March 1, 2016 | ||
Asen Parachkevov, Esq. | ||
U.S. Securities and Exchange Commission | via electronic filing | |
100 F Street, N.E. | ||
Washington, DC 20549 | ||
Re: | Vanguard Tax-Managed Funds (the “Trust”) | |
File No. 33-53683 | ||
Post-Effective Amendment Number 57 |
Dear Mr. Parachkevov,
This letter responds to your comments provided on February 5, 2016, on the above referenced post-effective amendment. The comments apply to Vanguard Developed Markets Index Fund.
Comment 1: | Prospectus – Principal Investment Strategies |
Comment: | In this section, there is a discussion of index sampling that includes the key |
characteristics of the securities used to approximate the Index. Please confirm if this is | |
an exhaustive list of the key characteristics used and, if not, please provide a discussion | |
of all the characteristics used to approximate the Index. | |
Response: | We confirm that the list is inclusive of all principal investment strategies used to sample |
the Index and therefore this disclosure is responsive to Item 4(a) of Form N1-A. | |
Comment 2: | Prospectus – Principal Risks |
Comment: | Since the FTSE Developed All Cap ex US Transition Index includes mid- and small-cap |
stocks, their risks should be disclosed as a principal risk. | |
Response: | We will add the requested disclosure. |
Asen Parachkevov, Esq.
March 1, 2016
Page 2
Comment 3: | Prospectus – Average Annual Total Returns Table |
Comment: | In the next filing, please include the return information for the FTSE Developed All Cap |
ex US Transition Index. Also, pursuant to Item 4 of Form N-1A, please consider | |
including information about the spliced index in the narrative explanation accompanying | |
the bar chart and table for the fund. | |
Response: | In the upcoming 485(B) filing that will take place on April 7, 2016, for effectiveness on |
April 8, 2016, the Average Annual Total Return Table will include return information for | |
the Transition Index and Spliced Index as of December 31, 2015. Additionally, we will | |
include the description of the spliced index as responsive to Item 4, Instruction 2(b) in the | |
subsequent post-effective amendment. | |
Comment 4: | Prospectus – More on the Fund |
Comment: | The 80% policy states that “the Fund will invest at least 80% of its assets in the stocks |
that make up its target index.” Please confirm why the 80% policy does not state that the | |
Fund will invest at least 80% of its assets in the types of stocks suggested by its name. | |
Response: | We have reviewed our disclosure and determined that we comply with Rule 35d-1 by |
disclosing a policy of investing at least 80% of an index fund’s assets in the securities | |
that make up its target index. As discussed in the response to comment 5, even though | |
the Fund seeks to employ an index sampling strategy, it still invests in the index | |
constituents. | |
Comment 5: | Prospectus—More on the Fund |
Comment: | In the “Market Exposure” section, it states that “The Fund invests all, substantially all, or |
a representative sample of its assets in the stocks included in the FTSE Developed All | |
Cap ex US Transition Index.” Please confirm that this language is consistent with the | |
Fund’s policy of investing at least 80% of its assets in the stocks that make up its target | |
index. | |
Response: | We confirm this is consistent with the Fund’s policy and the Market Exposure section is |
intended to provide a description of how the Fund invests among its index constituents. | |
Comment 6: | Statement of Additional Information – Description of Compensation |
Comment: | In the “Description of Compensation section, please disclose the benchmark that will be |
used to determine bonus payments. | |
Response: | We will incorporate this change and update the benchmark to reflect that the Fund is |
currently tracking the Transition Index. |
Asen Parachkevov, Esq.
March 1, 2016
Page 3
Comment 7: Tandy Requirements
As required by the SEC, each Fund acknowledges that:
- The Fund is responsible for the adequacy and accuracy of the disclosure in the filing.
- Staff comments or changes in response to staff comments in the filings reviewed bythe staff do not foreclose the Commission from taking any action with respect to thefiling.
- The Fund may not assert staff comments as a defense in any proceeding initiated by theCommission or any person under the federal securities laws of the United States.
Please contact me at (610) 669-8439 with any questions or comments regarding the above response. Thank you.
Sincerely,
Christyn L. Rossman
Associate Counsel
The Vanguard Group, Inc.