172 | 355 |
*Hospira, Inc. | 11,163 | 330 |
*Barr Pharmaceuticals Inc. | 6,591 | 315 |
*Watson Pharmaceuticals, Inc. | 7,975 | 253 |
IVAX Corp. | 14,595 | 233 |
*King Pharmaceuticals, Inc. | 18,432 | 176 |
Valeant Pharmaceuticals International | 6,917 | 168 |
*Amylin Pharmaceuticals, Inc. | 6,653 | 143 |
Medicis Pharmaceutical Corp. | 4,103 | 142 |
*Andrx Group | 5,623 | 126 |
*MGI Pharma, Inc. | 5,479 | 125 |
*Endo Pharmaceuticals Holdings, Inc. | 5,075 | 114 |
*Nektar Therapeutics | 6,488 | 112 |
*PAR Pharmaceutical Cos. Inc. | 2,661 | 98 |
American Pharmaceuticals Partners, Inc. | 1,684 | 88 |
Perrigo Co. | 4,954 | 87 |
*Alkermes, Inc. | 6,884 | 80 |
*The Medicines Co. | 3,301 | 77 |
*United Therapeutics Corp. | 1,654 | 75 |
*Onyx Pharmaceuticals, Inc. | 2,589 | 75 |
*Vertex Pharmaceuticals, Inc. | 6,147 | 71 |
*Connetics Corp. | 2,712 | 67 |
*Priority Healthcare Corp. Class B | 2,885 | 66 |
*Eon Labs, Inc. | 2,065 | 63 |
*Pharmion Corp. | 1,763 | 60 |
*Ligand Pharmaceuticals Inc. Class B | 5,712 | 56 |
*CV Therapeutics, Inc. | 2,441 | 54 |
*K-V Pharmaceutical Co. Class A | 2,344 | 51 |
*Medarex, Inc. | 5,843 | 49 |
*AtheroGenics, Inc. | 2,916 | 48 |
Eyetech Pharmaceuticals Inc. | 1,452 | 48 |
*Impax Laboratories, Inc. | 2,740 | 47 |
*Kos Pharmaceuticals, Inc. | 1,364 | 45 |
*Salix Pharmaceuticals, Ltd. | 2,564 | 42 |
Alpharma, Inc. Class A | 3,119 | 41 |
*First Horizon Pharmaceutical Corp. | 2,203 | 36 |
Enzo Biochem, Inc. | 2,055 | 33 |
*Noven Pharmaceuticals, Inc. | 1,812 | 30 |
BioMarin Pharmaceutical Inc. | 4,938 | 27 |
Inspire Pharmaceuticals, Inc. | 3,236 | 26 |
Adolor Corp. | 2,891 | 25 |
NitroMed, Inc. | 1,164 | 25 |
*Dendreon Corp. | 3,819 | 25 |
*ImmunoGen, Inc. | 3,125 | 18 |
*Regeneron Pharmaceuticals, Inc. | 2,889 | 18 |
NeoPharm, Inc. | 1,457 | 15 |
Isis Pharmaceuticals, Inc. | 2,715 | 11 |
K-V Pharmaceutical Co. Class B | 428 | 10 |
Santarus Inc. | 1,295 | 9 |
Pozen Inc. | 1,116 | 7 |
32
| Shares | Market Value^ (000) |
---|---|---|
*SciClone Pharmaceuticals, Inc. | 2,264 | $ 7 |
Lannett Company, Inc. | 322 | 2 |
GTx, Inc. | 136 | 1 |
65,308 | ||
Electronics-Gauge & Meter (0.3%) | ||
*Thermo Electron Corp. | 12,291 | 338 |
Electronics-Medical Systems (4.7%) | ||
Medtronic, Inc. | 91,598 | 4,774 |
*Varian Medical Systems, Inc. | 10,246 | 368 |
*Affymetrix, Inc. | 4,661 | 199 |
*Intuitive Surgical, Inc. | 2,332 | 110 |
VISX Inc. | 3,810 | 92 |
*Haemonetics Corp. | 1,971 | 82 |
*eResearch Technology, Inc. | 3,804 | 59 |
*Hologic, Inc. | 1,588 | 59 |
Analogic Corp. | 913 | 39 |
Datascope Corp. | 978 | 34 |
CTI Molecular Imaging, Inc. | 1,982 | 33 |
Wilson Greatbatch Technologies, Inc. | 1,693 | 30 |
Zoll Medical Corp. | 764 | 23 |
EPIX Pharmaceuticals, Inc. | 1,819 | 15 |
CardioDynamics International Corp. | 2,140 | 9 |
*Possis Medical Inc. | 942 | 9 |
*Bruker BioSciences Corp. | 1,870 | 7 |
5,942 | ||
Electronics-Technology (0.2%) | ||
PerkinElmer, Inc. | 9,310 | 207 |
Intermagnetics General Corp. | 2,140 | 56 |
263 | ||
Financial Data Processing Services (0.0%) | ||
NDCHealth Corp. | 2,751 | 43 |
Funeral Parlors & Cemeteries (0.2%) | ||
*Service Corp. International | 24,974 | 188 |
Stewart Enterprises, Inc. Class A | 7,652 | 49 |
237 | ||
Health & Personal Care (4.7%) | ||
*WellPoint Inc. | 22,511 | 2,748 |
*Medco Health Solutions, Inc. | 20,713 | 920 |
McKesson Corp. | 21,073 | 787 |
Express Scripts Inc. | 4,606 | 347 |
*Lincare Holdings, Inc. | 7,650 | 310 |
Omnicare, Inc. | 7,977 | 275 |
*Accredo Health, Inc. | 3,782 | 161 |
*Apria Healthcare Group Inc. | 3,661 | 119 |
Province Healthcare Co. | 3,838 | 89 |
*IDX Systems Corp. | 1,508 | 52 |
*LabOne, Inc. | 1,384 | 50 |
*Odyssey Healthcare, Inc. | 2,683 | 30 |
*Gentiva Health Services, Inc. | 1,782 | 30 |
VistaCare, Inc. | 1,273 | 22 |
Symbion, Inc. | 594 | 13 |
*Alliance Imaging, Inc. | 828 | 9 |
5,962 | ||
Health Care Facilities (4.0%) | ||
HCA Inc. | 28,797 | 1,360 |
Quest Diagnostics, Inc. | 6,342 | 630 |
*Laboratory Corp. of America Holdings | 10,458 | 501 |
Health Management Associates Class A | 18,353 | 422 |
*Tenet Healthcare Corp. | 35,142 | 383 |
*DaVita, Inc. | 7,513 | 317 |
*Triad Hospitals, Inc. | 5,863 | 256 |
Manor Care, Inc. | 6,689 | 228 |
*Renal Care Group, Inc. | 5,136 | 202 |
*Pharmaceutical Product Development, Inc. | 3,943 | 168 |
*LifePoint Hospitals, Inc. | 2,864 | 115 |
*Beverly Enterprises, Inc. | 8,323 | 100 |
*Kindred Healthcare, Inc. | 2,840 | 93 |
*United Surgical Partners International, Inc. | 2,162 | 89 |
*American Healthways Inc. | 2,380 | 81 |
Sunrise Senior Living, Inc. | 1,411 | 67 |
*Genesis Healthcare Corp. | 1,318 | 54 |
National Healthcare Corp. | 670 | 25 |
Specialty Laboratories, Inc. | 486 | 5 |
5,096 | ||
Health Care Management Services (8.1%) | ||
UnitedHealth Group Inc. | 49,509 | 4,513 |
Aetna Inc. | 11,152 | 1,628 |
*Caremark Rx, Inc. | 32,663 | 1,250 |
IMS Health, Inc. | 17,600 | 429 |
*PacifiCare Health Systems, Inc. | 6,436 | 409 |
*Humana Inc. | 11,323 | 377 |
*Health Net Inc. | 8,536 | 255 |
*Community Health Systems, Inc. | 6,535 | 212 |
Universal Health Services Class B | 4,037 | 191 |
*WebMD Corp. | 22,730 | 171 |
*AMERIGROUP Corp. | 3,735 | 149 |
*Cerner Corp. | 2,269 | 118 |
*Sierra Health Services, Inc. | 1,837 | 113 |
*Pediatrix Medical Group, Inc. | 1,633 | 112 |
*Centene Corp. | 3,007 | 100 |
*AmSurg Corp. | 2,341 | 57 |
*Wellcare Group Inc. | 1,680 | 53 |
*Molina Healthcare Inc. | 1,110 | 50 |
Eclipsys Corp. | 3,087 | 48 |
*Per-Se Technologies, Inc. | 2,367 | 36 |
Hooper Holmes, Inc. | 4,707 | 21 |
OCA Inc. | 3,674 | 18 |
Computer Programs and Systems, Inc. | 325 | 8 |
*CorVel Corp. | 340 | 8 |
10,326 | ||
Identification Control & Filter Devices (0.3%) | ||
Waters Corp. | 9,162 | 448 |
Insurance-Multiline (0.8%) | ||
CIGNA Corp. | 10,156 | 922 |
*WellChoice Inc. | 2,519 | 130 |
HealthExtras, Inc. | 1,743 | 28 |
1,080 | ||
Medical & Dental Instruments & Supplies (11.6%) | ||
Guidant Corp. | 24,160 | 1,773 |
Zimmer Holdings, Inc. | 18,642 | 1,601 |
Boston Scientific Corp. | 47,893 | 1,564 |
Becton, Dickinson & Co. | 18,910 | 1,132 |
*St. Jude Medical, Inc. | 26,715 | 1,045 |
Stryker Corp. | 19,734 | 980 |
Biomet, Inc. | 18,165 | 767 |
C.R. Bard, Inc. | 7,894 | 525 |
*Patterson Cos | 7,712 | 383 |
Beckman Coulter, Inc. | 4,591 | 323 |
DENTSPLY International Inc. | 5,547 | 305 |
Bausch & Lomb, Inc. | 4,035 | 286 |
Cooper Cos., Inc. | 3,098 | 255 |
*Henry Schein, Inc. | 3,159 | 229 |
*Kinetic Concepts, Inc. | 3,089 | 202 |
*Cytyc Corp. | 8,535 | 195 |
*Edwards Lifesciences Corp. | 4,451 | 191 |
*Gen-Probe Inc. | 3,678 | 187 |
*INAMED Corp. | 2,691 | 183 |
*Dade Behring Holdings Inc. | 2,904 | 182 |
*Respironics, Inc. | 2,720 | 157 |
*ResMed Inc. | 2,472 | 146 |
*STERIS Corp. | 5,350 | 132 |
Mentor Corp. | 3,301 | 114 |
*Sybron Dental Specialties, Inc. | 2,984 | 107 |
*Advanced Medical Optics, Inc. | 2,747 | 104 |
*Immucor Inc. | 3,494 | 104 |
33
| Shares | Market Value^ (000) |
---|---|---|
*Techne Corp. | 2,999 | $ 102 |
Invacare Corp. | 2,064 | 97 |
*American Medical Systems Holdings, Inc. | 2,361 | 94 |
Owens & Minor, Inc. Holding Co. | 3,013 | 84 |
Diagnostic Products Corp. | 1,715 | 78 |
PolyMedica Corp. | 2,134 | 73 |
Sola International Inc. | 2,543 | 71 |
*Ventana Medical Systems, Inc. | 1,018 | 68 |
*Biosite Inc. | 1,169 | 68 |
*CONMED Corp. | 2,246 | 67 |
*Bio-Rad Laboratories, Inc. Class A | 1,254 | 61 |
Cyberonics, Inc. | 1,631 | 61 |
*PSS World Medical, Inc. | 4,975 | 61 |
Wright Medical Group, Inc. | 2,343 | 60 |
West Pharmaceutical Services, Inc. | 2,323 | 60 |
*Laserscope | 1,646 | 55 |
Arrow International, Inc. | 1,505 | 51 |
*Viasys Healthcare Inc. | 2,378 | 49 |
Advanced Neuromodulation Systems, Inc. | 1,635 | 48 |
*DJ Orthopedics Inc. | 1,743 | 42 |
SurModics, Inc. | 1,165 | 37 |
Thoratec Corp. | 3,030 | 36 |
*Kyphon Inc. | 1,329 | 33 |
ICU Medical, Inc. | 1,016 | 31 |
SonoSite, Inc. | 1,135 | 31 |
*Merit Medical Systems, Inc. | 1,932 | 25 |
Align Technology, Inc. | 3,297 | 25 |
Inverness Medical Innovations, Inc. | 1,041 | 25 |
*Molecular Devices Corp. | 1,038 | 22 |
*OraSure Technologies, Inc. | 3,118 | 21 |
Vital Signs, Inc. | 351 | 14 |
Young Innovations, Inc. | 310 | 11 |
Conceptus, Inc. | 1,260 | 10 |
Closure Medical Corp. | 405 | 9 |
14,852 | ||
Medical Services (0.7%) | ||
*Coventry Health Care Inc. | 7,348 | 464 |
*Covance, Inc. | 4,660 | 204 |
*VCA Antech, Inc. | 5,988 | 120 |
Magellan Health Services, Inc. | 2,117 | 72 |
*PAREXEL International Corp. | 2,045 | 46 |
*RehabCare Group, Inc. | 1,308 | 38 |
944 | ||
Multi-Sector Companies (0.2%) | ||
Hillenbrand Industries, Inc. | 4,196 | 237 |
Retail (0.4%) | ||
Fisher Scientific International Inc. | 8,977 | 544 |
Scientific Equipment & Supplies (0.3%) | ||
Applera Corp.-Applied Biosystems Group | 14,792 | 304 |
*Varian, Inc. | 2,680 | 114 |
Bioveris Corp. | 1,276 | 8 |
426 | ||
Services-Commercial (0.1%) | ||
Chemed Corp. | 940 | 67 |
*The Advisory Board Co. | 1,209 | 48 |
Cross Country Healthcare, Inc. | 1,670 | 26 |
*AMN Healthcare Services, Inc. | 849 | 11 |
Medical Staffing Network Holdings, Inc. | 532 | 3 |
155 | ||
TOTAL COMMON STOCKS | ||
(Cost $125,511) | 127,825 | |
TEMPORARY CASH INVESTMENT (0.0%) | ||
Vanguard Market Liquidity Fund, 2.540%**-Note E | ||
(Cost $11) | 10,800 | $11 |
TOTAL INVESTMENTS (99.9%) | ||
(Cost $125,522) | 127,836 | |
OTHER ASSETS AND LIABILITIES--NET (0.1%) | 176 | |
NET ASSETS (100%) | $128,012 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. | ||
STATEMENT OF ASSETS AND LIABILITIES | ||
Assets | ||
Investments in Securities at Value | $127,836 | |
Receivables for Capital Shares Issued | 10,002 | |
Other Assets--Note B | 582 | |
Total Assets | 138,420 | |
Liabilities | ||
Payables for Investment Securities Purchased | (10,358) | |
Other Liabilities--Note E | (50) | |
Total Liabilities | (10,408) | |
NET ASSETS (100%) | $128,012 | |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $125,467 |
Undistributed Net Investment Income | 221 |
Accumulated Net Realized Gains | 10 |
Unrealized Appreciation | 2,314 |
NET ASSETS | $128,012 |
Admiral Shares-Net Assets | |
Applicable to 2,122,499 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $53,040 |
NET ASSET VALUE PER SHARE-ADMIRAL SHARES | $24.99 |
VIPER Shares--Net Assets | |
Applicable to 1,500,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $74,972 |
NET ASSET VALUE PER SHARE-VIPER SHARES | $49.98 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
34
Industrials Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (100.2%) | ||
Aerospace (10.4%) | ||
United Technologies Corp. | 3,694 | $ 369 |
The Boeing Co. | 5,207 | 286 |
Lockheed Martin Corp. | 2,716 | 161 |
Northrop Grumman Corp. | 2,324 | 123 |
Rockwell Collins, Inc. | 1,346 | 62 |
Goodrich Corp. | 864 | 32 |
*United Defense Industries Inc. | 438 | 24 |
*Alliant Techsystems, Inc. | 310 | 21 |
*Moog Inc. | 180 | 8 |
Teledyne Technologies, Inc. | 238 | 7 |
Curtiss-Wright Corp. | 112 | 6 |
*Orbital Sciences Corp. | 562 | 6 |
United Industrial Corp. | 146 | 5 |
MTC Technologies, Inc. | 110 | 4 |
HEICO Corp. Class A | 198 | 3 |
HEICO Corp. | 92 | 2 |
Argon ST, Inc. | 12 | — |
1,119 | ||
Air Transportation (3.8%) | ||
FedEx Corp. | 2,056 | 201 |
Southwest Airlines Co. | 5,298 | 73 |
Expeditors International of Washington, Inc. | 800 | 44 |
*AMR Corp. | 1,398 | 12 |
*EGL, Inc. | 354 | 11 |
JetBlue Airways Corp. | 618 | 11 |
Skywest, Inc. | 485 | 8 |
Aviall Inc. | 284 | 8 |
Alaska Air Group, Inc. | 233 | 7 |
*Continental Airlines, Inc. Class B | 594 | 6 |
*AirTran Holdings, Inc. | 758 | 6 |
*Delta Air Lines, Inc. | 1,091 | 5 |
*ExpressJet Holdings, Inc. | 442 | 5 |
*Northwest Airlines Corp. Class A | 682 | 5 |
Frontier Airlines, Inc. | 415 | 4 |
America West Holdings Corp. Class B | 646 | 3 |
*Mesa Air Group Inc. | 404 | 3 |
412 | ||
Auto Trucks & Parts (1.3%) | ||
PACCAR, Inc. | 1,200 | 90 |
Oshkosh Truck Corp. | 292 | 22 |
Navistar International Corp. | 518 | 20 |
*Wabash National Corp. | 338 | 9 |
141 | ||
Building-Air Conditioning (0.2%) | ||
York International Corp. | 376 | 15 |
Lennox International Inc. | 436 | 9 |
24 | ||
Building-Heating & Plumbing (0.1%) | ||
Jacuzzi Brands, Inc. | 786 | 8 |
AAON, Inc. | 172 | 3 |
11 | ||
Building-Miscellaneous (0.0%) | ||
Griffon Corp. | 224 | 5 |
Building-Roof & Wallboard (0.2%) | ||
USG Corp. | 295 | 9 |
ElkCorp | 220 | 8 |
17 | ||
Building Materials (1.5%) | ||
Masco Corp. | 3,188 | 108 |
Hughes Supply, Inc. | 542 | 17 |
Simpson Manufacturing Co. | 273 | 9 |
Watsco, Inc. | 230 | 9 |
*NCI Building Systems, Inc. | 216 | 8 |
Trex Co., Inc. | 108 | 5 |
Ameron International Corp. | 116 | 4 |
160 | ||
Chemicals (0.0%) | ||
Energy Conversion Devices, Inc. | 254 | 5 |
Commercial Information Services (0.1%) | ||
LECG Corp. | 228 | 4 |
SOURCECORP, Inc. | 184 | 4 |
8 | ||
Communications Technology (0.5%) | ||
L-3 Communications Holdings, Inc. | 756 | 55 |
Computer Services Software & Systems (0.1%) | ||
Mercury Computer Systems, Inc. | 234 | 7 |
Construction (0.3%) | ||
Washington Group International, Inc. | 252 | 11 |
Granite Construction Co. | 348 | 9 |
EMCOR Group, Inc. | 176 | 8 |
28 | ||
Consumer Products (0.2%) | ||
The Toro Co. | 191 | 17 |
Container & Package-Metal & Glass (0.0%) | ||
* Mobile Mini, Inc. | 138 | 5 |
Copper (0.1%) | ||
Mueller Industries Inc. | 268 | 8 |
Diversified Financial Services (0.1%) | ||
PHH Corp. | 369 | 8 |
Diversified Manufacturing (1.2%) | ||
American Standard Cos., Inc. | 1,364 | 62 |
Clarcor Inc. | 232 | 13 |
*Armor Holdings, Inc. | 286 | 11 |
Brady Corp. Class A | 328 | 11 |
Acuity Brands, Inc. | 351 | 10 |
*Hexcel Corp. | 536 | 9 |
Barnes Group, Inc. | 200 | 5 |
Tredegar Corp. | 294 | 5 |
126 | ||
Diversified Production (1.9%) | ||
Danaher Corp. | 1,818 | 98 |
Dover Corp. | 1,526 | 59 |
Pentair, Inc. | 716 | 30 |
*Thomas & Betts Corp. | 518 | 16 |
203 | ||
Education--Services (1.9%) | ||
Apollo Group, Inc. Class A | 1,108 | 82 |
Career Education Corp. | 766 | 26 |
*ITT Educational Services, Inc. | 368 | 18 |
*Education Management Corp. | 540 | 16 |
*Laureate Education Inc. | 358 | 16 |
*Corinthian Colleges, Inc. | 751 | 13 |
Strayer Education, Inc. | 116 | 12 |
DeVry, Inc. | 522 | 9 |
*Bright Horizons Family Solutions, Inc. | 112 | 8 |
Universal Technical Institute Inc. | 143 | 5 |
Learning Tree International, Inc. | 228 | 3 |
208 | ||
Electrical Equipment & Components (2.9%) | ||
Emerson Electric Co. | 3,012 | 200 |
Cooper Industries, Inc. Class A | 684 | 47 |
Ametek, Inc. | 562 | 22 |
Genlyte Group, Inc. | 104 | 9 |
Baldor Electric Co. | 308 | 8 |
Triumph Group, Inc. | 188 | 7 |
Franklin Electric, Inc. | 158 | 6 |
A.O. Smith Corp. | 178 | 5 |
Power-One, Inc. | 608 | 4 |
35
| Shares | Market Value^ (000) |
---|---|---|
* General Cable Corp. | 81 | $ 1 |
Color Kinetics Inc. | 26 | — |
309 | ||
Electronics (0.0%) | ||
II-VI, Inc. | 152 | 6 |
Electronics-Technology (3.4%) | ||
General Dynamics Corp. | 1,238 | 130 |
Raytheon Co. | 3,250 | 124 |
Rockwell Automation, Inc. | 1,373 | 85 |
*DRS Technologies, Inc. | 236 | 10 |
EDO Corp. | 202 | 6 |
Cubic Corp. | 222 | 4 |
*Herley Industries Inc. | 220 | 4 |
363 | ||
Energy Equipment (0.1%) | ||
Plug Power, Inc. | 692 | 5 |
Global Power Equipment Group Inc. | 368 | 4 |
9 | ||
Energy Miscellaneous (0.0%) | ||
* FuelCell Energy, Inc. | 528 | 6 |
Engineering & Contracting Services (0.9%) | ||
Fluor Corp. | 650 | 41 |
*Jacobs Engineering Group Inc. | 411 | 23 |
*Dycom Industries, Inc. | 430 | 12 |
*URS Corp. | 360 | 10 |
Quanta Services, Inc. | 1,080 | 8 |
Infrasource Services Inc. | 56 | 1 |
95 | ||
Financial Data Processing Services (0.2%) | ||
Deluxe Corp. | 414 | 16 |
John H. Harland Co. | 238 | 9 |
PRG-Schultz International, Inc. | 526 | 2 |
27 | ||
Financial Information Services (0.6%) | ||
Equifax, Inc. | 1,088 | 33 |
*The Dun & Bradstreet Corp. | 528 | 32 |
65 | ||
Financial Miscellaneous (0.7%) | ||
H & R Block, Inc. | 1,151 | 61 |
Sotheby's Holdings Class A | 378 | 7 |
Portfolio Recovery Associates, Inc. | 132 | 5 |
Asset Acceptance Capital Corp. | 146 | 3 |
76 | ||
Forest Products (0.0%) | ||
Universal Forest Products, Inc. | 152 | 6 |
Forms & Bulk Print Services (0.1%) | ||
Ennis, Inc. | 220 | 4 |
The Standard Register Co. | 189 | 3 |
7 | ||
Glass (0.0%) | ||
Apogee Enterprises, Inc. | 378 | 5 |
Health & Personal Care (0.1%) | ||
*Stericycle, Inc. | 336 | 15 |
Household Furnishings (0.0%) | ||
American Woodmark Corp. | 119 | 4 |
Identification Control & Filter Devices (2.5%) | ||
Parker Hannifin Corp. | 881 | 58 |
American Power Conversion Corp. | 1,372 | 30 |
Pall Corp. | 1,006 | 27 |
Hubbell Inc. Class B | 420 | 23 |
Donaldson Co., Inc. | 646 | 21 |
Roper Industries Inc. | 304 | 20 |
IDEX Corp. | 396 | 16 |
Crane Co. | 430 | 13 |
Flowserve Corp. | 482 | 12 |
*ESCO Technologies Inc. | 130 | 11 |
Mine Safety Appliances Co. | 224 | 10 |
CUNO Inc. | 166 | 9 |
Watts Water Technologies, Inc. | 213 | 7 |
Robbins & Myers, Inc. | 206 | 5 |
C & D Technologies, Inc. | 302 | 4 |
Gorman-Rupp Co. | 188 | 4 |
Vicor Corp. | 344 | 4 |
274 | ||
Insurance-Multiline (0.1%) | ||
*Alleghany Corp. | 46 | 13 |
Machine Tools (0.1%) | ||
Lincoln Electric Holdings, Inc. | 312 | 10 |
Machinery & Engineering (0.0%) | ||
Applied Industrial Technology, Inc. | 226 | 6 |
Machinery--Agricultural (1.4%) | ||
Deere & Co. | 1,812 | 129 |
*AGCO Corp. | 748 | 15 |
Lindsay Manufacturing Co. | 168 | 4 |
148 | ||
Machinery-Construction & Handling (2.6%) | ||
Caterpillar, Inc. | 2,494 | 237 |
Terex Corp. | 402 | 18 |
The Manitowoc Co., Inc. | 252 | 10 |
Stewart & Stevenson Services, Inc. | 344 | 7 |
NACCO Industries, Inc. Class A | 49 | 5 |
*Astec Industries, Inc. | 218 | 4 |
281 | ||
Machinery-Engines (0.3%) | ||
Cummins Inc. | 274 | 20 |
Briggs & Stratton Corp. | 328 | 13 |
33 | ||
Machinery-Industrial/Special (3.5%) | ||
Illinois Tool Works, Inc. | 1,844 | 166 |
Ingersoll-Rand Co. | 1,261 | 106 |
Joy Global Inc. | 594 | 22 |
Kennametal, Inc. | 318 | 16 |
*Actuant Corp. | 234 | 13 |
Nordson Corp. | 290 | 12 |
Woodward Governor Co. | 110 | 8 |
Gardner Denver Inc. | 183 | 8 |
Thomas Industries, Inc. | 148 | 6 |
Tecumseh Products Co. Class A | 140 | 6 |
Kadant Inc. | 226 | 5 |
Tennant Co. | 112 | 4 |
Curtiss-Wright Corp. Class B | 62 | 3 |
Tecumseh Products Co. Class B | 28 | 1 |
376 | ||
Machinery-Specialty (0.4%) | ||
Graco, Inc. | 552 | 21 |
Engineered Support Systems, Inc. | 240 | 13 |
JLG Industries, Inc. | 384 | 8 |
42 | ||
Manufacturing (0.1%) | ||
Federal Signal Corp. | 466 | 7 |
Standex International Corp. | 168 | 5 |
12 | ||
Metal Fabricating (0.9%) | ||
Precision Castparts Corp. | 506 | 38 |
The Timken Co. | 576 | 16 |
Shaw Group, Inc. | 567 | 12 |
Kaydon Corp. | 284 | 9 |
36
| Shares | Market Value^ (000) |
---|---|---|
Valmont Industries, Inc. | 236 | $ 6 |
CIRCOR International, Inc. | 228 | 6 |
Penn Engineering & Manufacturing Corp. | 210 | 4 |
*Encore Wire Corp. | 272 | 3 |
94 | ||
Metals & Minerals & Commodities (0.1%) | ||
*Ceradyne, Inc. | 249 | 8 |
Metals & Minerals Miscellaneous (0.1%) | ||
*GrafTech International Ltd. | 900 | 8 |
Miscellaneous Equipment (0.3%) | ||
W.W. Grainger, Inc. | 600 | 38 |
Miscellaneous Materials & Processing (0.0%) | ||
Insituform Technologies Inc. Class A | 248 | 4 |
Multi-Sector Companies (33.3%) | ||
General Electric Co. | 60,298 | 2,122 |
Tyco International Ltd. | 14,440 | 483 |
3M Co. | 5,371 | 451 |
Honeywell International Inc. | 5,944 | 226 |
Eaton Corp. | 1,064 | 74 |
Textron, Inc. | 926 | 72 |
ITT Industries, Inc. | 634 | 56 |
SPX Corp. | 618 | 28 |
Carlisle Co., Inc. | 256 | 18 |
Teleflex Inc. | 283 | 14 |
Walter Industries, Inc. | 318 | 12 |
*McDermott International, Inc. | 548 | 11 |
Trinity Industries, Inc. | 354 | 10 |
GenCorp, Inc. | 478 | 9 |
Sequa Corp. Class A | 72 | 4 |
Kaman Corp. Class A | 348 | 4 |
3,594 | ||
Office Furniture & Business Equipment (1.2%) | ||
Pitney Bowes, Inc. | 1,716 | 79 |
HNI Corp. | 440 | 19 |
Herman Miller, Inc. | 612 | 18 |
Steelcase Inc. | 466 | 7 |
*Imagistics International Inc. | 190 | 6 |
129 | ||
Office Supplies (0.4%) | ||
Avery Dennison Corp. | 710 | 43 |
Paper (0.1%) | ||
Albany International Corp. | 264 | 9 |
Power Transmission Equipment (0.1%) | ||
Regal-Beloit Corp. | 282 | 9 |
Printing & Copying Services (0.0%) | ||
Bowne & Co., Inc. | 394 | 6 |
Production Technical Equipment (0.1%) | ||
*Esterline Technologies Corp. | 241 | 8 |
Publishing-Miscellaneous (0.7%) | ||
R.R. Donnelley & Sons Co. | 1,552 | 52 |
Banta Corp. | 244 | 11 |
Consolidated Graphics, Inc. | 150 | 8 |
71 | ||
Railroad Equipment (0.1%) | ||
Wabtec Corp. | 432 | 8 |
Railroads (4.2%) | ||
Burlington Northern Santa Fe Corp. | 2,732 | 137 |
Union Pacific Corp. | 1,814 | 115 |
Norfolk Southern Corp. | 2,900 | 104 |
CSX Corp. | 1,620 | 67 |
Kansas City Southern | 618 | 12 |
Florida East Coast Industries, Inc. Class A | 232 | 10 |
*Genesee & Wyoming Inc. Class A | 278 | 7 |
RailAmerica, Inc. | 402 | 5 |
457 | ||
Rent & Lease Services-Commercial (0.4%) | ||
Ryder System, Inc. | 494 | 21 |
*United Rentals, Inc. | 620 | 12 |
McGrath RentCorp | 99 | 4 |
Electro Rent Corp. | 268 | 4 |
41 | ||
Rent & Lease Services-Consumer (0.2%) | ||
Dollar Thrifty Automotive Group, Inc. | 280 | 9 |
*Wesco International, Inc. | 224 | 8 |
*Amerco, Inc. | 126 | 6 |
23 | ||
Retail (0.5%) | ||
Fastenal Co. | 504 | 29 |
MSC Industrial Direct Co., Inc. Class A | 408 | 13 |
School Specialty, Inc. | 174 | 7 |
Lawson Products, Inc. | 88 | 4 |
53 | ||
Securities Brokers & Services (0.0%) | ||
NCO Group, Inc. | 282 | 6 |
Services-Commercial (7.7%) | ||
Cendant Corp. | 7,381 | 163 |
Waste Management, Inc. | 4,210 | 123 |
Cintas Corp. | 974 | 43 |
Republic Services, Inc. Class A | 1,154 | 37 |
Robert Half International, Inc. | 1,254 | 37 |
Manpower Inc. | 700 | 31 |
ServiceMaster Co. | 2,280 | 30 |
*ChoicePoint Inc. | 690 | 28 |
Aramark Corp. Class B | 858 | 24 |
*Monster Worldwide Inc. | 813 | 23 |
The Corporate Executive Board Co. | 296 | 19 |
The Brink's Co. | 449 | 16 |
*Copart, Inc. | 581 | 14 |
IKON Office Solutions, Inc. | 1,266 | 13 |
Allied Waste Industries, Inc. | 1,614 | 13 |
*Waste Connections, Inc. | 356 | 12 |
Corrections Corp. of America REIT | 308 | 12 |
*Navigant Consulting, Inc. | 432 | 11 |
*Resources Global Professionals | 220 | 11 |
Tetra Tech, Inc. | 576 | 10 |
*West Corp. | 258 | 9 |
Watson Wyatt & Co. Holdings | 314 | 9 |
G & K Services, Inc. Class A | 200 | 9 |
FTI Consulting, Inc. | 432 | 8 |
ABM Industries Inc. | 420 | 8 |
*Korn/Ferry International | 396 | 8 |
*Heidrick & Struggles International, Inc. | 222 | 8 |
Viad Corp. | 258 | 7 |
Kelly Services, Inc. Class A | 228 | 7 |
*Labor Ready, Inc. | 351 | 7 |
*Teletech Holdings Inc. | 546 | 6 |
Rollins, Inc. | 244 | 6 |
Gevity HR, Inc. | 334 | 6 |
*Coinstar, Inc. | 256 | 6 |
*CoStar Group, Inc. | 162 | 6 |
Geo Group Inc. | 188 | 5 |
Spherion Corp. | 682 | 5 |
Pre-Paid Legal Services, Inc. | 139 | 5 |
Volt Information Sciences Inc. | 158 | 5 |
Hudson Highland Group, Inc. | 264 | 4 |
*Vertrue Inc. | 113 | 4 |
CDI Corp. | 200 | 4 |
37
| Shares | Market Value^ (000) |
---|---|---|
Century Business Services, Inc. | 950 | 4 |
Jackson Hewitt Tax Service Inc. | 185 | 4 |
Central Parking Corp. | 264 | 4 |
Sirva Inc. | 408 | 4 |
828 | ||
Shipping (0.2%) | ||
Alexander & Baldwin, Inc. | 307 | 14 |
Kirby Corp. | 206 | 9 |
23 | ||
Steel (0.2%) | ||
Harsco Corp. | 320 | 19 |
Telecommunications Equipment (0.0%) | ||
Mastec Inc. | 415 | 4 |
Transportation Miscellaneous (3.6%) | ||
United Parcel Service, Inc. | 4,242 | 329 |
C.H. Robinson Worldwide, Inc. | 574 | 31 |
Laidlaw International Inc. | 490 | 11 |
Pacer International, Inc. | 360 | 9 |
UTI Worldwide, Inc. | 123 | 9 |
Sea Containers Ltd. Class A | 308 | 6 |
395 | ||
Truckers (1.6%) | ||
J.B. Hunt Transport Services, Inc. | 466 | 22 |
*Yellow Roadway Corp. | 366 | 21 |
CNF Inc. | 422 | 19 |
*Landstar System, Inc. | 466 | 16 |
USF Corp. | 262 | 13 |
*Swift Transportation Co., Inc. | 442 | 10 |
Heartland Express, Inc. | 492 | 10 |
Knight Transportation, Inc. | 376 | 10 |
*Forward Air Corp. | 214 | 9 |
Overnite Corp. | 276 | 9 |
Werner Enterprises, Inc. | 422 | 9 |
Arkansas Best Corp. | 188 | 8 |
*Old Dominion Freight Line, Inc. | 222 | 8 |
Covenant Transport, Inc. | 174 | 4 |
P.A.M. Transportation Services, Inc. | 178 | 3 |
171 | ||
Wholesalers (0.3%) | ||
Adesa, Inc. | 722 | 16 |
*United Stationers, Inc. | 306 | 13 |
29 | ||
TOTAL INVESTMENTS | ||
(Cost $9,829) | 10,833 | |
OTHER ASSETS AND LIABILITIES (-0.2%) | ||
Other Assets--Note B | 43 | |
Liabilities | (70) | |
(27) | ||
NET ASSETS (100%) | $10,806 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
REIT-Real Estate Investment Trust. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $9,722 |
Undistributed Net Investment Income | 29 |
Accumulated Net Realized Gains | 51 |
Unrealized Appreciation | 1,004 |
NET ASSETS | $10,806 |
VIPER Shares--Net Assets | |
Applicable to 200,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $10,806 |
NET ASSET VALUE PER SHARE--VIPER SHARES | $54.03 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
38
Information Technology Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (99.9%) | ||
Advertising Agencies (0.1%) | ||
*ValueClick, Inc. | 958 | $ 12 |
*aQuantive, Inc. | 611 | 6 |
Marchex, Inc. | 197 | 4 |
22 | ||
Chemicals (0.0%) | ||
*Cabot Microelectronics Corp. | 275 | 9 |
Commercial Information Services (0.1%) | ||
*Ask Jeeves, Inc. | 534 | 12 |
CMGI Inc. | 4,196 | 8 |
*infoUSA Inc. | 496 | 5 |
25 | ||
Communications Technology (15.8%) | ||
*Cisco Systems, Inc. | 76,623 | 1,335 |
QUALCOMM Inc. | 18,872 | 681 |
Motorola, Inc. | 27,516 | 431 |
Corning, Inc. | 16,232 | 186 |
*Lucent Technologies, Inc. | 50,237 | 154 |
Juniper Networks, Inc. | 5,314 | 114 |
*NCR Corp. | 2,174 | 85 |
Avaya Inc. | 4,978 | 70 |
Scientific-Atlanta, Inc. | 1,777 | 55 |
*Comverse Technology, Inc. | 2,254 | 52 |
Harris Corp. | 772 | 52 |
Symbol Technologies, Inc. | 2,805 | 50 |
*McAfee Inc. | 1,834 | 42 |
*Tellabs, Inc. | 5,216 | 37 |
JDS Uniphase Corp. | 16,007 | 30 |
*TIBCO Software Inc. | 2,177 | 21 |
ADC Telecommunications, Inc. | 9,075 | 21 |
*Avocent Corp. | 593 | 20 |
*Brocade Communications Systems, Inc. | 3,105 | 19 |
3Com Corp. | 4,775 | 17 |
*Foundry Networks, Inc. | 1,405 | 15 |
UTStarcom, Inc. | 1,104 | 14 |
ADTRAN Inc. | 757 | 14 |
Anixter International Inc. | 323 | 12 |
*Tekelec | 644 | 11 |
*CIENA Corp. | 5,498 | 11 |
CSG Systems International, Inc. | 581 | 10 |
*CommScope, Inc. | 611 | 9 |
Harmonic, Inc. | 840 | 9 |
*Sycamore Networks, Inc. | 2,553 | 9 |
*WebEx Communications, Inc. | 392 | 9 |
*j2 Global Communications, Inc. | 233 | 9 |
Black Box Corp. | 202 | 8 |
*Extreme Networks, Inc. | 1,221 | 7 |
*Aspect Communications Corp. | 631 | 7 |
*Ixia | 378 | 7 |
Inter-Tel, Inc. | 211 | 6 |
*ViaSat, Inc. | 266 | 5 |
*Ditech Communications Corp. | 349 | 4 |
Talx Corp. | 211 | 4 |
Remec, Inc. | 618 | 4 |
*SeaChange International, Inc. | 279 | 4 |
*InterVoice, Inc. | 356 | 4 |
*Atheros Communications | 268 | 4 |
Secure Computing Corp. | 363 | 3 |
*Westell Technologies, Inc. | 526 | 3 |
Enterasys Networks, Inc. | 2,146 | 3 |
*Standard Microsystem Corp. | 177 | 3 |
*Anaren, Inc. | 223 | 3 |
*Novatel Wireless, Inc. | 259 | 3 |
Entrust, Inc. | 667 | 3 |
Bel Fuse, Inc. Class B | 84 | 3 |
Finisar Corp. | 1,660 | 2 |
NETGEAR, Inc. | 174 | 2 |
Echelon Corp. | 296 | 2 |
*Ulticom, Inc. | 135 | 2 |
Oplink Communications, Inc. | 979 | 2 |
Avanex Corp. | 811 | 1 |
*Net2Phone, Inc. | 466 | 1 |
Bel Fuse, Inc. Class A | 29 | 1 |
3,705 | ||
Computer Services Software & Systems (24.4%) | ||
Microsoft Corp. | 114,051 | 2,872 |
Oracle Corp. | 44,797 | 578 |
Adobe Systems, Inc. | 2,795 | 173 |
Symantec Corp. | 7,354 | 162 |
Computer Associates International, Inc. | 5,469 | 148 |
Accenture Ltd. | 5,665 | 145 |
Veritas Software Corp. | 5,071 | 123 |
*Computer Sciences Corp. | 2,216 | 102 |
*Intuit, Inc. | 2,120 | 91 |
Autodesk, Inc. | 2,703 | 80 |
*Cognizant Technology Solutions Corp. | 1,537 | 73 |
*Affiliated Computer Services, Inc. Class A | 1,401 | 72 |
*Mercury Interactive Corp. | 1,068 | 49 |
Siebel Systems, Inc. | 5,525 | 47 |
*QLogic Corp. | 1,095 | 44 |
*Citrix Systems, Inc. | 1,958 | 44 |
*Cadence Design Systems, Inc. | 3,100 | 43 |
BMC Software, Inc. | 2,628 | 39 |
BEA Systems, Inc. | 4,385 | 36 |
Ceridian Corp. | 1,776 | 32 |
*Compuware Corp. | 4,622 | 31 |
*Macromedia, Inc. | 833 | 28 |
*NAVTEQ Corp. | 606 | 27 |
Novell, Inc. | 4,562 | 24 |
*Hyperion Solutions Corp. | 444 | 22 |
*Red Hat, Inc. | 1,901 | 22 |
Acxiom Corp. | 965 | 22 |
Sybase, Inc. | 1,098 | 21 |
Reynolds & Reynolds Class A | 742 | 21 |
*F5 Networks, Inc. | 367 | 20 |
National Instruments Corp. | 677 | 19 |
*CACI International, Inc. | 358 | 19 |
*Parametric Technology Corp. | 3,006 | 17 |
*Websense, Inc. | 286 | 17 |
*MICROS Systems, Inc. | 452 | 15 |
*Anteon International Corp. | 372 | 14 |
*Akamai Technologies, Inc. | 1,269 | 14 |
*ANSYS, Inc. | 380 | 14 |
BearingPoint, Inc. | 1,734 | 14 |
*Macrovision Corp. | 551 | 13 |
Mentor Graphics Corp. | 911 | 13 |
*Wind River Systems Inc. | 864 | 12 |
*SRA International, Inc. | 187 | 11 |
*Ascential Software Corp. | 659 | 10 |
*Internet Security Systems, Inc. | 506 | 10 |
*Electronics for Imaging, Inc. | 599 | 10 |
*MicroStrategy Inc. | 137 | 10 |
*Digital River, Inc. | 320 | 10 |
*Openwave Systems Inc. | 752 | 10 |
*Transaction Systems Architects, Inc. | 401 | 9 |
*Digitas Inc. | 933 | 9 |
*Progress Software Corp. | 391 | 9 |
*Epicor Software Corp. | 565 | 9 |
Informatica Corp. | 1,094 | 9 |
*SERENA Software, Inc. | 355 | 8 |
Borland Software Corp. | 950 | 8 |
*SafeNet, Inc. | 263 | 8 |
Equinix, Inc. | 176 | 8 |
RealNetworks, Inc. | 1,206 | 8 |
*Keane, Inc. | 537 | 7 |
NetIQ Corp. | 590 | 7 |
39
| Shares | Market Value^ (000) |
---|---|---|
Verint Systems Inc. | 173 | $ 7 |
*Sapient Corp. | 880 | 7 |
*Quest Software, Inc. | 462 | 6 |
Manhattan Associates, Inc. | 314 | 6 |
Magma Design Automation, Inc. | 453 | 6 |
Altiris, Inc. | 201 | 6 |
*Ariba, Inc. | 636 | 6 |
Packeteer, Inc. | 337 | 5 |
Zoran Corp. | 472 | 5 |
Ciber, Inc. | 648 | 5 |
Retek Inc. | 572 | 5 |
SS&C Technologies, Inc. | 195 | 5 |
*Verity, Inc. | 394 | 5 |
Micromuse Inc. | 920 | 5 |
ScanSoft, Inc. | 1,014 | 4 |
*ManTech International Corp. | 174 | 4 |
Open Solutions Inc. | 201 | 4 |
JDA Software Group, Inc. | 297 | 4 |
*MSC Software Corp. | 313 | 4 |
SupportSoft, Inc. | 633 | 4 |
Interwoven Inc. | 409 | 4 |
*Agile Software Corp. | 538 | 4 |
SonicWALL, Inc. | 590 | 4 |
*SPSS, Inc. | 179 | 3 |
Vignette Corp. | 2,882 | 3 |
webMethods, Inc. | 543 | 3 |
MRO Software Inc. | 251 | 3 |
Opsware, Inc. | 598 | 3 |
SYNNEX Corp. | 144 | 3 |
Pinnacle Systems, Inc. | 693 | 3 |
Lawson Software Inc. | 503 | 3 |
ActivCard Corp. | 432 | 3 |
Lionbridge Technologies, Inc. | 461 | 3 |
*Concur Technologies, Inc. | 326 | 3 |
MatrixOne, Inc. | 513 | 3 |
*E.piphany Inc. | 772 | 3 |
*Jupitermedia Corp. | 183 | 2 |
Keynote Systems Inc. | 195 | 2 |
EPIQ Systems, Inc. | 182 | 2 |
*Tyler Technologies, Inc. | 304 | 2 |
Integral Systems, Inc. | 101 | 2 |
OpenTV Corp. | 861 | 2 |
PDF Solutions, Inc. | 142 | 2 |
*PalmSource, Inc. | 189 | 2 |
SeeBeyond Technology Corp. | 492 | 2 |
Blue Coat Systems, Inc. | 97 | 2 |
Motive, Inc. | 141 | 2 |
Digimarc Corp. | 200 | 2 |
PEC Solutions, Inc. | 127 | 1 |
Manugistics Group, Inc. | 729 | 1 |
Syntel, Inc. | 71 | 1 |
*Blackboard Inc. | 73 | 1 |
Embarcadero Technologies, Inc. | 153 | 1 |
*Gartner, Inc. Class A | 84 | 1 |
QAD Inc. | 98 | 1 |
iGATE Corp. | 180 | 1 |
*Pegasystems Inc. | 112 | 1 |
5,728 | ||
Computer Technology (22.4%) | ||
International Business Machines Corp. | 19,371 | 1,793 |
Dell Inc. | 26,170 | 1,049 |
Hewlett-Packard Co. | 33,413 | 695 |
Apple Computer, Inc. | 9,038 | 405 |
EMC Corp. | 28,007 | 355 |
Sun Microsystems, Inc. | 38,991 | 165 |
Electronic Data Systems Corp. | 5,963 | 127 |
*Network Appliance, Inc. | 3,977 | 119 |
*NVIDIA Corp. | 1,885 | 55 |
Seagate Technology | 3,016 | 54 |
*SanDisk Corp. | 1,911 | 51 |
*Storage Technology Corp. | 1,321 | 42 |
*Zebra Technologies Corp. Class A | 735 | 37 |
Synopsys, Inc. | 1,819 | 33 |
*Unisys Corp. | 3,880 | 30 |
*Western Digital Corp. | 2,475 | 28 |
*Ingram Micro, Inc. Class A | 1,368 | 25 |
Emulex Corp. | 920 | 16 |
*Maxtor Corp. | 2,735 | 15 |
Imation Corp. | 397 | 14 |
*UNOVA, Inc. | 532 | 12 |
*PalmOne, Inc. | 519 | 12 |
*RSA Security Inc. | 729 | 12 |
Gateway, Inc. | 2,486 | 12 |
*Perot Systems Corp. | 867 | 12 |
FileNET Corp. | 487 | 11 |
Intergraph Corp. | 369 | 11 |
*Hutchinson Technology, Inc. | 289 | 9 |
Adaptec, Inc. | 1,243 | 7 |
*Synaptics Inc. | 257 | 6 |
Advanced Digital Information Corp. | 653 | 5 |
Quantum Corp. | 1,874 | 5 |
*Komag, Inc. | 214 | 4 |
McDATA Corp. Class A | 951 | 4 |
Lexar Media, Inc. | 794 | 3 |
*Cray Inc. | 844 | 3 |
Silicon Graphics, Inc. | 2,665 | 3 |
Dot Hill Systems Corp. | 431 | 3 |
InFocus Corp. | 415 | 3 |
Iomega Corp. | 536 | 2 |
Safeguard Scientifics, Inc. | 1,256 | 2 |
FalconStor Software, Inc. | 236 | 2 |
McDATA Corp. | 345 | 1 |
5,252 | ||
Consumer Electronics (4.3%) | ||
Yahoo! Inc. | 14,262 | 460 |
Electronic Arts Inc. | 3,537 | 228 |
Google Inc. | 489 | 92 |
*VeriSign, Inc. | 2,948 | 81 |
*Activision, Inc. | 1,645 | 36 |
*Take-Two Interactive Software, Inc. | 545 | 20 |
*Earthlink, Inc. | 1,764 | 15 |
*CNET Networks, Inc. | 1,547 | 14 |
*InfoSpace, Inc. | 281 | 12 |
*THQ Inc. | 426 | 12 |
*DoubleClick Inc. | 1,406 | 11 |
Midway Games Inc. | 657 | 7 |
*United Online, Inc. | 539 | 6 |
Digital Theater Systems Inc. | 137 | 3 |
FindWhat.com | 171 | 2 |
Atari, Inc. | 384 | 1 |
1,000 | ||
Diversified Financial Services (0.1%) | ||
*BISYS Group, Inc. | 1,362 | 20 |
*Euronet Worldwide, Inc. | 268 | 7 |
27 | ||
Education-Services (0.0%) | ||
Renaissance Learning, Inc. | 104 | 2 |
Electrical & Electronics (0.2%) | ||
*Benchmark Electronics, Inc. | 486 | 16 |
Power Integrations, Inc. | 332 | 7 |
Plexus Corp. | 474 | 5 |
*TTM Technologies, Inc. | 417 | 4 |
OSI Systems Inc. | 154 | 3 |
*Universal Display Corp. | 236 | 2 |
37 | ||
40
| Shares | Market Value^ (000) |
---|---|---|
Electrical Equipment & Components (0.4%) | ||
Molex, Inc. Class A | 947 | $ 22 |
Molex, Inc. | 737 | 19 |
*Littelfuse, Inc. | 280 | 9 |
*Technitrol, Inc. | 417 | 7 |
*Taser International Inc. | 555 | 7 |
*MKS Instruments, Inc. | 384 | 7 |
CTS Corp. | 402 | 5 |
Cohu, Inc. | 221 | 4 |
Sonic Solutions, Inc. | 251 | 4 |
84 | ||
Electronics (1.3%) | ||
*Flextronics International Ltd. | 6,497 | 87 |
*Amphenol Corp. | 1,036 | 41 |
*Sanmina-SCI Corp. | 6,013 | 33 |
*FLIR Systems, Inc. | 802 | 25 |
*Avid Technology, Inc. | 366 | 25 |
*Vishay Intertechnology, Inc. | 1,795 | 23 |
*Semtech Corp. | 809 | 16 |
*Aeroflex, Inc. | 912 | 9 |
AVX Corp. | 675 | 8 |
Agilysys, Inc. | 328 | 6 |
Methode Electronics, Inc. Class A | 371 | 4 |
Park Electrochemical Corp. | 206 | 4 |
BEI Technologies, Inc. | 146 | 4 |
*Multi-Fineline Electronix, Inc. | 171 | 4 |
*Daktronics, Inc. | 156 | 3 |
Kopin Corp. | 731 | 3 |
295 | ||
Electronics-Gauge & Meter (0.3%) | ||
Tektronix, Inc. | 1,055 | 31 |
*Mettler-Toledo International Inc. | 502 | 26 |
Itron, Inc. | 218 | 6 |
Keithley Instruments Inc. | 143 | 2 |
*Metrologic Instruments, Inc. | 92 | 2 |
67 | ||
Electronics-Semiconductors/Components (17.9%) | ||
Intel Corp. | 73,578 | 1,764 |
Texas Instruments, Inc. | 20,162 | 534 |
Maxim Integrated Products, Inc. | 3,787 | 163 |
Analog Devices, Inc. | 4,412 | 162 |
Linear Technology Corp. | 3,594 | 140 |
Xilinx, Inc. | 4,079 | 123 |
Broadcom Corp. | 3,079 | 99 |
Altera Corp. | 4,339 | 90 |
National Semiconductor Corp. | 4,128 | 82 |
*Marvell Technology Group Ltd. | 2,177 | 80 |
*Micron Technology, Inc. | 6,394 | 74 |
Advanced Micro Devices, Inc. | 4,166 | 73 |
Microchip Technology, Inc. | 2,406 | 66 |
*Freescale Semiconductor, Inc. Class B | 3,110 | 60 |
*Jabil Circuit, Inc. | 1,858 | 48 |
*Arrow Electronics, Inc. | 1,382 | 37 |
*International Rectifier Corp. | 777 | 34 |
Intersil Corp. | 1,812 | 31 |
LSI Logic Corp. | 4,611 | 29 |
*Freescale Semiconductor Inc. Class A | 1,508 | 29 |
*Avnet, Inc. | 1,463 | 28 |
Fairchild Semiconductor International, Inc. | 1,346 | 22 |
*Cypress Semiconductor Corp. | 1,553 | 22 |
PMC Sierra Inc. | 2,160 | 22 |
*Cree, Inc. | 908 | 21 |
*MEMC Electronic Materials, Inc. | 1,496 | 19 |
*Rambus Inc. | 1,104 | 19 |
*Integrated Circuit Systems, Inc. | 906 | 18 |
*Agere Systems Inc. Class A | 10,191 | 17 |
Agere Systems Inc. Class B | 10,150 | 16 |
Silicon Laboratories Inc. | 439 | 15 |
Atmel Corp. | 4,778 | 15 |
*Integrated Device Technology Inc. | 1,198 | 15 |
*Skyworks Solutions, Inc. | 1,944 | 14 |
*OmniVision Technologies, Inc. | 684 | 14 |
*SigmaTel Inc. | 317 | 13 |
*Tessera Technologies, Inc. | 311 | 13 |
*RF Micro Devices, Inc. | 2,272 | 13 |
Applied Micro Circuits Corp. | 3,424 | 12 |
*Microsemi Corp. | 721 | 12 |
*Silicon Image, Inc. | 738 | 9 |
Conexant Systems, Inc. | 4,579 | 8 |
*DSP Group Inc. | 316 | 8 |
*FormFactor Inc. | 336 | 8 |
Vitesse Semiconductor Corp. | 2,445 | 7 |
*Micrel, Inc. | 768 | 7 |
*ON Semiconductor Corp. | 1,572 | 7 |
Lattice Semiconductor Corp. | 1,287 | 7 |
Exar Corp. | 453 | 6 |
Amkor Technology, Inc. | 1,162 | 5 |
Genesis Microchip Inc. | 337 | 5 |
TriQuint Semiconductor, Inc. | 1,404 | 5 |
*Cirrus Logic, Inc. | 983 | 5 |
Silicon Storage Technology, Inc. | 979 | 5 |
Actel Corp. | 264 | 5 |
*Pixelworks, Inc. | 402 | 4 |
Virage Logic Corp. | 237 | 3 |
*Excel Technology, Inc. | 127 | 3 |
Mindspeed Technologies, Inc. | 978 | 3 |
AMIS Holdings Inc. | 245 | 3 |
Integrated Silicon Solution, Inc. | 391 | 2 |
Pericom Semiconductor Corp. | 268 | 2 |
IXYS Corp. | 216 | 2 |
Transmeta Corp. | 1,961 | 2 |
*ESS Technology, Inc. | 347 | 2 |
SiRF Technology Holdings, Inc. | 156 | 2 |
*Siliconix, Inc. | 61 | 2 |
4,185 | ||
Electronics-Technology (0.6%) | ||
*Solectron Corp. | 11,212 | 56 |
*Trimble Navigation Ltd. | 615 | 22 |
*The Titan Corp. | 1,003 | 17 |
*Coherent, Inc. | 333 | 10 |
*ScanSource, Inc. | 137 | 9 |
Checkpoint Systems, Inc. | 490 | 8 |
KEMET Corp. | 898 | 7 |
Identix, Inc. | 911 | 5 |
134 | ||
Financial Data Processing Services (5.3%) | ||
First Data Corp. | 9,656 | 396 |
Automatic Data Processing, Inc. | 6,785 | 291 |
Paychex, Inc. | 3,985 | 127 |
SunGard Data Systems, Inc. | 3,400 | 89 |
Fiserv, Inc. | 2,287 | 87 |
DST Systems, Inc. | 784 | 37 |
*CheckFree Corp. | 883 | 34 |
Fair, Isaac, Inc. | 801 | 27 |
Certegy, Inc. | 732 | 26 |
*Kronos, Inc. | 380 | 21 |
Global Payments Inc. | 362 | 20 |
*Alliance Data Systems Corp. | 490 | 19 |
Jack Henry & Associates Inc. | 897 | 18 |
Total System Services, Inc. | 504 | 12 |
*eFunds Corp. | 526 | 12 |
*Digital Insight Corp. | 346 | 6 |
*iPayment Holdings, Inc. | 128 | 6 |
Advent Software, Inc. | 293 | 5 |
CCC Information Services Group | 74 | 2 |
1,235 | ||
41
| Shares | Market Value^ (000) |
---|---|---|
Financial Information Services (0.1%) | ||
FactSet Research Systems Inc. | 338 | $ 11 |
*S1 Corp. | 732 | 6 |
HomeStore, Inc. | 1,031 | 2 |
19 | ||
Identification Control & Filter Devices (0.6%) | ||
Agilent Technologies, Inc. | 5,136 | 123 |
*Paxar Corp. | 403 | 9 |
Veeco Instruments, Inc. | 303 | 5 |
Asyst Technologies, Inc. | 585 | 3 |
Advanced Energy Industries, Inc. | 215 | 2 |
142 | ||
Machinery--Specialty (0.0%) | ||
Helix Technology Corp. | 274 | 5 |
Applied Films Corp. | 153 | 3 |
Semitool, Inc. | 174 | 2 |
10 | ||
Medical & Dental Instruments & Supplies (0.0%) | ||
Landauer, Inc. | 92 | 4 |
Miscellaneous Materials & Processing (0.0%) | ||
*Rogers Corp. | 222 | 10 |
Office Furniture & Business Equipment (1.5%) | ||
*Xerox Corp. | 11,085 | 173 |
Lexmark International, Inc. | 1,499 | 120 |
Diebold, Inc. | 842 | 45 |
Presstek, Inc. | 357 | 3 |
341 | ||
Production Technical Equipment (3.2%) | ||
*Applied Materials, Inc. | 19,779 | 346 |
KLA-Tencor Corp. | 2,304 | 114 |
Novellus Systems, Inc. | 1,681 | 50 |
*LAM Research Corp. | 1,565 | 49 |
*Teradyne, Inc. | 2,279 | 35 |
*Varian Semiconductor Equipment Associates, Inc. | 446 | 18 |
Cognex Corp. | 522 | 14 |
*Dionex Corp. | 238 | 14 |
*Cymer, Inc. | 466 | 13 |
*Axcelis Technologies, Inc. | 1,141 | 10 |
ATMI, Inc. | 345 | 9 |
*Brooks Automation, Inc. | 483 | 9 |
Electro Scientific Industries, Inc. | 311 | 7 |
Credence Systems Corp. | 779 | 7 |
FEI Co. | 276 | 7 |
MTS Systems Corp. | 219 | 7 |
*Entegris Inc. | 667 | 6 |
*Photronics Inc. | 337 | 6 |
Mykrolis Corp. | 424 | 6 |
DuPont Photomasks, Inc. | 185 | 5 |
*Mattson Technology, Inc. | 460 | 5 |
Kulicke & Soffa Industries, Inc. | 629 | 4 |
Photon Dynamics, Inc. | 173 | 4 |
*Ultratech, Inc. | 238 | 4 |
LTX Corp. | 647 | 4 |
*Rudolph Technologies, Inc. | 138 | 3 |
756 | ||
Retail (0.2%) | ||
CDW Corp. | 764 | 44 |
*Global Imaging Systems, Inc. | 263 | 9 |
53 | ||
Scientific Equipment & Supplies (0.0%) | ||
Newport Corp. | 438 | 6 |
Services--Commercial (0.6%) | ||
Sabre Holdings Corp. | 1,595 | 34 |
*Iron Mountain, Inc. | 1,086 | 29 |
*Convergys Corp. | 1,603 | 24 |
Hewitt Associates, Inc. | 505 | 16 |
*MPS Group, Inc. | 1,181 | 13 |
*Gartner, Inc. Class B | 906 | 9 |
*MAXIMUS, Inc. | 215 | 7 |
Pegasus Solutions Inc. | 257 | 3 |
Startek, Inc. | 167 | 3 |
Forrester Research, Inc. | 162 | 3 |
*Autobytel Inc. | 400 | 2 |
NetRatings, Inc. | 107 | 2 |
145 | ||
Telecommunications Equipment (0.4%) | ||
Plantronics, Inc. | 590 | 22 |
*Andrew Corp. | 1,725 | 21 |
*Polycom, Inc. | 1,140 | 18 |
Belden CDT Inc. | 524 | 13 |
Interdigital Communications Corp. | 613 | 11 |
Powerwave Technologies, Inc. | 1,107 | 8 |
*Arris Group Inc. | 797 | 5 |
Audiovox Corp. | 213 | 3 |
101 | ||
Utilities--Telecommunications (0.0%) | ||
*Intrado Inc. | 163 | 2 |
Wholesalers (0.1%) | ||
*Tech Data Corp. | 683 | 28 |
*Brightpoint, Inc. | 192 | 3 |
31 | ||
TOTAL COMMON STOCKS | ||
(Cost $25,853) | 23,427 | |
TEMPORARY CASH INVESTMENT (0.0%) | ||
Vanguard Market Liquidity Fund, 2.540%**--Note E | ||
(Cost $8) | 7,800 | 8 |
TOTAL INVESTMENTS (99.9%) | ||
(Cost $25,861) | 23,435 | |
OTHER ASSETS AND LIABILITIES (0.1%) | ||
Other Assets--Note B | 91 | |
Liabilities--Note E | (69) | |
22 | ||
NET ASSETS (100%) | $23,457 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
Amount (000) | |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $25,953 |
Undistributed Net Investment Income | 51 |
Accumulated Net Realized Losses | (121) |
Unrealized Depreciation | (2,426) |
NET ASSETS | $23,457 |
Admiral Shares--Net Assets | |
Applicable to 52,843 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $1,204 |
NET ASSET VALUE PER SHARE--ADMIRAL SHARES | $22.78 |
VIPER Shares--Net Assets | |
Applicable to 500,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $22,253 |
NET ASSET VALUE PER SHARE--VIPER SHARES | $44.51 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
42
Materials Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (100.2%) | ||
Agriculture-Fish & Ranch (3.3%) | ||
Monsanto Co. | 18,140 | $ 1,066 |
Aluminum (6.0%) | ||
Alcoa Inc. | 58,863 | 1,891 |
Century Aluminum Co. | 1,613 | 52 |
1,943 | ||
Building-Cement (0.7%) | ||
Lafarge North America Inc. | 2,133 | 131 |
Eagle Materials, Inc. | 666 | 56 |
Eagle Materials, Inc. B Shares | 617 | 50 |
237 | ||
Building Materials (2.5%) | ||
Vulcan Materials Co. | 6,555 | 379 |
Martin Marietta Materials, Inc. | 3,328 | 192 |
Florida Rock Industries, Inc. | 2,221 | 143 |
Texas Industries, Inc. | 1,453 | 97 |
811 | ||
Chemicals (39.3%) | ||
E.I. du Pont de Nemours & Co. | 67,042 | 3,573 |
Dow Chemical Co. | 63,726 | 3,515 |
Praxair, Inc. | 21,987 | 986 |
Air Products & Chemicals, Inc. | 15,375 | 963 |
Rohm & Haas Co. | 9,953 | 479 |
Lyondell Chemical Co. | 13,826 | 468 |
Ecolab, Inc. | 12,996 | 412 |
Eastman Chemical Co. | 5,263 | 304 |
Sigma-Aldrich Corp. | 4,472 | 276 |
Lubrizol Corp. | 4,501 | 192 |
Cabot Corp. | 4,023 | 140 |
Cytec Industries, Inc. | 2,477 | 125 |
*FMC Corp. | 2,353 | 116 |
Airgas, Inc. | 4,509 | 113 |
Georgia Gulf Corp. | 2,045 | 108 |
Crompton Corp. | 7,573 | 104 |
Albemarle Corp. | 2,615 | 99 |
Hercules, Inc. | 6,438 | 92 |
Great Lakes Chemical Corp. | 3,443 | 92 |
Huntsman Corp. | 2,244 | 64 |
OM Group, Inc. | 1,919 | 61 |
MacDermid, Inc. | 1,738 | 58 |
PolyOne Corp. | 5,819 | 53 |
*W.R. Grace & Co. | 4,467 | 44 |
Arch Chemicals, Inc. | 1,434 | 41 |
A. Schulman Inc. | 2,099 | 38 |
Cambrex Corp. | 1,637 | 37 |
Calgon Carbon Corp. | 2,449 | 21 |
Quaker Chemical Corp. | 604 | 13 |
NL Industries, Inc. | 559 | 12 |
Stepan Co. | 329 | 8 |
12,607 | ||
Coal (3.4%) | ||
Peabody Energy Corp. | 4,343 | 422 |
CONSOL Energy, Inc. | 6,013 | 276 |
Massey Energy Co. | 5,138 | 224 |
Arch Coal, Inc. | 4,108 | 183 |
1,105 | ||
Consumer Products (0.7%) | ||
International Flavors & Fragrances, Inc. | 5,356 | 221 |
Container & Package--Metal & Glass (2.0%) | ||
*Owens-Illinois, Inc. | 10,087 | 251 |
*Crown Holdings, Inc. | 11,080 | 182 |
AptarGroup Inc. | 2,403 | 124 |
Silgan Holdings, Inc. | 788 | 52 |
Greif Inc. Class A | 781 | 50 |
659 | ||
Container & Package--Paper & Plastics (5.1%) | ||
Sealed Air Corp. | 5,637 | 295 |
Smurfit-Stone Container Corp. | 17,240 | 287 |
Temple-Inland Inc. | 3,416 | 274 |
*Pactiv Corp. | 10,044 | 227 |
Bemis Co., Inc. | 6,747 | 201 |
Sonoco Products Co. | 6,259 | 182 |
Packaging Corp. of America | 4,355 | 107 |
*Graphic Packaging Corp. | 6,070 | 37 |
Myers Industries, Inc. | 1,576 | 21 |
1,631 | ||
Copper (3.7%) | ||
Phelps Dodge Corp. | 6,369 | 678 |
Freeport-McMoRan Copper & Gold, Inc. Class B | 11,894 | 497 |
1,175 | ||
Diversified Manufacturing (2.1%) | ||
Ball Corp. | 7,133 | 317 |
Engelhard Corp. | 8,316 | 252 |
Olin Corp. | 4,691 | 117 |
686 | ||
Fertilizers (0.8%) | ||
*The Mosaic Co. | 8,709 | 143 |
*Scotts Co. | 1,516 | 106 |
*Terra Industries, Inc. | 2,817 | 23 |
272 | ||
Foods (0.2%) | ||
Sensient Technologies Corp. | 2,974 | 65 |
Forest Products (6.3%) | ||
Weyerhaeuser Co. | 16,185 | 1,083 |
Georgia Pacific Group | 15,650 | 560 |
Louisiana-Pacific Corp. | 6,991 | 184 |
Potlatch Corp. | 1,930 | 89 |
Longview Fibre Co. | 3,106 | 52 |
Deltic Timber Corp. | 643 | 30 |
Pope & Talbot, Inc. | 996 | 16 |
2,014 | ||
Gold (4.5%) | ||
Newmont Mining Corp. (Holding Co.) | 30,019 | 1,351 |
Coeur d'Alene Mines Corp. | 16,327 | 65 |
Royal Gold, Inc. | 984 | 17 |
1,433 | ||
Metal Fabricating (1.1%) | ||
Commercial Metals Co. | 3,495 | 122 |
Quanex Corp. | 1,703 | 100 |
Reliance Steel & Aluminum Co. | 1,871 | 86 |
RTI International Metals, Inc. | 1,442 | 39 |
347 | ||
Metals & Minerals & Commodities (0.2%) | ||
Symyx Technologies, Inc. | 1,873 | 52 |
Metals & Minerals Miscellaneous (1.3%) | ||
Cleveland-Cliffs Inc. | 1,438 | 116 |
Minerals Technologies, Inc. | 1,397 | 88 |
Apex Silver Mines Ltd. | 2,795 | 53 |
Compass Minerals International | 1,993 | 50 |
Hecla Mining Co. | 8,150 | 46 |
Stillwater Mining Co. | 2,691 | 31 |
AMCOL International Corp. | 1,317 | 29 |
413 | ||
Miscellaneous Materials & Processing (0.3%) | ||
USEC Inc. | 5,594 | 83 |
Paints & Coating (3.9%) | ||
PPG Industries, Inc. | 11,608 | 835 |
Valspar Corp. | 3,223 | 149 |
RPM International, Inc. | 7,916 | 148 |
43
Materials Index Fund | Shares | Market Value^ (000) |
---|---|---|
Ferro Corp. | 2,829 | $55 |
H.B. Fuller Co. | 2,021 | 54 |
1,241 | ||
Paper (6.1%) | ||
International Paper Co. | 31,309 | 1,169 |
MeadWestvaco Corp. | 13,665 | 429 |
Bowater Inc. | 3,854 | 150 |
Wausau-Mosinee Paper Corp. | 3,141 | 47 |
Glatfelter | 2,603 | 39 |
*Neenah Paper Inc. | 892 | 31 |
Caraustar Industries, Inc. | 1,897 | 27 |
Buckeye Technology, Inc. | 2,102 | 25 |
Rock-Tenn Co. | 1,751 | 25 |
Chesapeake Corp. of Virginia | 1,139 | 24 |
1,966 | ||
Plastics (0.2%) | ||
Spartech Corp. | 2,216 | 49 |
Pollution Control & Environmental Service (0.3%) | ||
*Headwaters Inc. | 2,716 | 87 |
Steel (6.0%) | ||
Nucor Corp. | 10,645 | 664 |
United States Steel Corp. | 7,653 | 477 |
Allegheny Technologies Inc. | 5,485 | 135 |
Steel Dynamics, Inc. | 2,884 | 128 |
*AK Steel Corp. | 6,890 | 121 |
Worthington Industries, Inc. | 4,797 | 101 |
Carpenter Technology Corp. | 1,409 | 95 |
Oregon Steel Mills, Inc. | 2,352 | 68 |
Schnitzer Steel Industries, Inc. Class A | 1,500 | 61 |
International Steel Group, Inc. | 1,329 | 56 |
Gibraltar Industries Inc. | 1,478 | 37 |
1,943 | ||
Synthetic Fibers (0.1%) | ||
Wellman, Inc. | 2,046 | 28 |
Tobacco (0.1%) | ||
Schweitzer-Mauduit International, Inc. | 1,048 | 36 |
TOTAL INVESTMENTS | ||
(Cost $27,237) | 32,170 | |
OTHER ASSETS AND LIABILITIES (-0.2%) | ||
Other Assets--Note B | 156 | |
Liabilities | (217) | |
(61) | ||
NET ASSETS (100%) | $32,109 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $27,091 |
Undistributed Net Investment Income | 69 |
Accumulated Net Realized Gains | 16 |
Unrealized Appreciation | 4,933 |
NET ASSETS | $32,109 |
Admiral Shares--Net Assets | |
Applicable to 39,245 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $1,233 |
NET ASSET VALUE PER SHARE--ADMIRAL SHARES | $31.42 |
VIPER Shares--Net Assets | |
Applicable to 500,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $30,876 |
NET ASSET VALUE PER SHARE--VIPER SHARES | $61.75 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
44
Telecommunication Services Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (100.4%) | ||
Communications Technology (2.5%) | ||
*SpectraSite, Inc. | 4,103 | $ 254 |
Broadwing Corp. | 23,960 | 141 |
395 | ||
Computer Services Software & Systems (1.0%) | ||
*@ Road, Inc. | 35,364 | 160 |
Services--Commercial (0.8%) | ||
*Wireless Facilities, Inc. | 19,224 | 136 |
Telecommunications Equipment (4.5%) | ||
American Tower Corp. Class A | 16,155 | 296 |
*Crown Castle International Corp. | 16,198 | 265 |
SBA Communications Corp. | 16,686 | 145 |
706 | ||
Utilities--Telecommunications (91.6%) | ||
Verizon Communications Inc. | 87,903 | 3,162 |
SBC Communications Inc. | 97,585 | 2,347 |
BellSouth Corp. | 37,881 | 977 |
ALLTEL Corp. | 12,648 | 723 |
AT&T Corp. | 36,697 | 713 |
*Nextel Communications, Inc. | 24,181 | 712 |
Sprint Corp. | 30,035 | 711 |
Qwest Communications International Inc. | 94,566 | 369 |
MCI Inc. | 15,412 | 351 |
Telephone & Data Systems, Inc. | 3,700 | 324 |
Citizens Communications Co. | 23,551 | 314 |
CenturyTel, Inc. | 9,106 | 306 |
*NII Holdings Inc. | 5,018 | 287 |
*Western Wireless Corp. Class A | 7,007 | 275 |
*Nextel Partners, Inc. | 11,201 | 223 |
*USA Mobility, Inc. | 4,451 | 175 |
*Cincinnati Bell Inc. | 38,535 | 170 |
Price Communications Corp. | 9,373 | 168 |
*Commonwealth Telephone Enterprises, Inc. | 3,443 | 164 |
Level 3 Communications, Inc. | 70,207 | 164 |
U.S. Cellular Corp. | 3,247 | 162 |
*UbiquiTel Inc. | 21,499 | 161 |
*Premiere Global Services, Inc. | 15,277 | 156 |
*General Communication, Inc. | 15,800 | 147 |
North Pittsburgh Systems, Inc. | 6,150 | 143 |
Surewest Communications | 6,179 | 138 |
Centennial Communications Corp. Class A | 12,800 | 136 |
CT Communications, Inc. | 12,195 | 136 |
Time Warner Telecom Inc. | 32,850 | 132 |
Triton PCS, Inc. | 35,728 | 127 |
*Primus Telecommunications Group, Inc. | 72,676 | 126 |
Dobson Communications Corp. | 55,492 | 126 |
IDT Corp. Class B | 7,724 | 118 |
*IDT Corp. | 3,406 | 50 |
14,493 | ||
TOTAL COMMON STOCKS | ||
(Cost $16,083) | 15,890 | |
TEMPORARY CASH INVESTMENT (1.7%) | ||
Vanguard Market Liquidity Fund, 2.540%**--Note E | ||
(Cost $264) | 264,300 | 264 |
TOTAL INVESTMENTS (102.1%) | ||
(Cost $16,347) | 16,154 | |
OTHER ASSETS AND LIABILITIES (-2.1%) | ||
Other Assets--Note B | $439 | |
Payables for Investment Securities Purchased | (478) | |
Other Liabilities--Note E | (290) | |
(329) | ||
NET ASSETS (100%) | $15,825 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $15,603 |
Undistributed Net Investment Income | 131 |
Accumulated Net Realized Gains | 284 |
Unrealized Depreciation | (193) |
NET ASSETS | $15,825 |
VIPER Shares--Net Assets | |
Applicable to 300,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $15,825 |
NET ASSET VALUE PER SHARE--VIPER SHARES | $52.75 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
45
Utilities Index Fund | Shares | Market Value^ (000) |
---|---|---|
COMMON STOCKS (99.7%) | ||
Energy Miscellaneous (1.9%) | ||
*Reliant Energy, Inc. | 41,805 | $501 |
*NRG Energy | 11,223 | 432 |
*Calpine Corp. | 75,254 | 249 |
Crosstex Energy, Inc. | 426 | 18 |
1,200 | ||
Utilities--Electrical (84.1%) | ||
Exelon Corp. | 93,350 | 4,234 |
Duke Energy Corp. | 132,153 | 3,567 |
Dominion Resources, Inc. | 48,107 | 3,465 |
Southern Co. | 104,006 | 3,341 |
TXU Corp. | 32,700 | 2,493 |
Entergy Corp. | 31,496 | 2,177 |
*PG&E Corp. | 60,154 | 2,116 |
FPL Group, Inc. | 24,842 | 1,971 |
FirstEnergy Corp. | 46,472 | 1,917 |
American Electric Power Co., Inc. | 55,746 | 1,862 |
Public Service Enterprise Group, Inc. | 33,493 | 1,827 |
Consolidated Edison Inc. | 34,099 | 1,458 |
AES Corp. | 86,842 | 1,454 |
PPL Corp. | 26,636 | 1,453 |
Progress Energy, Inc. | 33,068 | 1,433 |
Ameren Corp. | 27,433 | 1,412 |
Edison International | 41,315 | 1,342 |
Constellation Energy Group, Inc. | 24,777 | 1,275 |
DTE Energy Co. | 24,510 | 1,084 |
Cinergy Corp. | 24,932 | 1,009 |
Xcel Energy, Inc. | 56,406 | 1,000 |
NiSource, Inc. | 36,914 | 836 |
Pepco Holdings, Inc. | 26,478 | 584 |
Wisconsin Energy Corp. | 16,479 | 572 |
SCANA Corp. | 15,036 | 572 |
Pinnacle West Capital Corp. | 12,796 | 534 |
Energy East Corp. | 20,558 | 529 |
CenterPoint Energy Inc. | 38,801 | 465 |
TECO Energy, Inc. | 28,955 | 460 |
DPL Inc. | 17,734 | 452 |
Alliant Energy Corp. | 15,879 | 425 |
NSTAR | 7,451 | 414 |
Allegheny Energy, Inc. | 19,339 | 366 |
Northeast Utilities | 17,904 | 334 |
CMS Energy Corp. | 27,436 | 333 |
OGE Energy Corp. | 12,537 | 325 |
Great Plains Energy, Inc. | 10,370 | 321 |
Puget Energy, Inc. | 13,891 | 318 |
Hawaiian Electric Industries Inc. | 11,243 | 299 |
Westar Energy, Inc. | 11,980 | 275 |
WPS Resources Corp. | 4,963 | 259 |
PNM Resources Inc. | 8,441 | 221 |
Duquesne Light Holdings, Inc. | 10,700 | 200 |
IDACORP, Inc. | 5,827 | 169 |
Sierra Pacific Resources | 16,398 | 164 |
ALLETE, Inc. | 3,718 | 148 |
UniSource Energy Corp. | 4,790 | 145 |
Cleco Corp. | 6,831 | 139 |
Black Hills Corp. | 4,312 | 137 |
El Paso Electric Co. | 6,655 | 133 |
Avista Corp. | 6,459 | 118 |
CH Energy Group, Inc. | 2,214 | 102 |
MGE Energy, Inc. | 2,800 | 100 |
Otter Tail Corp. | 3,845 | 97 |
UIL Holdings Corp. | 1,939 | 97 |
Empire District Electric Co. | 3,591 | 82 |
Central Vermont Public Service Corp. | 1,684 | 38 |
52,653 | ||
Utilities--Gas Distribution (10.4%) | ||
Sempra Energy | 29,595 | 1,184 |
KeySpan Corp. | 22,628 | 895 |
Questar Corp. | 11,769 | 624 |
ONEOK, Inc. | 13,017 | 381 |
AGL Resources Inc. | 9,943 | 344 |
UGI Corp. Holding Co. | 7,115 | 318 |
Southern Union Co. | 12,520 | 318 |
National Fuel Gas Co. | 10,954 | 310 |
Atmos Energy Corp. | 10,709 | 295 |
Energen Corp. | 4,573 | 295 |
Piedmont Natural Gas, Inc. | 10,749 | 251 |
NICOR Inc. | 6,180 | 230 |
Peoples Energy Corp. | 5,278 | 226 |
WGL Holdings Inc. | 6,796 | 209 |
New Jersey Resources Corp. | 3,867 | 172 |
Northwest Natural Gas Co. | 3,823 | 139 |
Southwest Gas Corp. | 4,956 | 124 |
South Jersey Industries, Inc. | 1,938 | 108 |
The Laclede Group, Inc. | 2,760 | 87 |
Cascade Natural Gas Corp. | 1,568 | 32 |
6,542 | ||
Utilities--Gas Pipelines (1.1%) | ||
Equitable Resources, Inc. | 8,668 | 514 |
Dynegy, Inc. | 39,496 | 164 |
678 | ||
Utilities--Miscellaneous (1.3%) | ||
MDU Resources Group, Inc. | 14,836 | 400 |
Vectren Corp. | 10,609 | 287 |
Aquila, Inc. | 33,093 | 118 |
805 | ||
Utilities--Water (0.9%) | ||
Aqua America, Inc. | 13,259 | 326 |
California Water Service Group | 2,424 | 83 |
American States Water Co. | 2,347 | 64 |
SJW Corp. | 880 | 31 |
Connecticut Water Services, Inc. | 1,133 | 29 |
533 | ||
TOTAL COMMON STOCKS | ||
(Cost $53,557) | 62,411 | |
TEMPORARY CASH INVESTMENT (0.3%) | ||
Vanguard Market Liquidity Fund, 2.540%**--Note E | ||
(Cost $200) | 200,000 | 200 |
TOTAL INVESTMENTS (100.0%) | ||
(Cost $53,757) | 62,611 | |
OTHER ASSETS AND LIABILITIES (0.0%) | ||
Other Assets--Note B | 800 | |
Liabilities--Note E | (823) | |
(23) | ||
NET ASSETS (100%) | $62,588 | |
^See Note A in Notes to Financial Statements. | ||
*Non-income-producing security. | ||
**Money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
46
| Amount (000) |
---|---|
AT FEBRUARY 28, 2005, NET ASSETS CONSISTED OF: | |
Paid-in Capital | $53,476 |
Undistributed Net Investment Income | 302 |
Accumulated Net Realized Losses | (44) |
Unrealized Appreciation | 8,854 |
NET ASSETS | $62,588 |
Admiral Shares--Net Assets | |
Applicable to 67,726 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $2,059 |
NET ASSET VALUE PER SHARE--ADMIRAL SHARES | $30.40 |
VIPER Shares--Net Assets | |
Applicable to 1,000,000 outstanding $.001 | |
par value shares of beneficial interest | |
(unlimited authorization) | $60,529 |
NET ASSET VALUE PER SHARE--VIPER SHARES | $60.53 |
See Note C in Notes to Financial Statements for the tax-basis components of net assets. |
47
STATEMENT OF OPERATIONS
This Statement shows the types of income earned by each fund during the reporting period, and details the operating expenses charged to each class of its shares. These expenses directly reduce the amount of investment income available to pay to shareholders as income dividends. This Statement also shows any Net Gain (Loss) realized on the sale of investments, and the increase or decrease in the Unrealized Appreciation (Depreciation) of investments during the period.
| Consumer Discretionary Index Fund | Consumer Staples Index Fund |
---|---|---|
Six Months Ended Feb. 28, 2005 | ||
| (000) | (000) |
INVESTMENT INCOME | ||
Income | ||
Dividends | $94 | $223 |
Interest | -- | -- |
Security Lending | 1 | -- |
Total Income | 95 | 223 |
Expenses | ||
The Vanguard Group--Note B | ||
Investment Advisory Services | 4 | 4 |
Management and Administrative | ||
Admiral Shares | -- | 1 |
VIPER Shares | 10 | 13 |
Marketing and Distribution | ||
Admiral Shares | -- | -- |
VIPER Shares | 1 | 2 |
Custodian Fees | 10 | 11 |
Total Expenses | 25 | 31 |
NET INVESTMENT INCOME | 70 | 192 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | 475 | (28) |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | 2,085 | 1,618 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $2,630 | $1,782 |
Energy | Financials | |
Index Fund | Index Fund | |
Sept. 23, | Six Months | |
Feb. 28, | Feb. 28, | |
(000) | (000) | |
INVESTMENT INCOME | ||
Income | ||
Dividends | $317 | $286 |
Interest | 6 | -- |
Security Lending | -- | -- |
Total Income | 323 | 286 |
Expenses | ||
The Vanguard Group--Note B | ||
Investment Advisory Services | 6 | 4 |
Management and Administrative | ||
Admiral Shares | 1 | -- |
VIPER Shares | 32 | 8 |
Marketing and Distribution | ||
Admiral Shares | -- | -- |
VIPER Shares | 3 | 2 |
Custodian Fees | 8 | 18 |
Total Expenses | 50 | 32 |
NET INVESTMENT INCOME | 273 | 254 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | 984 | 37 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | 12,221 | 648 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $13,478 | $939 |
*Inception |
48
Health Care Index Fund | Industrials Index Fund | |
---|---|---|
| Six Months Ended Feb. 28, 2005 (000) | Sept. 23, 2004* to Feb. 28, 2005 (000) |
INVESTMENT INCOME | ||
Income | ||
Dividends | $ 482 | $ 110 |
Interest | 1 | 1 |
Security Lending | -- | -- |
Total Income | 483 | 111 |
Expenses | ||
The Vanguard Group--Note B | ||
Investment Advisory Services | 12 | 3 |
Management and Administrative | ||
Admiral Shares | 14 | -- |
VIPER Shares | 15 | 2 |
Marketing and Distribution | ||
Admiral Shares | 2 | -- |
VIPER Shares | 3 | 1 |
Custodian Fees | 54 | 12 |
Total Expenses | 100 | 18 |
NET INVESTMENT INCOME | 383 | 93 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | 17 | 1,155 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | 3,492 | 1,004 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $3,892 | $2,252 |
*Inception | ||
Information | ||
Technology | Materials | |
Index Fund | Index Fund | |
Six Months Ended Feb. 28, 2005 | ||
| (000) | (000) |
INVESTMENT INCOME | ||
Income | ||
Dividends | $ 315 | $ 268 |
Interest | -- | 1 |
Security Lending | -- | -- |
Total Income | 315 | 269 |
Expenses | ||
The Vanguard Group--Note B | ||
Investment Advisory Services | 3 | 5 |
Management and Administrative | ||
Admiral Shares | -- | 1 |
VIPER Shares | 8 | 20 |
Marketing and Distribution | ||
Admiral Shares | -- | -- |
VIPER Shares | 2 | 2 |
Custodian Fees | 13 | 8 |
Total Expenses | 26 | 36 |
NET INVESTMENT INCOME | 289 | 233 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | (49) | 1,040 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | 1,715 | 4,102 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $1,955 | $5,375 |
49
STATEMENT OF OPERATIONS (CONTINUED) | ||
---|---|---|
| ||
| Telecommunication Services Index Fund | Utilities Index Fund |
| Sept. 23, 2004* to Feb. 28, 2005 (000) | Six Months Ended Feb. 28, 2005 (000) |
INVESTMENT INCOME | ||
Income | ||
Dividends | $ 274 | $ 884 |
Interest | -- | 1 |
Security Lending | 7 | 1 |
Total Income | 281 | 886 |
Expenses | ||
The Vanguard Group--Note B | ||
Investment Advisory Services | 5 | 9 |
Management and Administrative | ||
Admiral Shares | -- | 1 |
VIPER Shares | 13 | 40 |
Marketing and Distribution | ||
Admiral Shares | -- | -- |
VIPER Shares | 2 | 4 |
Custodian Fees | 7 | 13 |
Total Expenses | 27 | 67 |
NET INVESTMENT INCOME | 254 | 819 |
REALIZED NET GAIN (LOSS) ON INVESTMENT SECURITIES SOLD | 2,697 | 95 |
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENT SECURITIES | (193) | 6,622 |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $2,758 | $7,536 |
*Inception |
50
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how each fund’s total net assets changed during the two most recent reporting periods. The Operations section summarizes information detailed in the Statement of Operations. The amounts shown as Distributions to shareholders from the fund’s net income and capital gains may not match the amounts shown in the Operations section, because distributions are determined on a tax basis and may be made in a period different from the one in which the income was earned or the gains were realized on the financial statements. The Capital Share Transactions section shows the net amount shareholders invested in or redeemed from the fund. Distributions and Capital Share Transactions are shown separately for each class of shares.
| Consumer Discretionary Index Fund | Consumer Staples Index Fund | ||
---|---|---|---|---|
| Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) | Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) |
INCREASE (DECREASE) IN NET ASSETS | ||||
Operations | ||||
Net Investment Income | $70 | $79 | $192 | 195 |
Realized Net Gain (Loss) | 475 | (30) | (28) | 101 |
Change in Unrealized Appreciation (Depreciation) | 2,085 | (1,299) | 1,618 | 268 |
Net Increase (Decrease) in Net Assets | ||||
Resulting from Operations | 2,630 | (1,250) | 1,782 | 564 |
Distributions | ||||
Net Investment Income | ||||
Admiral Shares | -- | -- | (16) | -- |
VIPER Shares | (105) | -- | (341) | -- |
Realized Capital Gain | ||||
Admiral Shares | -- | -- | (4) | -- |
VIPER Shares | -- | -- | (96) | -- |
Total Distributions | (105) | -- | (457) | -- |
Capital Share Transactions--Note F | ||||
Admiral Shares | -- | -- | 613 | 843 |
VIPER Shares | (5,410) | 20,045 | 5,543 | 20,336 |
Net Increase (Decrease) from Capital Share Transactions | (5,410) | 20,045 | 6,156 | 21,179 |
Total Increase (Decrease) | (2,885) | 18,795 | 7,481 | 21,743 |
Net Assets | ||||
Beginning of Period | 18,795 | -- | 21,743 | -- |
End of Period | $15,910 | $18,795 | $29,224 | $21,743 |
*Inception | ||||
Energy | Financials | |||
Index Fund | Index Fund | |||
Sept. 23, 2004* to | Six Months Ended | Jan. 26* to | ||
Feb. 28, 2005 | Feb. 28, 2005 | Aug. 31, 2005 | ||
(000) | (000) | (000) | ||
INCREASE (DECREASE) IN NET ASSETS | ||||
Operations | ||||
Net Investment Income | $273 | 254 | $290 | |
Realized Net Gain (Loss) | 984 | 37 | 5 | |
Change in Unrealized Appreciation (Depreciation) | 12,221 | 648 | (273) | |
Net Increase (Decrease) in Net Assets | ||||
Resulting from Operations | 13,478 | 939 | 22 | |
Distributions | ||||
Net Investment Income | ||||
Admiral Shares | (2) | (18) | -- | |
VIPER Shares | (130) | (574) | -- | |
Realized Capital Gain | ||||
Admiral Shares | -- | -- | -- | |
VIPER Shares | -- | -- | -- | |
Total Distributions | (132) | (592) | -- | |
Capital Share Transactions--Note F | ||||
Admiral Shares | 6,665 | 66 | 765 | |
VIPER Shares | 63,352 | 5,445 | 20,207 | |
Net Increase (Decrease) from Capital Share Transactions | 70,017 | 5,511 | 20,972 | |
Total Increase (Decrease) | 83,363 | 5,858 | 20,994 | |
Net Assets | ||||
Beginning of Period | -- | 20,994 | -- | |
End of Period | $83,363 | $26,852 | $20,994 | |
*Inception |
51
(000)
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED) | ||||
---|---|---|---|---|
| ||||
| Health Care Index Fund | Industrials Index Fund | ||
| Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) | Sept. 23, 2004* to Feb. 28, 2005 (000) | |
INCREASE (DECREASE) IN NET ASSETS | ||||
Operations | ||||
Net Investment Income | $383 | $153 | $93 | |
Realized Net Gain (Loss) | 17 | (7) | 1,155 | |
Change in Unrealized Appreciation (Depreciation) | 3,492 | (1,178) | 1,004 | |
Net Increase (Decrease) in Net Assets | ||||
Resulting from Operations | 3,892 | (1,032) | 2,252 | |
Distributions | ||||
Net Investment Income | ||||
Admiral Shares | (182) | -- | -- | |
VIPER Shares | (133) | -- | (64) | |
Realized Capital Gain | ||||
Admiral Shares | -- | -- | -- | |
VIPER Shares | -- | -- | -- | |
Total Distributions | (315) | -- | (64) | |
Capital Share Transactions--Note F | ||||
Admiral Shares | 40,509 | 11,260 | -- | |
VIPER Shares | 53,481 | 20,217 | 8,618 | |
Net Increase (Decrease) from Capital Share Transactions | 93,990 | 31,477 | 8,618 | |
Total Increase (Decrease) | 97,567 | 30,445 | 10,806 | |
Net Assets | ||||
Beginning of Period | 30,445 | -- | -- | |
End of Period | $128,012 | $30,445 | $10,806 | |
*Inception | ||||
| Information Technology Index Fund | Materials Index Fund | ||
---|---|---|---|---|
| Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) | Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) |
INCREASE (DECREASE) IN NET ASSETS | ||||
Operations | ||||
Net Investment Income | $289 | $12 | $233 | $237 |
Realized Net Gain (Loss) | (49) | (72) | 1,040 | (11) |
Change in Unrealized Appreciation (Depreciation) | 1,715 | (4,141) | 4,102 | 831 |
Net Increase (Decrease) in Net Assets | ||||
Resulting from Operations | 1,955 | (4,201) | 5,375 | 1,057 |
Distributions | ||||
Net Investment Income | ||||
Admiral Shares | (6) | -- | (11) | -- |
VIPER Shares | (244) | -- | (390) | -- |
Realized Capital Gain | ||||
Admiral Shares | -- | -- | -- | -- |
VIPER Shares | -- | -- | -- | -- |
Total Distributions | (250) | -- | (401) | -- |
Capital Share Transactions--Note F | ||||
Admiral Shares | 951 | 250 | 567 | 531 |
VIPER Shares | 4,396 | 20,356 | 5,181 | 19,799 |
Net Increase (Decrease) from Capital Share Transactions | 5,347 | 20,606 | 5,748 | 20,330 |
Total Increase (Decrease) | 7,052 | 16,405 | 10,722 | 21,387 |
Net Assets | ||||
Beginning of Period | 16,405 | -- | 21,387 | -- |
End of Period | $23,457 | $16,405 | $32,109 | $21,387 |
*Inception |
52
Telecommunication Services Index Fund | Utilities Index Fund | ||
---|---|---|---|
| Sept. 23, 2004* to Feb. 28, 2005 (000) | Six Months Ended Feb. 28, 2005 (000) | Jan. 26* to Aug. 31, 2004 (000) |
INCREASE (DECREASE) IN NET ASSETS | |||
Operations | |||
Net Investment Income | $254 | $819 | $901 |
Realized Net Gain (Loss) | 2,697 | 95 | (139) |
Change in Unrealized Appreciation (Depreciation) | (193) | 6,622 | 2,232 |
Net Increase (Decrease) in Net Assets | |||
Resulting from Operations | 2,758 | 7,536 | 2,994 |
Distributions | |||
Net Investment Income | |||
Admiral Shares | -- | (27) | -- |
VIPER Shares | (123) | (1,391) | -- |
Realized Capital Gain | |||
Admiral Shares | -- | -- | -- |
VIPER Shares | -- | -- | -- |
Total Distributions | (123) | (1,418) | -- |
Capital Share Transactions--Note F | |||
Admiral Shares | -- | 1,395 | 527 |
VIPER Shares | 13,190 | 11,986 | 39,568 |
Net Increase (Decrease) from Capital Share Transactions | 13,190 | 13,381 | 40,095 |
Total Increase (Decrease) | 15,825 | 19,499 | 43,089 |
Net Assets | |||
Beginning of Period | -- | 43,089 | -- |
End of Period | $15,825 | $62,588 | $43,089 |
*Inception |
53
FINANCIAL HIGHLIGHTS
This table summarizes each fund’s investment results and distributions to shareholders on a per-share basis for each class of shares. It also presents the Total Return and shows net investment income and expenses as percentages of average net assets. These data will help you assess: the variability of the fund’s net income and total returns from year to year; the relative contributions of net income and capital gains to the fund’s total return; how much it costs to operate the fund; and the extent to which the fund tends to distribute capital gains. The table also shows the Portfolio Turnover Rate, a measure of trading activity. A turnover rate of 100% means that the average security is held in the fund for one year.
Consumer Discretionary Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $46.99 | $50.09 |
Investment Operations | ||
Net Investment Income | .20‡ | .20 |
Net Realized and Unrealized Gain (Loss) on Investments | 6.19 | (3.30) |
Total from Investment Operations | 6.39 | (3.10) |
Distributions | ||
Dividends from Net Investment Income | (.35) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.35) | -- |
Net Asset Value, End of Period | $53.03 | $46.99 |
Total Return | 13.58% | -6.19% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $16 | $19 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 0.77%** | 0.68%** |
Portfolio Turnover Rate† | 17%** | 11% |
Consumer Staples Index Fund Admiral Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 30* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $25.82 | $25.00 |
Investment Operations | ||
Net Investment Income | .220 | .24 |
Net Realized and Unrealized Gain (Loss) on Investments | 1.869 | .58 |
Total from Investment Operations | 2.089 | .82 |
Distributions | ||
Dividends from Net Investment Income | (.440) | -- |
Distributions from Realized Capital Gains | (.119) | -- |
Total Distributions | (.559) | -- |
Net Asset Value, End of Period | $27.35 | $25.82 |
Total Return†† | 8.14% | 3.28% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $2 | $1 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.72%** | 1.51%** |
Portfolio Turnover Rate† | 16%** | 20% |
Consumer Staples Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $52.28 | $50.84 |
Investment Operations | ||
Net Investment Income | .443 | .47 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.801 | .97 |
Total from Investment Operations | 4.244 | 1.44 |
Distributions | ||
Dividends from Net Investment Income | (.853) | -- |
Distributions from Realized Capital Gains | (.241) | -- |
Total Distributions | (1.094) | -- |
Net Asset Value, End of Period | $55.43 | $52.28 |
Total Return | 8.16% | 2.83% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $28 | $21 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.73%** | 1.51%** |
Portfolio Turnover Rate† | 16%** | 20% |
*Inception. | ||
**Annualized. | ||
† Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. | ||
†† Total returns do not reflect the 2% fee assessed on redemptions of shares held for less than one year. | ||
‡ Calculated based on average shares outstanding. |
54
Energy Index Fund Admiral Shares | |
---|---|
For a Share Outstanding Throughout the Period | Oct. 7, 2004* to Feb. 28, 2005 |
Net Asset Value, Beginning of Period | $25.98 |
Investment Operations | |
Net Investment Income | .169 |
Net Realized and Unrealized Gain (Loss) on Investments | 5.622 |
Total from Investment Operations | 5.791 |
Distributions | |
Dividends from Net Investment Income | (.111) |
Distributions from Realized Capital Gains | -- |
Total Distributions | (.111) |
Net Asset Value, End of Period | $31.66 |
Total Return† | 22.37% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $7 |
Ratio of Total Expenses to Average Net Assets | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.53%** |
Portfolio Turnover Rate†† | 10%** |
Energy Index Fund | |
VIPER Shares | |
Sept. 23, 2004* | |
For a Share Outstanding Throughout the Period | to Feb.28, 2005 |
Net Asset Value, Beginning of Period | $49.24 |
Investment Operations | |
Net Investment Income | .323 |
Net Realized and Unrealized Gain (Loss) on Investments | 14.083 |
Total from Investment Operations | 14.406 |
Distributions | |
Dividends from Net Investment Income | (.216) |
Distributions from Realized Capital Gains | -- |
Total Distributions | (.216) |
Net Asset Value, End of Period | $63.43 |
Total Return | 29.35% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $76 |
Ratio of Total Expenses to Average Net Assets | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.53%** |
Portfolio Turnover Rate†† | 10%** |
Financials Index Fund Admiral Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Feb. 4* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $25.35 | $24.90 |
Investment Operations | ||
Net Investment Income | .287‡ | .31 |
Net Realized and Unrealized Gain (Loss) on Investments | 1.014 | .14 |
Total from Investment Operations | 1.301 | .45 |
Distributions | ||
Dividends from Net Investment Income | (.581) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.581) | -- |
Net Asset Value, End of Period | $26.07 | $25.35 |
Total Return† | 5.08% | 1.81% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $1 | $1 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 2.30%** | 2.38%** |
Portfolio Turnover Rate†† | 7%** | 9% |
Financials Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $50.57 | $50.51 |
Investment Operations | ||
Net Investment Income | .551‡ | .70 |
Net Realized and Unrealized Gain (Loss) on Investments | 2.037 | (.64) |
Total from Investment Operations | 2.588 | .06 |
Distributions | ||
Dividends from Net Investment Income | (1.148) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (1.148) | -- |
Net Asset Value, End of Period | $52.01 | $50.57 |
Total Return | 5.05% | 0.12% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $26 | $20 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 2.31%** | 2.38%** |
Portfolio Turnover Rate†† | 7%** | 9% |
*Inception. | ||
**Annualized. | ||
† Total returns do not reflect the 2% fee assessed on redemptions of shares held for less than one year. | ||
††Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. | ||
‡ Calculated based on average shares outstanding. |
55
FINANCIAL HIGHLIGHTS (CONTINUED) | ||
---|---|---|
Health Care Index Fund Admiral Shares | ||
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Feb. 5* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $23.97 | $25.33 |
Investment Operations | ||
Net Investment Income | .120‡ | .13 |
Net Realized and Unrealized Gain (Loss) on Investments | .986 | (1.49) |
Total from Investment Operations | 1.106 | (1.36) |
Distributions | ||
Dividends from Net Investment Income | (.086) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.086) | -- |
Net Asset Value, End of Period | $24.99 | $23.97 |
Total Return† | 4.62% | -5.37% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $53 | $11 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.04%** | 1.09%** |
Portfolio Turnover Rate†† | 23%** | 8% |
Health Care Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $47.90 | $50.55 |
Investment Operations | ||
Net Investment Income | .264‡ | .23 |
Net Realized and Unrealized Gain (Loss) on Investments | 1.949 | (2.88) |
Total from Investment Operations | 2.213 | (2.65) |
Distributions | ||
Dividends from Net Investment Income | (.133) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.133) | -- |
Net Asset Value, End of Period | $49.98 | $47.90 |
Total Return | 4.62% | -5.24% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $75 | $19 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.05%** | 1.09%** |
Portfolio Turnover Rate†† | 23%** | 8% |
Industrials Index Fund VIPER Shares | |
---|---|
For a Share Outstanding Throughout the Period | Sept 23, 2004* to Feb. 28, 2005 |
Net Asset Value, Beginning of Period | $48.79 |
Investment Operations | |
Net Investment Income | .29‡ |
Net Realized and Unrealized Gain (Loss) on Investments | 5.27 |
Total from Investment Operations | 5.56 |
Distributions | |
Dividends from Net Investment Income | (.32) |
Distributions from Realized Capital Gains | -- |
Total Distributions | (.32) |
Net Asset Value, End of Period | $54.03 |
Total Return | 11.38% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $11 |
Ratio of Total Expenses to Average Net Assets | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.43%** |
Portfolio Turnover Rate†† | 6%** |
*Inception. | |
**Annualized. | |
†Total returns do not reflect the 2% fee assessed on redemptions of shares held for less than one year. | |
††Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund's capital shares, including VIPER Creation Units. | |
‡Calculated based on average shares outstanding. |
56
Information Technology Index Fund Admiral Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Mar. 25* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $20.72 | $23.40 |
Investment Operations | ||
Net Investment Income | 0.359^ | .01 |
Net Realized and Unrealized Gain (Loss) on Investments | 2.024 | (2.69) |
Total from Investment Operations | 2.383 | (2.68) |
Distributions | ||
Dividends from Net Investment Income | (0.323) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (0.323) | -- |
Net Asset Value, End of Period | $22.78 | $20.72 |
Total Return† | 11.43% | -11.45% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $1 | $0.2 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.62%o** | 0.12%** |
Portfolio Turnover Rate | 6%** | 9% |
^Net investment income per share and the ratio of net investment income to average net assets include $.284 and 1.40%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. | ||
Information Technology Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $40.46 | $50.89 |
Investment Operations | ||
Net Investment Income | 0.675^ | .03 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.984 | (10.46) |
Total from Investment Operations | 4.659 | (10.43) |
Distributions | ||
Dividends from Net Investment Income | (0.609) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (0.609) | -- |
Net Asset Value, End of Period | $44.51 | $40.46 |
Total Return | 11.44% | -20.50% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $22 | $16 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.63%o** | 0.12%** |
Portfolio Turnover Rate | 6%** | 9% |
^Net investment income per share and the ratio of net investment income to average net assets include $.553 and 1.40%, respectively, resulting from a special dividend from Microsoft Corp. in November 2004. | ||
Materials Index Fund Admiral Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Feb. 11* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $26.53 | $26.14 |
Investment Operations | ||
Net Investment Income | 0.28 | .24 |
Net Realized and Unrealized Gain (Loss) on Investments | 5.11 | .15 |
Total from Investment Operations | 5.39 | .39 |
Distributions | ||
Dividends from Net Investment Income | (0.50) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (0.50) | -- |
Net Asset Value, End of Period | $31.42 | $26.53 |
Total Return† | 20.41% | 1.49% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $1 | $1 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.78%** | 1.93%** |
Portfolio Turnover Rate†† | 6%** | 8% |
Materials Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $52.13 | $49.48 |
Investment Operations | ||
Net Investment Income | 0.529 | .58 |
Net Realized and Unrealized Gain (Loss) on Investments | 10.066 | 2.07 |
Total from Investment Operations | 10.595 | 2.65 |
Distributions | ||
Dividends from Net Investment Income | (.975) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.975) | -- |
Net Asset Value, End of Period | $61.75 | $52.13 |
Total Return | 20.42% | 5.36% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $31 | $21 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 1.79%** | 1.93%** |
Portfolio Turnover Rate†† | 6%** | 8% |
*Inception. | ||
**Annualized. | ||
† Total returns do not reflect the 2% fee assessed on redemptions of shares held for less than one year. | ||
†† Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including VIPER Creation Units. |
57
FINANCIAL HIGHLIGHTS (CONTINUED) | |
---|---|
Telecommunication Services Index Fund VIPER Shares | |
For a Share Outstanding Throughout the Period | Sep. 23, 2004* to Feb. 28, 2005 |
Net Asset Value, Beginning of Period | $49.50 |
Investment Operations | |
Net Investment Income | .57‡ |
Net Realized and Unrealized Gain (Loss) | |
on Investments | 3.09 |
Total from Investment Operations | 3.66 |
Distributions | |
Dividends from Net Investment Income | (.41) |
Distributions from Realized Capital Gains | -- |
Total Distributions | (.41) |
Net Asset Value, End of Period | $52.75 |
Total Return | 7.36% |
Ratios/Supplemental Data | |
Net Assets, End of Period (Millions) | $16 |
Ratio of Total Expenses to Average Net Assets | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 2.56%** |
Portfolio Turnover Rate† | 41%** |
Utilities Index Fund Admiral Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Apr. 28* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $26.70 | $25.03 |
Investment Operations | ||
Net Investment Income | .455‡ | .36 |
Net Realized and Unrealized Gain (Loss) on Investments | 4.030 | 1.31 |
Total from Investment Operations | 4.485 | 1.67 |
Distributions | ||
Dividends from Net Investment Income | (.785) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (.785) | -- |
Net Asset Value, End of Period | $30.40 | $26.70 |
Total Return†† | 16.90% | 6.67% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $2 | $1 |
Ratio of Total Expenses to Average Net Assets | 0.28%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 3.33%** | 3.82%** |
Portfolio Turnover Rate† | 10%** | 7% |
Utilities Index Fund VIPER Shares | ||
---|---|---|
For a Share Outstanding Throughout Each Period | Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 |
Net Asset Value, Beginning of Period | $53.14 | $49.64 |
Investment Operations | ||
Net Investment Income | .938‡ | 1.11 |
Net Realized and Unrealized Gain (Loss) on Investments | 7.998 | 2.39 |
Total from Investment Operations | 8.936 | 3.50 |
Distributions | ||
Dividends from Net Investment Income | (1.546) | -- |
Distributions from Realized Capital Gains | -- | -- |
Total Distributions | (1.546) | -- |
Net Asset Value, End of Period | $60.53 | $53.14 |
Total Return | 16.91% | 7.05% |
Ratios/Supplemental Data | ||
Net Assets, End of Period (Millions) | $61 | $43 |
Ratio of Total Expenses to Average Net Assets | 0.27%** | 0.28%** |
Ratio of Net Investment Income to Average Net Assets | 3.34%** | 3.82%** |
Portfolio Turnover Rate† | 10%** | 7% |
SEE ACCOMPANYING NOTES, WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. | ||
*Inception. | ||
**Annualized. | ||
†Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund's capital shares, including VIPER Creation Units. | ||
††Total returns do not reflect the 2% fee assessed on redemptions of shares held for less than one year. | ||
‡Calculated based on average shares outstanding. |
58
NOTES TO FINANCIAL STATEMENTS
Vanguard U.S. Sector Index Funds comprise the Consumer Discretionary, Consumer Staples, Energy, Financials, Health Care, Industrials, Information Technology, Materials, Telecommunication Services, and Utilities Index Funds, each of which is registered under the Investment Company Act of 1940 as an open-end investment company, or mutual fund. The funds offer two classes of shares, Admiral Shares and VIPER Shares. Admiral Shares are available to any investor who meets the fund's minimum purchase requirements. The Consumer Discretionary, Industrials, and Telecommunication Services Index Funds have not issued any Admiral Shares through February 28, 2005. The Energy, Industrials, and Telecommunication Services Index Fund VIPER Shares were first issued on September 23, 2004, and first offered to the public on September 29, 2004. VIPER Shares are listed for trading on the American Stock Exchange; they can be purchased and sold through a broker.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S. mutual funds. The funds consistently follow such policies in preparing their financial statements.
1. Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been materially affected by events occurring before the funds' pricing time but after the close of the securities' primary markets, are valued by methods deemed by the board of trustees to represent fair value. Investments in Vanguard Market Liquidity Fund are valued at that fund's net asset value. Temporary cash investments acquired over 60 days to maturity are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Other temporary cash investments are valued at amortized cost, which approximates market value.
2. Federal Income Taxes: Each fund intends to continue to qualify as a regulated investment company and distribute all of its taxable income. Accordingly, no provision for federal income taxes is required in the financial statements.
3. Distributions: Distributions to shareholders are recorded on the ex-dividend date.
4. Security Lending: The funds may lend their securities to qualified institutional borrowers to earn additional income. Security loans are required to be secured at all times by collateral at least equal to the market value of securities loaned. The funds invest cash collateral received in Vanguard Market Liquidity Fund, and record a liability for the return of the collateral, during the period the securities are on loan. Security lending income represents the income earned on investing cash collateral, less expenses associated with the loan.
5. Other: Dividend income is recorded on the ex-dividend date. Interest income includes income distributions received from Vanguard Market Liquidity Fund and is accrued daily. Security transactions are accounted for on the date securities are bought or sold. Costs used to determine realized gains (losses) on the sale of investment securities are those of the specific securities sold. Fees assessed on redemptions of Admiral Shares are credited to paid-in capital.
Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees. Income, other non-class-specific expenses, and realized and unrealized gains and losses on investments are allocated to each class of shares based on its relative net assets.
B. The Vanguard Group furnishes at cost investment advisory, corporate management, administrative, marketing, and distribution services. The costs of such services are allocated to each fund under methods approved by the board of trustees. Each fund has committed to provide up to 0.40% of its net assets in capital contributions to Vanguard. At February 28, 2005, the funds had contributed capital to Vanguard (included in Other Assets) of:
Index Fund | Capital Contribution to Vanguard (000) | Percentage of Fund Net Assets | Percentage of Vanguard's Capitalization |
---|---|---|---|
Consumer Discretionary | $2 | 0.01% | -- |
Consumer Staples | 3 | 0.01 | -- |
Financials | 3 | 0.01 | -- |
Health Care | 15 | 0.01 | 0.01% |
Industrials | 1 | -- | -- |
Information Technology | 3 | 0.01 | -- |
Materials | 3 | 0.01 | -- |
Telecommunication Services | 2 | 0.01 | -- |
Utilities | 7 | 0.01 | 0.01 |
The funds’ trustees and officers are also directors and officers of Vanguard.
C. Distributions are determined on a tax basis and may differ from net investment income and realized capital gains for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain, or loss are recognized in different periods for financial statement and tax purposes; these differences will reverse at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.
During the six months ended February 28, 2005, the Consumer Discretionary, Energy, Industrials, Materials, and Telecommunication Services Index Funds realized $516,000, $924,000, $1,104,000, $1,013,000, and $2,413,000, respectively, of net capital gains resulting from in-kind redemptions—in which shareholders exchanged fund shares for securities held by the fund rather than for cash. Because such gains are not taxable to the funds, and are not distributed to shareholders, they have been reclassified from accumulated net realized gains to paid-in capital.
The funds’ tax-basis capital gains and losses are determined only at the end of each fiscal year. For tax purposes, at August 31, 2004, the following funds had tax-basis capital losses available to offset future net capital gains:
Capital Losses | ||
---|---|---|
Index Fund | Amount (000) | Expiration: Fiscal Year Ending August 31, |
Consumer Discretionary | $30 | 2013 |
Health Care | 7 | 2013 |
Information Technology | 72 | 2013 |
Materials | 11 | 2013 |
59
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
At February 28, 2005, net unrealized appreciation (depreciation) of investment securities for tax purposes was:
(000) | |||
---|---|---|---|
Index Fund | Appreciated Securities | Depreciated Securities | Net Unrealized Appreciation (Depreciation) |
Consumer Discretionary | 1,516 | (730) | 786 |
Consumer Staples | 2,545 | (659) | 1,886 |
Energy | 12,241 | (20) | 12,221 |
Financials | 1,360 | (985) | 375 |
Health Care | 7,149 | (4,835) | 2,314 |
Industrials | 1,049 | (45) | 1,004 |
Information Technology | 1,097 | (3,523) | (2,426) |
Materials | 5,353 | (420) | 4,933 |
Telecommunication Services | 762 | (955) | (193) |
Utilities | 9,069 | (215) | 8,854 |
D. During the six months ended February 28, 2005, purchases and sales of investment securities other than temporary cash investments were:
(000) | ||
---|---|---|
Index Fund | Purchases | Sales |
Consumer Discretionary | $ 11,262 | $16,751 |
Consumer Staples | 7,819 | 1,840 |
Energy | 82,529 | 12,675 |
Financials | 6,321 | 1,138 |
Health Care | 102,289 | 8,447 |
Industrials | 19,947 | 11,273 |
Information Technology | 5,964 | 547 |
Materials | 12,314 | 6,708 |
Telecommunication Services | 44,394 | 31,008 |
Utilities | 14,958 | 2,387 |
E. The market value of securities on loan to broker/dealers at February 28, 2005, and collateral received with respect to such loans were:
(000) | ||
---|---|---|
Index Fund | Market Value of Loaned Securities | Cash Collateral Received |
Consumer Staples | $ 3 | $ 10 |
Financials | 53 | 57 |
Health Care | 8 | 11 |
Information Technology | 3 | 8 |
Telecommunication Services | 226 | 264 |
Utilities | 166 | 200 |
F. Capital share transactions for each class of shares were:
Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 | |||||
---|---|---|---|---|---|---|
Index Fund | | Amount (000) | Shares (000) | | Amount (000) | Shares (000) |
Consumer Discretionary | ||||||
VIPER Shares | ||||||
Issued | $ 9,680 | 200 | $20,045 | 400 | ||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | ||
Redeemed | (15,090) | (300) | -- | -- | ||
Net Increase (Decrease)-- | ||||||
VIPER Shares | (5,410) | (100) | 20,045 | 400 | ||
Consumer Staples | ||||||
Admiral Shares | ||||||
Issued | 875 | 33 | $843 | 32 | ||
Issued in Lieu of Cash Distributions | 12 | -- | -- | -- | ||
Redeemed | (274) | (10) | -- | -- | ||
Net Increase (Decrease)-- | ||||||
Admiral Shares | 613 | 23 | 843 | 32 | ||
VIPER Shares | ||||||
Issued | 5,543 | 100 | 20,336 | 400 | ||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | ||
Redeemed | -- | -- | -- | -- | ||
Net Increase (Decrease)-- | ||||||
VIPER Shares | 5,543 | 100 | 20,336 | 400 | ||
Energy** | ||||||
Admiral Shares | ||||||
Issued | 6,663 | 229 | -- | -- | ||
Issued in Lieu of Cash Distributions | 2 | -- | -- | -- | ||
Redeemed | -- | -- | -- | -- | ||
Net Increase (Decrease)-- | ||||||
Admiral Shares | 6,665 | 229 | -- | -- | ||
VIPER Shares | ||||||
Issued | 74,162 | 1,400 | -- | -- | ||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | ||
Redeemed | (10,810) | (200) | -- | -- | ||
Net Increase (Decrease)-- | ||||||
VIPER Shares | 63,352 | 1,200 | -- | -- | ||
Financials | ||||||
Admiral Shares | ||||||
Issued | $309 | 11 | $765 | 30 | ||
Issued in Lieu of Cash Distributions | 18 | 1 | -- | -- | ||
Redeemed | (261) | (10) | -- | -- | ||
Net Increase (Decrease)-- | ||||||
Admiral Shares | 66 | 2 | 765 | 30 | ||
VIPER Shares | ||||||
Issued | 5,445 | 100 | 20,207 | 400 | ||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | ||
Redeemed | -- | -- | -- | -- | ||
Net Increase (Decrease)-- | ||||||
VIPER Shares | 5,445 | 100 | 20,207 | 400 | ||
Health Care | ||||||
Admiral Shares | ||||||
Issued | $41,454 | 1,691 | $11,439 | 479 | ||
Issued in Lieu of Cash Distributions | 40 | 2 | -- | -- | ||
Redeemed | (985) | (41) | (179) | (8) | ||
Net Increase (Decrease)-- | ||||||
Admiral Shares | 40,509 | 1,652 | 11,260 | 471 | ||
VIPER Shares | ||||||
Issued | 53,481 | 1,100 | 20,217 | 400 | ||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | ||
Redeemed | -- | -- | -- | -- | ||
Net Increase (Decrease)-- | ||||||
VIPER Shares | 53,481 | 1,100 | 20,217 | 400 | ||
60
Six Months Ended Feb. 28, 2005 | Jan. 26* to Aug. 31, 2004 | ||||||
---|---|---|---|---|---|---|---|
Index Fund | Amount (000) | Shares (000) | | Amount (000) | Shares (000) | ||
Industrials** | |||||||
VIPER Shares | |||||||
Issued | $19,516 | 400 | -- | -- | |||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | |||
Redeemed | (10,898) | (200) | -- | -- | |||
Net Increase (Decrease)-- | |||||||
VIPER Shares | 8,618 | 200 | -- | -- | |||
Information Technology | |||||||
Admiral Shares | |||||||
Issued | $ 945 | 42 | $ 250 | 11 | |||
Issued in Lieu of Cash Distributions | 6 | -- | -- | -- | |||
Redeemed | -- | -- | -- | -- | |||
Net Increase (Decrease)-- | |||||||
Admiral Shares | 951 | 42 | 250 | 11 | |||
VIPER Shares | |||||||
Issued | 4,396 | 100 | 20,356 | 400 | |||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | |||
Redeemed | -- | -- | -- | -- | |||
Net Increase (Decrease)-- | |||||||
VIPER Shares | 4,396 | 100 | 20,356 | 400 | |||
Materials | |||||||
Admiral Shares | |||||||
Issued | $ 556 | 19 | $ 872 | 33 | |||
Issued in Lieu of Cash Distributions | 11 | -- | -- | -- | |||
Redeemed | -- | -- | (341) | (13) | |||
Net Increase (Decrease)-- | |||||||
Admiral Shares | 567 | 19 | 531 | 20 | |||
VIPER Shares | |||||||
Issued | 11,081 | 200 | 19,799 | 400 | |||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | |||
Redeemed | (5,900) | (100) | -- | -- | |||
Net Increase (Decrease)-- | |||||||
VIPER Shares | 5,181 | 100 | 19,799 | 400 | |||
Telecommunication Services** | |||||||
VIPER Shares | |||||||
Issued | $40,420 | 800 | -- | -- | |||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | |||
Redeemed | (27,230) | (500) | -- | -- | |||
Net Increase (Decrease)-- | |||||||
VIPER Shares | 13,190 | 300 | -- | -- | |||
Utilities | |||||||
Admiral Shares | |||||||
Issued | $ 1,368 | 45 | $ 527 | 22 | |||
Issued in Lieu of Cash Distributions | 27 | 1 | -- | -- | |||
Redeemed | -- | -- | -- | -- | |||
Net Increase (Decrease)-- | |||||||
Admiral Shares | 1,395 | 46 | 527 | 22 | |||
VIPER Shares | |||||||
Issued | 11,986 | 200 | 39,568 | 800 | |||
Issued in Lieu of Cash Distributions | -- | -- | -- | -- | |||
Redeemed | -- | -- | -- | -- | |||
Net Increase (Decrease)-- | |||||||
VIPER Shares | 11,986 | 200 | 39,568 | 800 | |||
*Inception. | |||||||
**Inception date for Energy, Industrials, and Telecommunication Services was September 23, 2004. |
61
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INVEST WITH VANGUARD FOR YOUR RETIREMENT | |
Vanguard offers low-cost, high-quality solutions that combine a variety of investment choices to help you achieve your retirement goals. | |
A Vanguard traditional IRA enables you to make deductible or nondeductible contributions that can grow tax-deferred until you take distributions in retirement, while a Vanguard Roth IRA allows you to make nondeductible contributions with tax-free withdrawals when you take qualified distributions. | |
With either type of Vanguard IRA®, your investment options include: | |
• Vanguard mutual funds | |
Select from our comprehensive lineup of more than 70 low-cost mutual funds suitable for retirement investing—all with no sales commissions—to help you reach your retirement goals. We offer a broad selection of stock, bond, balanced, and money market funds. | |
• Vanguard Target Retirement Funds | |
Choose a single, all-in-one portfolio that is professionally managed and well diversified. It automatically shifts from a more aggressive to a more conservative asset allocation as your target retirement date approaches, so you can leave the time-consuming details of portfolio management to Vanguard. | |
• Other investment options | |
Consolidate and build your portfolio in a single account that provides access to the universe of stocks, bonds, options, certificates of deposit (CDs), exchange-traded funds (ETFs), and non-Vanguard mutual funds through Vanguard Brokerage Services®. | |
ROLLOVER OPTIONS | |
When you change jobs or retire, you can take greater control of your investments by rolling over your assets in an employer-sponsored retirement plan to a Vanguard IRA. To initiate a rollover, visit Vanguard.com, where you can complete our easy online application. You can also print out the application and mail it to us—or call a Vanguard retirement specialist at 800-205-6189. | |
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THE PEOPLE WHO GOVERN YOUR FUND
The trustees of your mutual fund are there to see that the fund is operated and managed in your best interests since, as a shareholder, you are a part owner of the fund. Your fund trustees also serve on the board of directors of The Vanguard Group, Inc., which is owned by the Vanguard funds and provides services to them on an at-cost basis. | |
A majority of Vanguard’s board members are independent, meaning that they have no affiliation with Vanguard or the funds they oversee, apart from the sizable personal investments they have made as private individuals. Our independent board members bring distinguished backgrounds in business, academia, and public service to their task of working with Vanguard officers to establish the policies and oversee the activities of the funds. | |
Among board members’ responsibilities are selecting investment advisors for the funds; monitoring fund operations, performance, and costs; reviewing contracts; nominating and selecting new trustees/directors; and electing Vanguard officers. | |
Name (Year of Birth) Trustee/Officer Since | Position(s) Held with Fund (Number of Vanguard Funds Overseen by Trustee/Officer) | Principal Occupation(s) During the Past Five Years |
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John J. Brennan* (1954) May 1987 | Chairman of the Board, Chief Executive Officer, and Trustee (132) | Chairman of the Board,Chief Executive Officer, and Director/Trustee of The Vanguard Group, Inc., and of each of the investment companies served by The Vanguard Group. |
INDEPENDENT TRUSTEES | ||
Charles D. Ellis (1937) January 2001 | Trustee (132) | The Partners of `63 (pro bono ventures in education); Senior Advisor to Greenwich Associates (international business strategy consulting); Successor Trustee of Yale University; Overseer of the Stern School of Business at New York University; Trustee of the Whitehead Institute for Biomedical Research. |
Rajiv L. Gupta (1945) December 2001** | Trustee (132) | Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Board Member of the American Chemistry Council; Trustee of Drexel University and of the Chemical Heritage Foundation. |
JoAnn Heffernan Heisen (1950) July 1998 | Trustee (132) | Vice President, Chief Information Officer, and Member of the Executive Committee of Johnson & Johnson (pharmaceuticals/ consumer products); Director of the University Medical Center at Princeton and Women's Research and Education Institute. |
Burton G. Malkiel (1932) May 1977 | Trustee (129) | Chemical Bank Chairman’s Professor of Economics, Princeton University; Director of Vanguard Investment Series plc (Irish investment fund) (since November 2001), Vanguard Group (Ireland) Limited (investment management) (since November 2001), BKF Capital (investment management), The Jeffrey Co. (holding company), and NeuVis, Inc. (software company). |
André F. Perold (1952) December 2004 | Trustee (132) | George Gund Professor of Finance and Banking, Harvard Business School (since 2000); Senior Associate Dean, Director of Faculty Recruiting, and Chair of Finance Faculty, Harvard Business School; Director and Chairman of UNX, Inc. (equities trading firm) (since 2003); Director of registered investment companies advised by Merrill Lynch Investment Managers and affiliates (1985–2004), Genbel Securities Limited (South African financial services firm) (1999–2003), Gensec Bank (1999–2003), Sanlam Investment Management (1999–2001), Sanlam, Ltd. (South African insurance company) (2001–2003), Stockback, Inc. (credit card firm) (2000–2002), and Bulldogresearch.com (investment research) (1999–2001); and Trustee of Commonfund (investment management) (1989–2001). |
Alfred M. Rankin, Jr. (1941) January 1993 | Trustee (132) | Chairman, President, Chief Executive Officer, and Director of NACCO Industries, Inc. (forklift trucks/housewares/lignite); Director of Goodrich Corporation (industrial products/aircraft systems and services); Director of Standard Products Company (supplier for the automotive industry) until 1998. |
J. Lawrence Wilson (1936) April 1985 | Trustee (132) | Retired Chairman and Chief Executive Officer of Rohm and Haas Co. (chemicals); Director of Cummins Inc. (diesel engines), MeadWestvaco Corp. (paper products), and AmerisourceBergen Corp. (pharmaceutical distribution); Trustee of Vanderbilt University. |
EXECUTIVE OFFICERS* | ||
R. Gregory Barton (1951) June 2001 | Secretary (132) | Managing Director and General Counsel of The Vanguard Group, Inc.; Secretary of The Vanguard Group, Inc. and of each of the investment companies served by The Vanguard Group since June 2001. |
Thomas J. Higgins (1957) July 1998 | Treasurer (132) | Principal of The Vanguard Group, Inc.; Treasurer of each of the investment companies served by The Vanguard Group. |
*Officers of the funds are “interested persons” as defined in the Investment Company Act of 1940. | ||
**December 2002 for Vanguard Equity Income Fund, Vanguard Growth Equity Fund, the Vanguard Municipal Bond Funds, and the Vanguard State Tax-Exempt Funds. | ||
More information about the trustees is in the Statement of Additional Information, available from The Vanguard Group. |
VANGUARD SENIOR MANAGEMENT TEAM | |
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Mortimer J. Buckley, Information Technology. James H. Gately, Investment Programs and Services. Kathleen C. Gubanich, Human Resources. F. William McNabb, III, Client Relationship Group. | Michael S. Miller, Planning and Development. Ralph K. Packard, Finance. George U. Sauter, Chief Investment Officer. |
John C. Bogle, Founder; Chairman and Chief Executive Officer, 1974-1996. | |
![]() Post Office Box 2600 Valley Forge, PA 19482-2600 | |
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Vanguard, The Vanguard Group, Vanguard.com, Admiral, VIPER,* VIPERs, * Vanguard IRA, PlainTalk ,and the ship logo are trademarks of The Vanguard Group, Inc. | World Wide Web www.vanguard.com |
The funds or securities referred to herein that are offered by The anguard Group and track an MSCI index are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities. For such funds or securities, the prospectus or the Statement of Additional Information contains a more detailed description of the limited relationship MSCI has with The Vanguard Group. | |
All other marks are the exclusive property of their respective owners. | |
All comparative mutual fund data are from Lipper Inc. or Morningstar, Inc., unless otherwise noted. *Patent pending. | Fund Information 800-662-7447 |
For More Information This report is intended for the funds' shareholders. It may not be distributed to prospective investors unless it is preceded or accompanied by the current fund prospectus. To receive a free copy of the prospectus or the Statement of Additional Information, or to request additional information about the funds or other Vanguard funds, please contact us at one of the adjacent telephone numbers or by e-mail through Vanguard.com. Prospectuses may also be viewed online. | Direct Investor Account Services 800-662-2739 |
You can obtain a free copy of Vanguard's proxy voting guidelines by visiting our website, www.vanguard.com, and searching for "proxy voting guidelines," or by calling Vanguard at 800-662-2739. They are also available from the SEC's website, www.sec.gov. In addition, you may obtain a free report on how your fund voted the proxies for securities it owned during the 12 months ended June 30. To get the report, visit either www.vanguard.com or www.sec.gov. | Institutional Investor Services 800-523-1036 |
You can review and copy information about your fund at the SEC's Public Reference Room in Washington, D.C. To find out more about this public service, call the SEC at 202-942- 8090. Information about your fund is also available on the SEC's website, and you can receive copies of this information, for a fee, by sending a request in either of two ways: via e-mail addressed to publicinfo@sec.gov or via regular mail addressed to the Public Reference Section, Securities and Exchange Commission, Washington, DC 20549-0102. | Text Telephone 800-952-3335 |
© 2005 The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor. | |
Q4832 042005 |
Item 2: Not Applicable
Item 3: Not Applicable
Item 4: Not Applicable
Item 5: Not applicable.
Item 6: Not applicable.
Item 7: Not applicable.
Item 8: Not applicable.
Item 9: Not applicable.
Item 10: 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 Registrant’s Internal Control Over Financial Reporting or in other factors that could significantly affect this control subsequent to the date of the evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
Item 12: Exhibits.
Certifications.
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 WORLD FUNDS | |
BY: | (signature) |
(HEIDI STAM) JOHN J. BRENNAN* CHIEF EXECUTIVE OFFICER |
Date: | April 15, 2005 |
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 WORLD FUNDS | |
BY: | (signature) |
(HEIDI STAM) JOHN J. BRENNAN* CHIEF EXECUTIVE OFFICER |
Date: | April 15, 2005 |
VANGUARD WORLD FUNDS | |
BY: | (signature) |
(HEIDI STAM) THOMAS J. HIGGINS* TREASURER |
Date: | April 15, 2005 |
*By Power of Attorney. See File Number 002-14336, filed on December 20, 2004. Incorporated by Reference.