UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT
OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-5972
Name of Registrant: Vanguard International Equity Index 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: October 31
Date of reporting period: November 1, 2003 - April 30, 2004
Item 1: Reports to Shareholders
VANGUARD(R) INTERNATIONAL
STOCK INDEX FUNDS
APRIL 30, 2004
{GRAPHIC}
SEMIANNUAL REPORT
VANGUARD(R) EUROPEAN STOCK INDEX FUND
VANGUARD(R) PACIFIC STOCK INDEX FUND
VANGUARD(R) EMERGING MARKETS STOCK INDEX FUND
VANGUARD(R) TOTAL INTERNATIONAL STOCK INDEX FUND
VANGUARD(R) DEVELOPED MARKETS INDEX FUND
VANGUARD(R) INSTITUTIONAL DEVELOPED MARKETS INDEX FUND
THE VANGUARD GROUP(R) [LOGO]
HOW TO READ YOUR FUND REPORT
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This report contains information that can help you evaluate your investment. It
includes details about your fund's return and presents data and analysis that
provide insight into the fund's performance and investment approach.
By reading the letter from Vanguard's chairman, you'll get an understanding of
how the fund invests and how the market environment affected its performance.
The statistical information that follows can help you understand how the fund's
performance and characteristics stack up against those of similar funds and
market benchmarks.
It's important to keep in mind that the opinions expressed here are just that:
informed opinions. They should not be considered promises or advice. These
opinions, like the statistics, cover the period through the date on the cover of
this report. The risks of investing in the fund are spelled out in the
prospectus.
Frequent updates on the fund's performance and information about some of its
holdings are available on Vanguard.com(R).
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CONTENTS
1 LETTER FROM THE CHAIRMAN
6 FUND PROFILES
14 GLOSSARY OF INVESTMENT TERMS
15 PERFORMANCE SUMMARIES
19 ABOUT YOUR FUND'S EXPENSES
21 FINANCIAL STATEMENTS
71 ADVANTAGES OF VANGUARD.COM
SUMMARY
- - The Vanguard International Stock Index Funds posted gains ranging from 8.2%
to 12.9% during the six months ended April 30, 2004.
- - Gains were broad-based across countries and industry sectors. Japan and the
United Kingdom were significant contributors because of their heavy
weightings in the relevant indexes.
- - In contrast to the last fiscal year, currency fluctuations played only a
minor role, adding a few percentage points to European returns for
U.S.-based investors, but having virtually no impact elsewhere.
WANT LESS CLUTTER IN YOUR MAILBOX? JUST REGISTER WITH VANGUARD.COM
AND OPT TO GET FUND REPORTS ONLINE.
EMERGING MARKETS STOCK INDEX FUND
EUROPEAN STOCK INDEX FUND
PACIFIC STOCK INDEX FUND
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LETTER FROM THE CHAIRMAN
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Dear Shareholder,
The global stock rally that started in early 2003 continued through most of the
recent fiscal half-year. During the six months ended April 30, 2004, the
Vanguard International Stock Index Funds posted returns ranging from 8.2% for
the Investor Shares of the Emerging Markets Stock Index Fund to 12.9% for both
the Admiral and Institutional Shares of the European Stock Index Fund. Four of
the six funds matched or outpaced the average results of their respective mutual
fund peer groups.
[PICTURES OF JOHN J. BRENNAN]
The table on page 2 presents total returns (capital change plus reinvested
distributions) for each fund's share classes, as well as for the funds' target
indexes and average peers. Information on changes in the funds' net asset values
and on each fund's per-share distributions can be found on page 5.
STOCKS ROSE EARLY ON, THEN GAVE UP SOME OF THEIR GAINS
For most of the fiscal half-year, global stock markets rose. But in March and
April, the markets gave back some of their gains as higher oil prices and
reports of robust economic growth provoked fears of inflation and higher
interest rates. In addition, Europe in particular felt the repercussions of the
March 11 terrorist train bombings in Madrid, which caused stock prices to
plummet before recovering somewhat. Nevertheless, the Morgan Stanley Capital
International (MSCI) Europe Index posted a stellar six-month return of 9.2% in
local currencies. A weaker U.S. dollar relative to the euro and other European
currencies augmented returns for U.S.-based investors--the index returned 12.9%
in dollars, the best result among the major global regions.
1
Currency fluctuations largely canceled themselves out in the Pacific Rim and
emerging markets, having little impact on returns that were generally solid.
Japan--Asia's largest stock market, which earned 13.3% in yen and 12.9% in
dollars--benefited from China's booming economy and insatiable demand for
industrial machinery, construction supplies, electronic components, and
higher-end consumer goods, made both in Japan itself and in Japanese factories
in China.
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TOTAL RETURNS SIX MONTHS ENDED
APRIL 30, 2004
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VANGUARD EUROPEAN STOCK INDEX FUND
Investor Shares 12.8%
Admiral Shares 12.9
Institutional Shares 12.9
MSCI Europe Index 12.9
Average European Region Fund* 12.8
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VANGUARD PACIFIC STOCK INDEX FUND
Investor Shares 9.8%
Admiral Shares 9.8
Institutional Shares 9.9
MSCI Pacific Index 11.3
Average Japan/Pacific Region Fund* 11.0
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VANGUARD EMERGING MARKETS STOCK
INDEX FUND
Investor Shares 8.2%
Institutional Shares 8.3
Select Emerging Markets Index** 8.6
Average Emerging Markets Fund* 9.9
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VANGUARD TOTAL INTERNATIONAL STOCK
INDEX FUND 11.6%
Total International Composite Index+ 12.0
Average International Fund* 10.5
- --------------------------------------------------------------------------------
VANGUARD DEVELOPED MARKETS
INDEX FUND 11.9%
MSCI EAFE Index 12.4
Average International Fund* 10.5
VANGUARD INSTITUTIONAL DEVELOPED
MARKETS INDEX FUND 12.1%
MSCI EAFE Index 12.4
Average International Fund* 10.5
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* Derived from data provided by Lipper Inc.
** Consists of stocks in 18 emerging markets of Europe, Asia, Africa, and
Latin America. The index is administered exclusively for Vanguard by MSCI.
+ Consists of the MSCI Europe Index (61%), the MSCI Pacific Index (28%), and
the Selected Emerging Markets Index (11%) as of April 30, 2004
Meanwhile, the U.S. stock market, as measured by the Dow Jones Wilshire 5000
Composite Index, returned 6.4%--a solid result, though modest compared with
returns from overseas. In both domestic and foreign markets, value-oriented
stocks (those that generally trade at below-market valuations relative to their
book values and other fundamental measures) posted better results than growth
stocks (those expected to produce above-average earnings growth).
BOND YIELDS ROSE ON NEWS OF THE STRENGTHENING ECONOMY
In the domestic fixed income markets, interest rates remained low through much
of the period but rose sharply in April, propelled by the strength of the
economy. For the six months, the yield of the benchmark 10-year U.S. Treasury
note increased 22 basis points, from 4.29% to 4.51%. (Indicative of April's
2
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ADMIRAL(TM) SHARES
A LOWER-COST CLASS OF SHARES AVAILABLE TO MANY LONGTIME SHAREHOLDERS AND TO
THOSE WITH SIGNIFICANT INVESTMENTS IN THE FUND.
INSTITUTIONAL SHARES
THIS CLASS OF SHARES ALSO CARRIES LOW EXPENSES AND IS AVAILABLE FOR A MINIMUM
INVESTMENT OF $10 MILLION.
- --------------------------------------------------------------------------------
strong increase, the benchmark note's yield climbed 67 basis points during the
month, from 3.84% to 4.51%.) Returns of corporate bonds outpaced those of
government bonds with similar maturities. High-yield corporate bonds continued
their strong showing as the Lehman Brothers High Yield Bond Index, a benchmark
of below-investment-grade bonds, posted a six-month return of 5.5%. Meanwhile,
the Lehman Aggregate Bond Index, a measure of the taxable investment-grade bond
market, returned 1.2%.
Short-term interest rates remained low and didn't vary much during the period,
staying within a tight range of 0.87% to 0.99%. The yield of the 3-month
Treasury bill, a proxy for money market rates, was 0.96% on April 30, just 1
basis point higher than its initial 0.95% yield.
BROAD-BASED GAINS LED TO SOLID RESULTS FOR OUR FUNDS
With few exceptions, gains overseas were broad-based across countries and
industry sectors. While Japan and the United Kingdom did not post the highest
returns for their respective regions, they contributed the most to aggregate
results because of their heavy weightings in the Pacific, Europe, and EAFE
(Europe, Australasia, Far East) Indexes.
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MARKET BAROMETER TOTAL RETURNS
PERIODS ENDED APRIL 30, 2004
----------------------------
SIX ONE FIVE
MONTHS YEAR YEARS*
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MSCI All Country World Index
ex USA (International) 11.7% 41.3% 0.4%
Russell 1000 Index (Large-caps) 6.1 23.9 -1.7
STOCKS Russell 2000 Index (Small-caps) 6.5 42.0 6.7
Dow Jones Wilshire 5000 Index 6.4 26.1 -1.2
(Entire market)
- --------------------------------------------------------------------------------
Lehman Aggregate Bond Index 1.2% 1.8% 6.7%
(Broad taxable market)
BONDS Lehman Municipal Bond Index 1.2 2.7 5.4
Citigroup 3-Month Treasury Bill Index 0.5 1.0 3.3
- --------------------------------------------------------------------------------
CPI Consumer Price Index 1.6% 2.3% 2.5%
- --------------------------------------------------------------------------------
*Annualized.
Our funds fulfilled their objective of closely tracking their benchmarks during
the fiscal six months. You'll note that the PACIFIC STOCK INDEX FUND, whose
Investor and Admiral Shares returned 9.8% (9.9%
3
for Institutional Shares), fell 1.5 percentage points short of the target index
at the end of the six-month period, largely because of fair-value pricing.
International funds sometimes use fair-value pricing, which determines net asset
value based on real-time developments not reflected in closing market prices
overseas. This practice can seemingly skew returns in relation to an index if
the reporting period's start or end date falls on a day when fair-value pricing
was used, which was the case for the Pacific Stock Index Fund. This reporting
issue does not signal long-term divergence from the index, as the discrepancy
corrects itself when market prices reflect fair value, usually the next day.
Because three of our other funds--the TOTAL INTERNATIONAL STOCK INDEX FUND, the
DEVELOPED MARKETS INDEX FUND, and the INSTITUTIONAL DEVELOPED MARKETS INDEX
FUND--are "funds of funds" that include the Pacific Stock Index Fund among their
holdings, their returns also lagged those of their respective indexes on the
reporting date, though to a much lesser degree.
The EUROPEAN STOCK INDEX FUND closely matched its benchmark--not an easy task,
as indexes do not incur the real-world operating costs that mutual funds must
bear. The EMERGING MARKETS STOCK INDEX FUND lagged its index roughly by its cost
margin.
All six funds have logged admirable long-term records of closely tracking their
target indexes and, on occasion, slightly outpacing them. Much of the credit
goes to the investment advisor, Vanguard's Quantitative Equity Group, which
manages all of Vanguard's equity index funds. The group's asset-management
skills take maximum advantage of Vanguard's low costs, which historically have
given us a leg up over competitors.
BALANCE AND DIVERSIFICATION ARE STILL THE KEY TO LONG-TERM SUCCESS
Through much of the 1990s, when domestic stocks were on a tear, it was difficult
to convince some investors to invest in either bonds or international stocks.
The last few years, however, have shown the enduring value of diversification.
Bonds excelled while stocks tumbled during the bear market, and international
equities easily outpaced U.S. stocks during the recent rally. Lest investors
forget that lesson, we continue to recommend a disciplined investment strategy
of allocating your portfolio among different asset classes in proportions suited
to your objectives, time horizon, and risk tolerance. Staying faithful to such a
plan--rather than listening
4
to the "noise" of short-term market fluctuations and media hype--gives you the
greatest chance of reaching your long-term financial goals.
Thank you for entrusting your hard-earned dollars to Vanguard.
Sincerely,
/s/John J. Brennan
JOHN J. BRENNAN
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
MAY 14, 2004
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YOUR FUND'S PERFORMANCE AT A GLANCE OCTOBER 31, 2003-APRIL 30, 2004
DISTRIBUTIONS PER SHARE
--------------------
STARTING ENDING INCOME CAPITAL
INDEX FUND SHARE PRICE SHARE PRICE DIVIDENDS GAINS
- --------------------------------------------------------------------------------
European Stock
Investor Shares $19.93 $22.00 $0.460 $0.000
Admiral Shares 46.82 51.67 1.118 0.000
Institutional Shares 19.96 22.02 0.490 0.000
- --------------------------------------------------------------------------------
Pacific Stock
Investor Shares $ 7.80 $ 8.45 $0.105 $0.000
Admiral Shares 51.05 55.26 0.733 0.000
Institutional Shares 7.81 8.45 0.118 0.000
- --------------------------------------------------------------------------------
Emerging Markets Stock
Investor Shares $11.04 $11.77 $0.172 $0.000
Institutional Shares $11.05 11.78 0.186 0.000
- --------------------------------------------------------------------------------
Total International Stock $ 9.84 $10.78 $0.190 $0.000
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Developed Markets $ 7.22 $ 7.93 $0.143 $0.000
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Institutional Developed Markets $ 7.16 $ 7.86 $0.158 $0.000
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5
FUND PROFILES AS OF 4/30/2004
These Profiles provide snapshots of each fund's characteristics, compared where
indicated with both an appropriate market index and a broad market index. Key
terms are defined on page 14.
EUROPEAN STOCK INDEX FUND
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PORTFOLIO CHARACTERISTICS
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Number of Stocks 556 538 1,752
Turnover Rate 4%+ -- --
Expense Ratio -- --
Investor Shares 0.29%+
Admiral Shares 0.19%+
Institutional Shares 0.12%+
Short-Term Reserves 0% -- --
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- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX* FUND INDEX**
- --------------------------------------------------------------------------------
R-Squared 1.00 1.00 0.91 1.00
Beta 1.00 1.00 1.10 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COUNTRY DIVERSIFICATION (% of portfolio)
COMPARATIVE
FUND INDEX*
- --------------------------------------------------------------------------------
United Kingdom 36% 36%
France 13 14
Switzerland 11 10
Germany 10 10
Netherlands 7 7
Italy 6 6
Spain 5 5
Sweden 3 3
Finland 2 2
Belgium 2 2
Ireland 1 1
Denmark 1 1
Norway 1 1
Greece 1 1
Portugal 1 1
- --------------------------------------------------------------------------------
Total 100% 100%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS (% of total net assets)
BP PLC 3.7%
(oil)
Vodafone Group PLC 3.2
(cellular telecommunications)
HSBC Holdings PLC 3.0
(banking)
GlaxoSmithKline PLC 2.4
(pharmaceuticals)
Total SA 2.2
(integrated oil)
Novartis AG (Registered) 2.0
(pharmaceuticals)
Nestle SA (Registered) 2.0
(food, beverage, and tobacco)
Royal Dutch Petroleum Co. 1.9
(energy)
Royal Bank of Scotland Group PLC 1.6
(banking)
UBS AG 1.6
(banking)
- --------------------------------------------------------------------------------
Top Ten 23.6%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and
equity index products.
*MSCI Europe Index.
**MSCI All Country World Index ex USA.
+Annualized.
6
- --------------------------------------------------------------------------------
SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Consumer Discretionary 10% 10% 12%
Consumer Staples 10 10 8
Energy 12 12 9
Financials 27 27 26
Health Care 11 11 8
Industrials 7 7 9
Information Technology 4 4 8
Materials 5 5 8
Telecommunication Services 9 9 8
Utilities 5 5 4
- --------------------------------------------------------------------------------
*MSCI Europe Index.
**MSCI All Country World Index ex USA.
VISIT OUR WEBSITE AT VANGUARD.COM FOR REGULARLY UPDATED FUND INFORMATION.
7
FUND PROFILES (CONTINUED)
PACIFIC STOCK INDEX FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Number of Stocks 469 465 1,752
Turnover Rate 1%+ -- --
Expense Ratio -- --
Investor Shares 0.35%+
Admiral Shares 0.26%+
Institutional Shares 0.17%+
Short-Term Reserves 0% -- --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX* FUND INDEX**
- --------------------------------------------------------------------------------
R-Squared 0.98++ 1.00 0.54 1.00
Beta 1.00 1.00 0.76 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COUNTRY DIVERSIFICATION (% of portfolio)
COMPARATIVE
FUND INDEX*
- --------------------------------------------------------------------------------
Japan 74% 75%
Australia 17 16
Hong Kong 5 5
Singapore 3 3
New Zealand 1 1
- --------------------------------------------------------------------------------
Total 100% 100%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Consumer Discretionary 19% 19% 12%
Consumer Staples 6 6 8
Energy 1 1 9
Financials 25 25 26
Health Care 4 4 8
Industrials 14 14 9
Information Technology 13 13 8
Materials 9 9 8
Telecommunication Services 4 4 8
Utilities 5 5 4
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS (% of total net assets)
Toyota Motor Corp. 4.3%
(automotive and transport equipment)
Canon, Inc. 1.9
(computer hardware)
Mitsubishi Tokyo Financial Group Inc. 1.6
(banking)
NTT DoCoMo, Inc. 1.5
(telecommunications)
Takeda Chemical Industries Ltd. 1.5
(pharmaceuticals)
Sony Corp. 1.5
(consumer electronics)
National Australia Bank Ltd. 1.4
(banking)
Honda Motor Co., Ltd. 1.4
(automotive and transport equipment)
BHP Billiton Ltd. 1.4
(metals and mining)
Matsushita Electric Industrial Co., Ltd. 1.3
(consumer products manufacturers)
- --------------------------------------------------------------------------------
Top Ten 17.8%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and equity index
products.
*MSCI Pacific Index.
**MSCI All Country World Index ex USA.
+Annualized.
++Figure is below 1.00 because fair-value pricing was employed during the
period.
8
EMERGING MARKETS
STOCK INDEX FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Number of Stocks 563 539 1,752
Turnover Rate 8%+ -- --
Expense Ratio -- --
Investor Shares 0.50%+
Institutional Shares 0.33%+
Short-Term Reserves 0% -- --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX* FUND INDEX**
- --------------------------------------------------------------------------------
R-Squared 1.00 1.00 0.78 1.00
Beta 0.99 1.00 1.13 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COUNTRY DIVERSIFICATION (% of portfolio)
COMPARATIVE
FUND INDEX*
- --------------------------------------------------------------------------------
South Korea 20% 20%
South Africa 14 15
Taiwan 14 14
Brazil 9 9
China 8 8
Mexico 7 7
India 7 7
Israel 5 5
Thailand 3 3
Chile 2 2
Indonesia 2 2
Turkey 2 2
Poland 2 1
Hungary 1 1
Czech Republic 1 1
Philippines 1 1
Peru 1 1
Argentina 1 1
- --------------------------------------------------------------------------------
Total 100% 100%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS (% of total net assets)
Samsung Electronics Co., Ltd. 7.4%
(electronics)
Anglo American PLC 3.8
(metals and mining)
Teva Pharmaceutical Industries Ltd. 2.6
(pharmaceuticals)
Petroleo Brasileiro SA 2.4
(energy)
Taiwan Semiconductor
Manufacturing Co., Ltd. 1.9
(electronics)
China Mobile (Hong Kong) Ltd. 1.8
(telecommunications)
America Movil SA de CV 1.7
(telecommunication services)
Telefonos de Mexico SA 1.6
(telecommunications)
Kookmin Bank 1.4
(banking)
Sasol Ltd. 1.2
(chemicals)
- --------------------------------------------------------------------------------
Top Ten 25.8%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and equity index
products.
*Select Emerging Markets Index.
**MSCI All Country World Index ex USA.
+Annualized.
Emerging Markets Stock Index Fund continues on next page.
VISIT OUR WEBSITE AT VANGUARD.COM FOR REGULARLY UPDATED FUND INFORMATION.
9
FUND PROFILES (CONTINUED)
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SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND INDEX* INDEX**
- --------------------------------------------------------------------------------
Consumer Discretionary 7% 8% 12%
Consumer Staples 6 6 8
Energy 9 9 9
Financials 17 17 26
Health Care 4 3 8
Industrials 6 6 9
Information Technology 20 20 8
Materials 16 16 8
Telecommunication Services 12 12 8
Utilities 3 3 4
- --------------------------------------------------------------------------------
*Select Emerging Markets Index.
**MSCI All Country World Index ex USA.
10
TOTAL INTERNATIONAL STOCK INDEX FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS
FUND
- --------------------------------------------------------------------------------
Expense Ratio 0%
Average Weighted Expense Ratio* 0.33%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX** FUND INDEX+
- --------------------------------------------------------------------------------
R-Squared 1.00 1.00 1.00 1.00
Beta 1.00 1.00 1.01 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ALLOCATION TO UNDERLYING VANGUARD FUNDS
European Stock Index Fund Investor Shares 62.8%
Pacific Stock Index Fund Investor Shares 27.1
Emerging Markets Stock Index Fund 10.1
- --------------------------------------------------------------------------------
Total 100.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND++ INDEX** INDEX+
- --------------------------------------------------------------------------------
Consumer Discretionary 12% 12% 12%
Consumer Staples 8 9 8
Energy 8 8 9
Financials 25 24 26
Health Care 8 8 8
Industrials 9 9 9
Information Technology 9 8 8
Materials 8 8 8
Telecommunication 9 9 8
Services
Utilities 4 5 4
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS++ (% of total net assets)
BP PLC 2.3%
(oil)
Vodafone Group PLC 2.0
(cellular telecommunications)
HSBC Holdings PLC 1.9
(banking)
GlaxoSmithKline PLC 1.5
(pharmaceuticals)
Total SA 1.4
(integrated oil)
Toyota Motor Corp. 1.2
(automotive and transport equipment)
Samsung Electronics Co., Ltd. 0.8
(electronics)
Anglo American PLC 0.4
(metals and mining)
Teva Pharmaceutical Industries Ltd. 0.3
(pharmaceuticals)
Petroleo Brasiliero SA 0.2
(energy)
- --------------------------------------------------------------------------------
Top Ten 12.0%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and equity index
products.
*For underlying funds; annualized.
**Total International Composite Index.
+ MSCI All Country World Index ex USA.
++ Reflects holdings of underlying funds.
VISIT OUR WEBSITE AT VANGUARD.COM FOR REGULARLY UPDATED FUND INFORMATION.
11
FUND PROFILES (CONTINUED)
DEVELOPED MARKETS INDEX FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS
FUND
- --------------------------------------------------------------------------------
Expense Ratio 0%
Average Weighted Expense Ratio* 0.31%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX** FUND INDEX+
R-Squared 1.00 1.00 0.99 1.00
Beta 1.01 1.00 1.00 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ALLOCATION TO UNDERLYING VANGUARD FUNDS
- --------------------------------------------------------------------------------
European Stock Index Fund Investor Shares 69.8%
Pacific Stock Index Fund Investor Shares 30.2
- --------------------------------------------------------------------------------
Total 100.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND++ INDEX** INDEX+
- --------------------------------------------------------------------------------
Consumer Discretionary 13% 13% 12%
Consumer Staples 8 8 8
Energy 8 8 9
Financials 26 26 26
Health Care 9 9 8
Industrials 9 9 9
Information Technology 7 7 8
Materials 7 7 8
Telecommunication Services 8 8 8
Utilities 5 5 4
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS++ (% of total net assets)
BP PLC 2.6%
(oil)
Vodafone Group PLC 2.2
(cellular telecommunications)
HSBC Holdings PLC 2.1
(banking)
GlaxoSmithKline PLC 1.7
(pharmaceuticals)
Total SA 1.5
(integrated oil)
Novartis AG (Registered) 1.4
(pharmaceuticals)
Nestle SA (Registered) 1.4
(food, beverage, and tobacco)
Toyota Motor Corp. 1.3
(automotive and transport equipment)
Canon, Inc. 0.6
(computer hardware)
Mitsubishi Tokyo Financial 0.5
Group Inc.
(banking)
- --------------------------------------------------------------------------------
Top Ten 15.3%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and equity index
products.
*For underlying funds; annualized.
**MSCI EAFE Index.
+MSCI All Country World Index ex USA.
++Reflects holdings of underlying funds.
12
INSTITUTIONAL DEVELOPED MARKETS INDEX FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS
FUND
- --------------------------------------------------------------------------------
Expense Ratio 0%
Average Weighted Expense Ratio* 0.14%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX** FUND INDEX+
- --------------------------------------------------------------------------------
R-Squared 1.00 1.00 0.99 1.00
Beta 1.01 1.00 1.00 1.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ALLOCATION TO UNDERLYING VANGUARD FUNDS
European Stock Index Fund Institutional Shares 69.8%
Pacific Stock Index Fund Institutional Shares 30.2
- --------------------------------------------------------------------------------
Total 100.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECTOR DIVERSIFICATION (% of portfolio)
COMPARATIVE BROAD
FUND++ INDEX** INDEX+
Consumer Discretionary 13% 13% 12%
Consumer Staples 8 8 8
Energy 8 8 9
Financials 26 26 26
Health Care 9 9 8
Industrials 9 9 9
Information Technology 7 7 8
Materials 7 7 8
Telecommunication Services 8 8 8
Utilities 5 5 4
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TEN LARGEST HOLDINGS++ (% of total net assets)
BP PLC 2.6%
(oil)
Vodafone Group PLC 2.2
(cellular telecommunications)
HSBC Holdings PLC 2.1
(banking)
GlaxoSmithKline PLC 1.7
(pharmaceuticals)
Total SA 1.5
(integrated oil)
Novartis AG (Registered) 1.4
(pharmaceuticals)
Nestle SA (Registered) 1.4
(food, beverage, and tobacco)
Toyota Motor Corp. 1.3
(automotive and transport equipment)
Canon, Inc. 0.6
(computer hardware)
Mitsubishi Tokyo Financial Group Inc. 0.5
(banking)
- --------------------------------------------------------------------------------
Top Ten 15.3%
- --------------------------------------------------------------------------------
"Ten Largest Holdings" excludes any temporary cash investments and equity index
products.
*For underlying funds; annualized.
**MSCI EAFE Index.
+MSCI All Country World Index ex USA.
++ Reflects holdings of underlying funds.
VISIT OUR WEBSITE AT VANGUARD.COM FOR REGULARLY UPDATED FUND INFORMATION.
13
- --------------------------------------------------------------------------------
GLOSSARY OF INVESTMENT TERMS
- --------------------------------------------------------------------------------
AVERAGE WEIGHTED EXPENSE RATIO. Funds that invest in other Vanguard funds incur
no direct expenses, but do bear proportionate shares of the operating,
administrative, and advisory expenses of the underlying funds. The average
weighted expense ratio is the average of these expense ratios, weighted in
proportion to the amount of the fund invested in each underlying fund.
- --------------------------------------------------------------------------------
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).
- --------------------------------------------------------------------------------
14
- --------------------------------------------------------------------------------
PERFORMANCE SUMMARIES AS OF 4/30/2004
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 THE
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.
- --------------------------------------------------------------------------------
EUROPEAN STOCK INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) OCTOBER 31, 1993-APRIL 30, 2004
EUROPEAN STOCK INDEX FUND
FISCAL YEAR INVESTOR SHARES MSCI EUROPE INDEX
1994 11 11.7
1995 14 13.6
1996 17.6 17.5
1997 26.5 26
1998 23.2 23.1
1999 12.9 12.5
2000 1.5 0.9
2001 -23 -22.8
2002 -13.8 -13.9
2003 24.3 24.2
2004* 12.8 12.9
- --------------------------------------------------------------------------------
*Six months ended April 30, 2004.
Note: See Financial Highlights tables on pages 52 through 54 for dividend and
capital gains information.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 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.
TEN YEARS
ONE FIVE ----------------------
INCEPTION DATE YEAR YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------
European Stock Index Fund*
Investor Shares 6/18/1990 54.09% 0.01% 7.00% 2.23% 9.23%
Admiral Shares 8/13/2001 54.21 4.32** -- -- --
Institutional Shares 5/15/2000 54.34 -2.90** -- -- --
- --------------------------------------------------------------------------------
*Total return figures do not reflect the $10 annual account maintenance fee
applied on balances under $10,000 or the 2% fee on redemptions of shares
purchased on or after June 27, 2003, and held for less than two months.
**Returns are since inception.
15
PERFORMANCE SUMMARIES (CONTINUED)
PACIFIC STOCK INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) OCTOBER 31, 1993-APRIL 30, 2004
PACIFIC STOCK INDEX FUND
FISCAL YEAR INVESTOR SHARES MSCI PACIFIC INDEX
1994 8.7 9
1995 -11 -11
1996 4 3.4
1997 -19.7 -19.8
1998 -14 -13.9
1999 51.3 50.8
2000 -10.5 -10.5
2001 -29.7 -29.7
2002 -12.7 -11.5
2003 33.8 33.8
2004* 9.8 11.3
- --------------------------------------------------------------------------------
*Six months ended April 30, 2004.
Note: See Financial Highlights tables on pages 55 through 57 for dividend and
capital gains information.
EMERGING MARKETS STOCK INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) MAY 4, 1994-APRIL 30, 2004
EMERGING MARKETS STOCK SELECT EMERGING
INDEX FUND INVESTOR MARKETS
FISCAL YEAR SHARES INDEX
- --------------------------------------------------------------------------------
1994 26.7 20.3
1995 -16.6 -17.1
1996 16.3 14.9
1997 -13.4 -13
1998 -20.6 -20.9
1999 34.7 33.9
2000 -6.3 -6.4
2001 -21.2 -21
2002 5.3 5.8
2003 49.9 50.6
2004** 8.2 8.6
- --------------------------------------------------------------------------------
*Consists of stocks in 18 emerging markets in Europe, Asia, Africa, and Latin
America. Through April 30, 2003, this index included a cash component (5%) based
on the Lipper Money Market Average. The index is administered exclusively for
Vanguard by MSCI.
**Six months ended April 30, 2004.
Note: See Financial Highlights tables on pages 58 and 59 for dividend and
capital gains information.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 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.
TEN YEARS
ONE FIVE -----------------------
INCEPTION DATE YEAR YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------
Pacfic Stock Index Fund*
Investor Shares 6/18/1990 65.28% 1.84% -1.81% 0.97% -0.84%
Admiral Shares 8/13/2001 65.60 7.95** -- -- --
Institutional Shares 5/15/2000 65.74 -3.90** -- -- --
- --------------------------------------------------------------------------------
Emerging Markets Stock Index Fund*
Investor Shares 5/4/1994 80.18% 10.04% 2.54%** 2.04%** 4.58%**
Fee-Adjusted Returns+ 78.40 9.83 2.54** 1.94** 4.48**
Institutional Shares 6/22/2000 80.28 6.02** -- -- --
Fee-Adjusted Returns+ 78.50 5.75** -- -- --
- --------------------------------------------------------------------------------
*Total return figures do not reflect the $10 annual account maintenance fee
applied on balances under $10,000 or the 2% fee on redemptions of shares
purchased on or after June 27, 2003, and held for less than two months.
**Return since inception.
+Performance figures are adjusted for the 0.5% transaction fee on purchases and
redemptions.
16
TOTAL INTERNATIONAL STOCK INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) APRIL 29, 1996-APRIL 30, 2004
TOTAL INTERNATIONAL TOTAL INTERNATIONAL
FISCAL YEAR STOCK INDEX FUND COMPOSITE INDEX*
1996 -2 -2.5
1997 2.1 2
1998 6 5.9
1999 24.1 23.6
2000 -3.1 -3.4
2001 -24.7 -24.5
2002 -11.8 -11.7
2003 28.9 29.1
2004** 11.6 12
- --------------------------------------------------------------------------------
*Consists of the MSCI Europe index (61%), the MSCI Pacific Index (28%), and the
Select Emerging Markets Index (11%) as of April 30, 2004.
**Six months ended April 30, 2004.
Note: See Financial Highlights table on page 60 for dividend and capital gains
information.
DEVELOPED MARKETS INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) MAY 8, 2000-APRIL 30, 2004
FISCAL YEAR DEVELOPED MARKETS INDEX MSCI EAFE INDEX
2000 -7.3 -7.9
2001 -25.1 -24.9
2002 -13.6 -13.2
2003 27.1 27
2004* 11.9 12.4
- --------------------------------------------------------------------------------
*Six months ended April 30, 2004.
Note: See Financial Highlights table on page 61 for dividend and capital gains
information.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 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
ONE FIVE -----------------------
INCEPTION DATE YEAR YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------
Total International Stock
Index Fund* 4/29/1996 59.40% 1.35% 1.15% 1.80% 2.95%
- --------------------------------------------------------------------------------
Developed Markets Index Fund* 5/8/2000 57.54% -3.33%** -- -- --
- --------------------------------------------------------------------------------
*Total return figures do not reflect the $10 annual account maintenance fee
applied on balances under $10,000 or the 2% fee on redemptions of shares
purchased on or after June 27, 2003, and held for less than two months.
**Return since inception.
17
PERFORMANCE SUMMARIES (CONTINUED)
INSTITUTIONAL DEVELOPED MARKETS INDEX FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) JUNE 1, 2000-APRIL 30, 2004
INSTITUATIONAL DEVELOPED
FISCAL YEAR MARKETS INDEX FUND MSCI EAFE INDEX
2000 -8 -7.9
2001 -25.1 -24.9
2002 -13.4 -13.2
2003 27.1 27
2004* 12.1 12.4
- --------------------------------------------------------------------------------
*Six months ended April 30, 2004.
Note: See Financial Highlights table on page 62 for dividend and capital gains
information.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 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
ONE -----------------------
INCEPTION DATE YEAR CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------
Institutional Developed Markets Index
Fund* 6/1/2000 57.82% -5.44% 1.96% -3.48%
- --------------------------------------------------------------------------------
*Total return figures do not reflect the 2% fee on redemptions of shares
purchased on or after June 27, 2003, and held for less than two months.
18
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
Six Months Ended April 30, 2004
BEGINNING ENDING EXPENSES
INTERNATIONAL STOCK ACCOUNT VALUE ACCOUNT VALUE PAID DURING
INDEX FUND 10/31/2003 4/30/2004 PERIOD*
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Vanguard European Stock Index Fund
Investor Shares $1,000 $1,128 $1.49
Admiral Shares 1,000 1,129 0.96
Institutional Shares 1,000 1,129 0.64
- --------------------------------------------------------------------------------
Vanguard Pacific Stock Index Fund
Investor Shares $1,000 $1,098 $1.78
Admiral Shares 1,000 1,098 1.36
Institutional Shares 1,000 1,099 0.84
- --------------------------------------------------------------------------------
Vanguard Emerging Markets Stock Index Fund**
Investor Shares $995 $1,077 $7.59
Institutional Shares 995 1,078 6.66
- --------------------------------------------------------------------------------
Vanguard Total International
Stock Index Fund $1,000 $1,116 $1.69
- --------------------------------------------------------------------------------
Vanguard Developed Markets
Index Fund $1,000 $1,119 $1.59
- --------------------------------------------------------------------------------
Vanguard Institutional
Developed Markets Index $1,000 $1,121 $0.74
- --------------------------------------------------------------------------------
HYPOTHETICAL 5% RETURN
Vanguard European Stock Index Fund
Investor Shares $1,000 $1,049 $1.43
Admiral Shares 1,000 1,049 0.92
Institutional Shares 1,000 1,049 0.61
- --------------------------------------------------------------------------------
Vanguard Pacific Stock Index Fund
Investor Shares $1,000 $1,048 $1.74
Admiral Shares 1,000 1,049 1.33
Institutional Shares 1,000 1,049 0.82
- --------------------------------------------------------------------------------
Vanguard Emerging Markets Stock Index Fund**
Investor Shares $995 $1,042 $7.55
Institutional Shares 995 1,043 6.63
- --------------------------------------------------------------------------------
Vanguard Total International
Stock Index Fund $1,000 $1,048 $1.64
- --------------------------------------------------------------------------------
Vanguard Developed Markets
Index Fund $1,000 $1,049 $1.54
- --------------------------------------------------------------------------------
Vanguard Institutional
Developed Markets Index $1,000 $1,049 $0.72
- --------------------------------------------------------------------------------
*Expenses are equal to the fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by the number of days in the
most recent fiscal half-year, then divided by 366.
**Calculations reflect the fund's 0.5% purchase fee, which is deducted from all
purchases (including exchanges from other Vanguard funds) but not from
reinvested dividends and capital gains.
A typical fund's expenses are expressed as a percentage of its average net
assets. This figure is known as the expense ratio. Vanguard "funds of funds,"
such as the Developed Markets Index Fund, Institutional Developed Markets Index
Fund, and Total International Stock Index Fund, do not have direct expenses, but
each fund bears its proportionate share of the expenses of the underlying funds
in which it invests. These indirect expenses make up the fund's average weighted
expense ratio, also expressed as a percentage of average net assets.
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
19
shown and held for the entire period. Please note that the expenses shown are
meant to highlight and help you compare ongoing costs only; they do not include
low-balance fees, account maintenance fees, or the transaction fees on
redemptions. These fees are described fully in the prospectus; they also are
noted on the Performance Summary pages in this report. If the fees were applied
to your account, your costs would be higher. The funds do not carry "sales
loads."
The table on the previous page illustrates your fund's costs in two ways:
* 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."
* HYPOTHETICAL 5% 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 return of 5% before expenses during the period shown, 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 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.
- --------------------------------------------------------------------------------
ANNUALIZED EXPENSE RATIOS:
YOUR FUND COMPARED WITH ITS PEER GROUP
AVERAGE
FUND WEIGHTED PEER-GROUP
EXPENSE EXPENSE EXPENSE
RATIO RATIO* RATIO**
- --------------------------------------------------------------------------------
European Stock Index Fund 1.81%
Investor Shares 0.29% --
Admiral Shares 0.19 --
Institutional Shares 0.12 --
- --------------------------------------------------------------------------------
Pacific Stock Index Fund 2.27%
Investor Shares 0.35% --
Admiral Shares 0.26 --
Institutional Shares 0.17 --
- --------------------------------------------------------------------------------
Emerging Markets Stock Index Fund 2.13%
Investor Shares 0.50% --
Institutional Shares 0.33 --
- --------------------------------------------------------------------------------
Total International Stock
Index Fund 0.00% 0.33% 1.76%
- --------------------------------------------------------------------------------
Developed Markets Index Fund 0.00% 0.31% 1.76%
- --------------------------------------------------------------------------------
Institutional Developed
Markets Index Fund 0.00% 0.14% 1.76%
- --------------------------------------------------------------------------------
*For the underlying funds; annualized.
**Peer groups are: for the European Stock Index Fund, the Average European
Region Fund; for the Pacific Stock Index Fund, the Average Japan/Pacific Region
Fund; for the Emerging Markets Stock Index Fund, the Average Emerging Markets
Fund; for the other funds, the Average International Fund. Peer expense ratios
are derived from data provided by Lipper Inc. and capture information through
year-end 2003.
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. For additional
information on operating expenses and other shareholder costs, please refer to
the appropriate fund prospectus.
20
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS (UNAUDITED) AS OF 4/30/2004
- --------------------------------------------------------------------------------
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. European,
Pacific, and Emerging Markets Stock Index Fund securities are grouped and
subtotaled by asset type (common stocks, bonds, etc.) and by country; the Total
International Stock, Developed Markets, and Institutional Developed Markets
Index Funds list investments in shares of each Vanguard International Stock
Index fund. 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 of each fund, 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.
- --------------------------------------------------------------------------------
MARKET
VALUE*
EUROPEAN STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
COMMON STOCKS (99.4%)(1)
- --------------------------------------------------------------------------------
AUSTRIA (0.4%)
Erste Bank der Oesterreichischen
Sparkassen AG 46,794 $ 7,003
* Telekom Austria AG 434,155 6,375
OMV AG 21,285 3,891
* Bank Austria Creditanstalt 56,978 3,234
Wienerberger AG 76,138 2,487
* Immofinanz Immobilien
Anlagen AG 316,156 2,460
Voestalpine AG 34,498 1,502
Oesterreichische
Elektrizitaetswirtschafts
AG Class A 7,206 1,180
Boehler-Uddeholm AG 12,355 1,001
Flughafen Wien AG 16,022 885
Mayr-Melnhof Karton AG 6,350 807
* VA Technologies AG 15,220 764
* RHI AG 27,692 598
--------------
32,187
--------------
BELGIUM (1.6%)
Fortis Group 1,623,326 35,339
Dexia 1,003,429 16,503
Electrabel SA 47,174 $ 15,489
Solvay SA 99,761 8,359
* KBC Bankverzekeringsholding 142,304 7,999
* Belgacom SA 244,701 7,421
Interbrew 237,774 7,143
Groupe Bruxelles Lambert SA 107,685 6,480
Delhaize Group 117,170 5,689
UCB SA 136,325 5,455
Agfa Gevaert NV 147,731 3,358
Colruyt NV 26,929 2,897
* Mobistar SA 34,025 2,203
Umicore 33,596 1,945
Omega Pharma SA 32,856 1,353
Bekaert NV 21,922 1,222
Barco NV 13,832 1,148
Cofinimmo 7,602 1,067
D'Ieteren SA 4,273 856
Compagnie Maritime Belge SA 5,445 516
--------------
132,442
--------------
DENMARK (1.1%)
Novo Nordisk A/S B Shares 400,242 19,020
Danske Bank A/S 777,673 17,476
AP Moller-Maersk A/S 1,728 10,884
21
- --------------------------------------------------------------------------------
MARKET
VALUE*
EUROPEAN STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
TDC A/S 202,495 $ 6,883
Danisco A/S 79,758 3,777
Novozymes A/S 84,634 3,477
ISS A/S 68,843 3,438
* Vestas Wind Systems A/S 222,357 3,313
Group 4 Falck A/S 118,767 2,946
GN Store Nord A/S 344,140 2,672
H. Lundbeck A/S 110,257 2,238
Carlsberg A/S B Shares 44,341 2,189
* Topdanmark A/S 37,103 2,182
Coloplast A/S B Shares 20,447 1,927
* William Demant A/S 41,990 1,505
DSV, De Sammensluttede
Vognmaend A/S 32,120 1,361
Kobenhavns Lufthavne A/S 9,598 1,356
East Asiatic Co. A/S 30,569 1,231
Bang & Olufsen A/S B Shares 17,647 969
* FLS Industries A/S B Shares 40,235 525
NKT Holding A/S 28,010 510
--------------
89,879
--------------
FINLAND (2.0%)
Nokia Oyj 7,517,409 105,795
UPM-Kymmene Oyj 819,675 15,112
Stora Enso Oyj R Shares 963,746 12,997
Fortum Oyj 534,076 5,986
Sampo Oyj A Shares 430,151 4,120
TietoEnator Oyj B Shares 128,929 3,841
Kone Oyj Corp. B Shares 54,505 3,169
* Elisa Oyj Class A 216,350 2,957
Outokumpu Oyj A Shares 135,443 2,065
Metso Oyj 161,337 1,979
Kesko Oyj 93,201 1,715
Amer Group Ltd. 35,981 1,707
Orion-Yhtyma Oyj B Shares 57,199 1,471
Uponor Oyj 45,206 1,382
Wartsila Oyj B Shares 58,640 1,290
Nokian Renkaat Oyj 14,111 1,184
Rautaruuki Oyj 130,015 985
Pohjola Group PLC D Shares 85,983 856
KCI Konecranes Oyj 20,639 755
--------------
169,366
--------------
FRANCE (13.3%)
Total SA 964,842 178,465
* Aventis SA 1,064,985 81,131
BNP Paribas SA 1,273,528 76,485
AXA 2,211,081 46,570
* Societe Generale Class A 514,072 42,829
* France Telecom SA 1,747,976 42,180
Carrefour SA 897,240 41,635
L'Oreal SA 528,224 39,829
Sanofi-Synthelabo SA 574,308 36,488
Groupe Danone 190,461 $ 31,919
* Vivendi Universal SA 1,153,691 29,029
* Alcatel SA 1,913,814 28,517
L'Air Liquide SA (Registered) 156,662 27,437
LVMH Louis Vuitton
Moet Hennessy 384,279 27,087
Credit Agricole SA 1,039,290 25,640
Suez SA 1,260,240 25,259
Cie. de St. Gobain SA 490,996 24,791
Lafarge SA 261,797 21,811
Schneider Electric SA 323,600 21,801
Renault SA 268,370 20,026
PSA Peugeot Citroen 266,145 14,299
Accor SA 295,636 12,446
Lagardere S.C.A. 197,101 11,873
Pinault-Printemps-Redoute SA 105,391 10,878
Bouygues SA 315,123 10,762
Pernod Ricard SA 83,123 10,493
Vinci SA 106,002 10,318
Veolia Environnement 380,190 10,113
Compagnie Generale des
Etablissements Michelin
SA B Shares 213,547 9,994
Arcelor 546,743 9,084
Essilor International SA 152,284 8,910
Thomson SA 370,939 7,159
* Vivendi Universal SA ADR 272,160 6,728
* Cap Gemini SA 176,001 6,228
Unibail Co. 64,262 6,070
Societe Television Francaise 1 185,810 5,740
Etablissements Economiques du
Casino Guichard-Perrachon SA 58,846 5,238
Valeo SA 115,613 4,766
Publicis Groupe SA 153,341 4,595
Thales SA 121,837 4,526
Autoroutes du Sud de la France 108,526 4,219
Sodexho Alliance SA 149,456 4,122
* Technip SA 29,712 4,117
Dassault Systemes SA 88,781 3,625
* Atos Origin SA 57,894 3,356
CNP Assurances 53,673 3,185
Gecina SA 41,806 3,117
Sagem SA 28,418 3,100
* Alstom 1,539,743 2,916
Hermes International 14,253 2,840
Imerys 12,377 2,816
* Business Objects SA 104,299 2,358
Societe BIC SA 50,503 2,192
Klepierre 34,395 2,119
Air France 119,210 2,076
Zodiac SA 64,039 1,921
--------------
1,087,228
--------------
22
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
GERMANY (9.7%)
Siemens AG 1,256,092 $ 90,721
* Deutsche Telekom AG 3,946,355 68,122
Deutsche Bank AG 820,470 67,618
E.On AG 976,085 64,706
SAP AG 320,611 48,618
Allianz AG 450,962 47,848
DaimlerChrysler AG (Registered) 1,020,927 45,759
BASF AG 849,318 43,820
RWE AG 656,612 28,501
* Bayer AG 1,032,503 28,133
Muenchener Rueckversicherungs-
Gesellschaft AG (Registered) 234,110 25,317
Volkswagen AG 351,835 15,500
Deutsche Post AG 698,594 15,401
DaimlerChrysler AG 327,337 14,534
* Bayerische Hypo-und
Vereinsbank AG 800,378 13,893
Schering AG 262,443 13,795
Commerzbank AG 791,795 13,649
* Infineon Technologies AG 993,098 12,726
Metro AG 228,504 10,132
Continental AG 211,933 9,199
Deutsche Boerse AG 165,480 9,101
ThyssenKrupp AG 486,503 8,445
Adidas-Salomon AG 70,910 8,189
Henkel KGaA 92,792 8,040
Porsche AG 12,276 7,616
Linde AG 130,710 7,148
Altana AG 110,209 7,017
Man AG 167,091 6,137
Puma AG 25,031 5,758
* Hypo Real Estate Holding AG 205,527 5,615
Volkswagen AG Pfd. 164,642 4,936
Deutsche Lufthansa AG 298,408 4,793
Merck KGaA 77,295 4,140
TUI AG 197,445 4,130
Fresenius Medical Care AG 55,313 3,854
Beiersdorf AG 30,509 3,330
* HeidelbergerCement AG 70,269 3,171
Celesio AG 47,185 2,631
RWE AG Pfd. 61,089 2,313
ProSieben Sat.1 Media AG Pfd. 114,609 2,253
Fresenius Medical Care AG 41,521 1,982
Wella AG 21,440 1,955
* EPCOS AG 77,969 1,630
Suedzucker AG 82,504 1,587
* MLP AG 95,463 1,405
Douglas Holding AG 51,064 1,377
Karstadt Quelle AG 64,369 1,368
* ProSiebenSat.1 Media AG 14,326 281
--------------
798,194
--------------
GREECE (0.7%)
National Bank of Greece SA 296,476 $ 8,821
Alpha Credit Bank SA 259,380 8,084
EFG Eurobank Ergasias 292,029 6,210
Hellenic Telecommunication
Organization SA 390,900 5,689
Greek Organization of
Football Prognostics 250,320 4,777
Public Power Corp. 163,500 4,147
Bank of Piraeus 258,285 3,047
Coca-Cola Hellenic
Bottling Co. SA 111,800 2,965
* Commercial Bank of Greece SA 86,060 2,319
Cosmote Mobile
Communications SA 128,600 2,066
Titan Cement Co. SA 44,800 2,038
Hellenic Petroleum SA 170,100 1,517
Viohalco, Hellenic Copper &
Aluminum Industry SA 152,240 971
Hellenic Duty Free Shops SA 37,300 734
Folli-Follie SA 23,797 713
Intracom SA 120,180 692
Hellenic Technodomiki Tev SA 103,900 531
Technical Olympic SA 106,599 475
Aluminum of Greece SA 14,500 266
--------------
56,062
--------------
IRELAND (1.1%)
Allied Irish Banks PLC 1,326,761 19,133
Bank of Ireland 1,529,471 18,536
CRH PLC 829,239 17,595
* Elan Corp. PLC 561,886 12,932
Irish Life & Permanent PLC 423,205 6,555
Kerry Group PLC A Shares 205,478 3,941
* Grafton Group PLC 306,407 2,266
Independent News & Media PLC 866,004 1,972
DCC PLC 124,915 1,902
* Ryanair Holdings PLC 254,112 1,462
Greencore Group PLC 281,934 1,017
* Elan Corp. PLC ADR 45,229 977
Fyffes PLC 474,625 882
Waterford Wedgewood PLC 1,143,094 315
* Ryanair Holdings PLC ADR 8,400 280
Bank of Ireland 6,505 79
Allied Irish Banks PLC 5,475 79
--------------
89,923
--------------
ITALY (5.6%)
ENI SpA 4,070,126 82,749
* Telecom Italia SpA 12,859,405 41,236
Assicurazioni Generali SpA 1,494,590 39,416
* Telecom Italia Mobile SpA 5,935,718 33,870
Unicredito Italiano SpA 6,879,057 32,078
ENEL SpA 3,796,966 30,268
23
- --------------------------------------------------------------------------------
MARKET
VALUE*
EUROPEAN STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
* Telecom Italia SpA RNC 9,072,795 $ 21,154
Banca Intesa SpA 5,879,856 19,454
San Paolo-IMI SpA 1,586,513 18,505
Mediaset SpA 919,853 10,089
Banco Popolare di
Verona e Novara Scrl 581,059 9,668
Riunione Adriatica di
Sicurta SpA 474,054 8,683
* Banche Popolari Unite Scrl 499,306 8,493
Mediobanca Banca di
Credito Finanziaria SpA 732,213 8,488
Alleanza Assicurazioni SpA 728,802 8,064
Finmeccanica Spa 9,185,430 7,014
Banca Antonveneta SpA 361,888 6,941
Snam Rete Gas SpA 1,366,472 6,061
* Autostrade SpA 314,200 5,800
Banca Monte dei
Paschi di Siena SpA 1,723,764 5,373
* Banca Nazionale del
Lavoro (BNL) 2,391,652 5,361
* Capitalia SpA 1,914,264 5,301
* Fiat SpA 688,731 4,846
Banca Intesa SpA Non
Convertible Risp. 1,473,622 3,692
* Banca Popolare di Milano SpA 610,576 3,608
Luxottica Group SpA 211,244 3,469
Pirelli & C. Accomandita
per Azioni 2,907,103 2,934
Banca Fideuram SpA 467,654 2,668
Mediolanum SpA 401,513 2,609
* Autogrill SpA 177,611 2,534
Seat Pagine Gialle SpA 5,094,972 2,254
Bulgari SpA 206,945 1,967
Mondadori (Arnoldo)
Editore SpA 202,614 1,892
Italcementi SpA 125,257 1,569
Gruppo Editoriale
L'Espresso SpA 265,313 1,565
* Tiscali SpA 287,296 1,491
* FinecoGroup SpA 215,937 1,167
* Sorin SpA 373,182 1,049
Benetton Group SpA 82,823 971
* Telecom Italia SpA 1,849,054 809
Parmalat Finanziaria SpA 569,830 75
--------------
455,235
--------------
NETHERLANDS (7.4%)
Royal Dutch Petroleum Co. 3,264,930 158,785
Unilever NV 895,528 58,990
ING Groep NV 2,744,779 58,831
Koninklijke (Royal) Philips
Electronics NV 2,058,933 56,076
ABN-AMRO Holding NV 2,441,979 $ 53,102
Aegon NV 1,964,889 25,721
Koninklijke KPN NV 3,323,041 23,942
* STMicroelectronics NV 916,275 20,199
Akzo Nobel NV 427,271 15,571
Reed Elsevier NV 983,145 13,813
* Koninklijke Ahold NV 1,708,225 13,228
Heineken NV 308,249 13,007
TPG NV 527,652 11,379
European Aeronautic
Defence and Space Co. 448,948 11,356
* ASML Holding NV 677,912 10,792
Verenigde Nederlandse
Uitgeversbedrijven NV 351,572 9,837
Wolters Kluwer NV 433,112 7,295
* Koninklijke Numico NV 235,703 6,527
DSM NV 126,916 6,083
Euronext NV 142,891 4,157
Rodamco Europe NV 70,968 4,114
Corio NV 67,743 2,725
Koninklijke Vendex KBB NV 145,212 2,615
* Qiagen NV 209,080 2,536
Wereldhave NV 32,025 2,457
IHC Caland NV 47,713 2,247
Aegon NV ARS 169,466 2,193
Oce NV 124,223 2,092
Vedior NV 140,544 2,042
* Hagemeyer NV 757,087 1,634
* ASML Holding (New York) 38,580 600
--------------
603,946
--------------
NORWAY (0.7%)
Norsk Hydro ASA 229,921 13,507
Statoil ASA 686,450 8,581
Telenor ASA 1,123,790 7,388
Orkla ASA 302,714 7,325
DNB Holding ASA 1,134,126 7,192
Norske Skogindustrier ASA 164,664 3,000
Storebrand ASA 308,370 1,924
Tandberg ASA 196,112 1,773
Frontline Ltd. 63,777 1,659
* Yara International ASA 226,041 1,598
Schibsted ASA 77,788 1,466
Tomra Systems ASA 273,410 1,100
* Aker Kvaerner ASA 41,348 639
Smedvig ASA A Shares 54,083 516
--------------
57,668
--------------
PORTUGAL (0.5%)
Portugal Telecom SGPS SA 1,474,842 16,000
Electricidade de Portugal SA 2,835,842 7,751
Banco Comercial Portugues SA 3,071,186 7,142
Brisa-Auto Estradas de
Portugal SA 429,947 2,927
24
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
Banco Espirito Santo SA 164,481 $ 2,760
* Banco BPI SA 586,354 2,235
Sonae SGPS SA 1,567,921 1,729
PT Multimedia-Servicos de
Telecomunicacoes e
Multimedia, SGPS, SA 74,273 1,688
Cimpor-Cimento de Portugal SA 258,527 1,361
* Jeronimo Martins & Filho,
SGPS, SA 43,914 472
--------------
44,065
--------------
SPAIN (5.2%)
Telefonica SA 6,803,891 101,218
Banco Santander Central
Hispano SA 6,718,329 72,160
Banco Bilbao Vizcaya
Argentaria SA 5,041,118 66,534
Repsol-YPF SA 1,433,453 30,192
Endesa SA 1,411,977 25,880
Iberdrola SA 1,200,251 23,668
Banco Popular Espanol SA 248,625 13,719
Altadis SA 431,051 12,184
Telefonica SA ADR 190,681 8,415
Gas Natural SDG SA 315,588 7,744
Industria de Diseno Textil SA 342,596 7,450
ACS, Actividades de
Construccion y Servicios, SA 148,590 7,219
Union Fenosa SA 311,637 6,475
Abertis Infraestructuras SA 346,506 5,786
Acerinox SA 77,812 4,013
Grupo Ferrovial, SA 98,933 3,946
Amadeus Global Travel
Distribution SA 503,279 2,968
Fomento de Construc y
Contra SA 81,891 2,909
Acciona SA 45,116 2,788
Indra Sistemas, SA 196,944 2,554
Sacyr Vallehermoso SA 152,876 2,388
Iberia (Linea Aer Espana) 709,178 2,355
Promotora de Informaciones SA 120,023 2,139
Corporacion Mapfre SA 165,228 1,981
* Telefonica Publicidad e
Informacion, SA 255,022 1,868
* Antena 3 Television 31,962 1,625
* Zeltia SA 229,746 1,529
Sociedad General de Aguas
de Barcelona SA 90,368 1,452
* NH Hoteles SA 130,300 1,370
--------------
424,529
--------------
SWEDEN (3.3%)
* Telefonaktiebolaget LM
Ericsson AB Class B 23,026,692 62,394
Nordea Bank AB 3,666,101 $ 24,714
Hennes & Mauritz AB B Shares 741,944 18,161
Svenska Handelsbanken
AB A Shares 863,786 16,678
* Volvo AB B Shares 356,400 12,200
Svenska Cellulosa AB B Shares 304,660 11,944
Sandvik AB 344,511 11,206
Skandinaviska Enskilda
Banken AB A Shares 732,982 10,650
TeliaSonera AB 2,557,858 10,513
Electrolux AB Series B 464,379 9,179
* Tele2 AB B Shares 147,688 6,708
Securitas AB B Shares 461,911 6,651
Atlas Copco AB A Shares 175,869 6,170
Assa Abloy AB 457,791 5,573
Swedish Match AB 523,754 5,279
* Volvo AB A Shares 153,003 5,048
Skandia Forsakrings AB 1,283,644 5,041
Skanska AB B Shares 614,172 4,944
SKF AB B Shares 138,838 4,762
Atlas Copco AB B Shares 108,961 3,523
Getinge AB B SHS 248,000 2,857
Gambro AB A Shares 271,464 2,381
Trelleborg AB B Shares 124,139 2,234
Holmen AB 77,000 2,172
Eniro AB 254,500 2,065
* Fabege AB B Shares 123,218 1,605
Alfa Laval AB 104,590 1,574
Svenskt Stal AB A Shares 89,952 1,478
Billerud Aktiebolag 91,200 1,450
Castellum AB 64,270 1,392
* Modern Times Group AB 80,483 1,359
Svenska Handelsbanken AB
B Shares 69,756 1,333
Gambro AB B Shares 146,897 1,279
* OM HEX AB 92,481 1,247
WM-Data AB Class B 497,140 1,106
* SAS AB 119,988 1,060
Hoganas AB B Shares 42,400 1,032
SKF AB A Shares 28,775 991
Axfood AB 37,701 871
Svenskt Stal AB 42,219 669
* Fabege AB Rights
Exp. 5/27/2004 123,218 204
* Electrolux AB Redemption
Rights Exp. 5/26/2004 464,379 149
--------------
271,846
--------------
SWITZERLAND (10.6%)
Novartis AG (Registered) 3,732,230 166,376
Nestle SA (Registered) 632,422 159,983
UBS AG 1,813,954 128,919
25
- --------------------------------------------------------------------------------
MARKET
VALUE*
EUROPEAN STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
Roche Holdings AG 1,101,055 $ 115,489
Credit Suisse Group (Registered) 1,863,435 65,679
Zurich Financial Services AG 225,652 35,677
Swiss Re (Registered) 504,666 33,201
Cie. Financiere Richemont AG 823,017 21,169
* ABB Ltd. 2,719,565 15,311
Syngenta AG 168,201 13,459
Swisscom AG 41,517 12,888
Holcim Ltd. (Registered) 236,152 12,194
* Adecco SA (Registered) 204,625 9,145
Synthes-Stratec Inc. 6,890 7,487
CIBA Specialty Chemicals AG
(Registered) 107,440 7,458
Roche Holdings AG (Bearer) 50,276 7,406
Swatch Group AG (Bearer) 51,825 6,885
Serono SA Class B 10,948 6,561
Givaudan SA 11,308 5,625
* Nobel Biocare Holding AG 31,915 4,324
Clariant AG 324,807 4,121
SGS Societe Generale de
Surveillance Holding SA
(Registered) 6,834 3,584
Geberit AG 5,507 3,347
* Logitech International SA 68,192 2,958
Lonza AG (Registered) 58,669 2,833
UBS AG 35,370 2,504
Schindler Holding AG (Ptg. Ctf) 8,749 2,385
Swatch Group AG (Registered) 87,498 2,355
Unaxis Holding AG 16,705 1,894
Kuoni Reisen Holding AG
(Registered) 4,740 1,846
* Kudelski SA 50,517 1,529
Valora Holding AG 6,314 1,483
* Sulzer AG (Registered) 5,397 1,399
--------------
867,474
--------------
UNITED KINGDOM (36.2%)
BP PLC 31,183,976 269,590
HSBC Holdings PLC 17,156,134 245,826
Vodafone Group PLC 95,105,205 231,059
GlaxoSmithKline PLC 9,328,209 193,049
Royal Bank of Scotland
Group PLC 4,394,593 131,939
AstraZeneca Group PLC 2,664,814 124,616
Shell Transport &
Trading Co. PLC 15,150,179 104,512
Barclays PLC 10,246,416 92,398
HBOS PLC 6,019,726 77,982
Lloyds TSB Group PLC 8,755,404 65,444
Diageo PLC 4,834,278 64,854
Tesco PLC 11,954,080 52,732
BT Group PLC 13,579,655 42,986
Unilever PLC 4,333,174 $ 40,880
British American Tobacco PLC 2,469,449 37,442
Rio Tinto PLC 1,670,525 36,645
National Grid Transco PLC 4,822,062 36,578
Aviva PLC 3,536,436 34,555
BG Group PLC 5,526,498 31,925
BHP Billiton PLC 3,865,701 30,883
BP PLC ADR 575,360 30,437
Vodafone Group PLC ADR 1,177,400 28,893
Centrica PLC 6,694,436 25,940
Cadbury Schweppes PLC 3,226,696 25,664
Imperial Tobacco Group PLC 1,142,530 25,306
Prudential PLC 3,147,231 24,725
Reckitt Benckiser PLC 940,826 24,459
British Sky Broadcasting
Group PLC 1,974,608 23,321
GUS PLC 1,584,387 21,944
Compass Group PLC 3,395,252 21,375
Reed Elsvier PLC 1,991,136 18,538
Kingfisher PLC 3,624,528 18,206
BAE Systems PLC 4,802,134 17,862
Marks & Spencer Group PLC 3,551,662 17,399
Legal & General Group PLC 10,217,970 16,942
Scottish & Southern
Energy PLC 1,343,263 16,258
ScottishPower PLC 2,291,321 15,573
BAA PLC 1,676,743 15,462
Reuters Group PLC 2,241,934 14,830
Smith & Nephew PLC 1,457,569 14,798
Pearson PLC 1,259,440 14,696
WPP Group PLC 1,458,852 14,384
Land Securities Group PLC 730,117 14,191
ITV PLC 6,375,241 13,962
SABMiller PLC 1,255,137 13,622
Boots Group PLC 1,234,832 13,380
Wolseley PLC 908,196 13,311
Man Group PLC 438,300 13,120
BOC Group PLC 778,829 12,521
Carnival PLC 260,469 11,672
J. Sainsbury PLC 2,279,727 11,259
Hilton Group PLC 2,471,865 10,893
Smiths Group PLC 874,677 10,835
InterContinental Hotels
Group PLC 1,157,243 10,815
Next PLC 431,668 10,679
3i Group PLC 955,324 10,216
Rolls-Royce Group PLC 2,349,638 9,646
Rentokil Initial PLC 2,875,963 9,588
Scottish & Newcastle PLC 1,250,450 9,108
Hanson Building Materials PLC 1,158,879 8,837
British Land Co., PLC 762,432 8,782
26
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
Dixons Group PLC 3,060,397 $ 8,426
United Utilities PLC 874,870 8,355
* Cable and Wireless PLC 3,746,753 8,206
Severn Trent PLC 539,052 7,485
Imperial Chemical
Industries PLC 1,872,261 7,280
Rexam PLC 865,242 7,008
Amvescap PLC 1,061,305 6,997
Royal & Sun Alliance
Insurance Group PLC 4,552,650 6,479
Friends Provident PLC 2,587,031 6,469
William Hill PLC 666,193 6,332
Emap PLC 402,776 6,175
Yell Group PLC 1,094,534 6,163
Whitbread PLC 463,560 6,124
Bunzl PLC 707,983 5,917
Enterprise Inns PLC 546,811 5,915
The Sage Group PLC 1,915,053 5,867
Exel PLC 465,293 5,858
Tomkins PLC 1,208,240 5,796
Daily Mail and General Trust 482,897 5,742
Capita Group PLC 1,038,528 5,709
EMI Group PLC 1,244,555 5,694
Signet Group PLC 2,706,292 5,555
Johnson Matthey PLC 343,606 5,438
Hays PLC 2,589,287 5,418
Rank Group PLC 937,680 5,288
Liberty International PLC 396,031 5,187
Slough Estates PLC 658,366 5,143
Hammerson PLC 431,956 5,113
Provident Financial PLC 398,339 5,086
Kelda Group PLC 610,528 5,024
Persimmon PLC 431,333 5,018
BPB PLC 777,120 5,009
Taylor Woodrow PLC 939,383 4,698
GKN PLC 1,150,677 4,673
* Corus Group PLC 6,939,095 4,553
LogicaCMG PLC 1,180,272 4,542
The Peninsular & Oriental
Steam Navigation Co. 1,157,278 4,438
George Wimpey PLC 607,281 4,418
* International Power PLC 1,761,553 4,389
RMC Group PLC 417,976 4,362
United Business Media PLC 531,194 4,333
Electrocomponents PLC 681,206 4,307
Brambles Industries PLC 1,147,977 4,275
ScottishPower PLC ADR 154,280 4,266
* British Airways PLC 844,384 4,230
Kesa Electricals PLC 836,071 4,181
Cobham PLC 174,718 4,139
Alliance Unichem PLC 390,738 4,133
Barratt Developments PLC 377,108 $ 4,123
Associated British Ports
Holdings PLC 516,323 4,038
WPP Group PLC ADR 78,406 3,865
* Canary Wharf Group PLC 741,158 3,851
Mitchells & Butlers PLC 822,350 3,690
IMI PLC 555,585 3,682
Tate & Lyle PLC 642,030 3,461
Close Brothers Group PLC 227,889 3,310
ARM Holdings PLC 1,599,120 3,304
Misys PLC 885,983 3,260
* Celltech Group PLC 436,906 3,256
BBA Group PLC 715,792 3,224
Cattles PLC 508,389 3,128
* Invensys PLC 8,987,444 3,108
FirstGroup PLC 649,475 3,092
The Berkeley Group PLC 172,663 3,001
Balfour Beatty PLC 663,968 2,961
United Utilities plc 485,061 2,942
Aegis Group PLC 1,747,786 2,797
MFI Furniture Group PLC 948,178 2,636
Kidde PLC 1,320,471 2,623
Serco Group PLC 681,068 2,597
Amec PLC 469,277 2,517
Stagecoach Group PLC 1,677,627 2,447
Pilkington PLC 1,585,897 2,334
Schroders PLC 197,714 2,218
The Davis Service Group PLC 317,472 2,162
FKI PLC 924,616 1,861
Securicor PLC 815,259 1,764
SSL International PLC 292,491 1,701
De La Rue Group PLC 282,828 1,655
Novar PLC 691,353 1,569
Great Portland Estates PLC 249,830 1,152
Aggreko PLC 387,415 1,104
--------------
2,968,990
--------------
- --------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(COST $6,881,376) 8,149,034
- --------------------------------------------------------------------------------
27
- --------------------------------------------------------------------------------
FACE MARKET
AMOUNT VALUE*
EUROPEAN STOCK INDEX FUND (000) (000)
- --------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS (20.3%) (1)
- --------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSN.
(2) 1.05%, 7/14/2004 $ 3,000 $ 2,994
REPURCHASE AGREEMENTS
Collateralized by U.S. Government
Obligations in a Pooled
Cash Account
1.04%, 5/3/2004 10,957 10,957
1.04%, 5/3/2004--Note F 1,652,356 1,652,356
- --------------------------------------------------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS
(COST $1,666,307) 1,666,307
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS (119.7%)
(COST $8,547,683) 9,815,341
- --------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-19.7%)
- --------------------------------------------------------------------------------
Other Assets--Note B 56,972
Security Lending Collateral Payable
to Brokers--Note F (1,652,356)
Other Liabilities (21,309)
--------------
(1,616,693)
--------------
- --------------------------------------------------------------------------------
NET ASSETS (100%) $8,198,648
================================================================================
* See Note A in Notes to Financial Statements.
* Non-income-producing security.
(1) The fund invests a portion of its cash reserves in equity markets through
the use of index futures contracts. After giving effect to futures investments,
the fund's effective common stock and temporary cash investment positions
represent 99.8% and 19.9%, respectively, of net assets. See Note D in Notes to
Financial Statements.
(2) Security segregated as initial margin for open futures contracts.
ADR--American Depositary Receipt.
(Ptg. Ctf.)--Participating Certificate.
- --------------------------------------------------------------------------------
AMOUNT
(000)
- --------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- --------------------------------------------------------------------------------
Paid-in Capital $7,222,729
Undistributed Net Investment Income 79,013
Accumulated Net Realized Losses (370,354)
Unrealized Appreciation (Depreciation)
Investment Securities 1,267,658
Futures Contracts 610
Foreign Currencies and
Forward Currency Contracts (1,008)
- --------------------------------------------------------------------------------
NET ASSETS $8,198,648
================================================================================
Investor Shares--Net Assets
Applicable to 311,448,214 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $6,852,659
NET ASSET VALUE PER SHARE--
INVESTOR SHARES $22.00
- --------------------------------------------------------------------------------
Admiral Shares--Net Assets
Applicable to 10,957,699 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $566,133
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
ADMIRAL SHARES $51.67
================================================================================
Institutional Shares--Net Assets
Applicable to 35,418,831 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $779,856
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
INSTITUTIONAL SHARES $22.02
================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
28
- --------------------------------------------------------------------------------
MARKET
VALUE*
PACIFIC STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
COMMON STOCKS (100.1%)(1)
- --------------------------------------------------------------------------------
AUSTRALIA (16.6%)
National Australia Bank Ltd. 2,603,988 $ 55,421
BHP Billiton Ltd. 6,484,049 53,711
Commonwealth
Bank of Australia 2,181,735 49,239
Australia & New Zealand
Bank Group Ltd. 3,116,207 41,792
News Corp. Ltd. Pfd. 4,669,028 39,958
Westpac Banking Corp., Ltd. 3,096,117 39,063
News Corp. Ltd. 2,360,427 21,769
Woolworths Ltd. 1,764,403 15,036
AMP Ltd. 3,217,011 13,406
Wesfarmers Ltd. 644,368 13,300
Telstra Corp. Ltd. 3,721,482 12,847
Rio Tinto Ltd. 538,639 12,654
Foster's Group Ltd. 3,533,014 12,477
Coles Myer Ltd. 1,895,810 11,460
Westfield Trust (Units) 3,784,621 11,097
Insurance Australia Group Ltd. 2,907,141 10,204
QBE Insurance Group Ltd. 1,159,275 9,754
Woodside Petroleum Ltd. 804,252 9,607
Macquarie Bank Ltd. 367,198 9,189
Suncorp-Metway Ltd. 921,428 8,917
Rinker Group Ltd. 1,643,731 8,452
Stockland 2,202,728 8,224
General Property Trust 3,521,736 7,656
Amcor Ltd. 1,521,012 7,623
Westfields Holdings Ltd. 730,369 7,474
Alumina Ltd. 1,965,452 7,197
WMC Resources Ltd. 1,971,207 6,819
Tabcorp Holdings Ltd. 714,804 6,808
Brambles Industries Ltd. 1,661,667 6,660
Australian Gas Light Co., Ltd. 783,868 6,595
Macquarie Infrastucture Group 3,317,349 6,588
Bluescope Steel Ltd. 1,314,093 5,580
CSL Ltd. 329,390 5,248
Orica Ltd. 483,929 5,162
Lend Lease Corp. 635,875 4,900
Santos Ltd. 1,022,920 4,750
Origin Energy Ltd. 1,147,482 4,724
Newcrest Mining Ltd. 569,824 4,691
Boral Ltd. 993,907 4,307
James Hardie Industries NV 806,755 3,904
Coca-Cola Amatil Ltd. 771,767 3,840
John Fairfax Holdings Ltd. 1,508,328 3,649
Mirvac Group 1,177,927 3,573
Macquarie Goodman
Industrial Trust 2,688,541 3,223
Investa Property Group 2,403,163 3,211
Patrick Corp. Ltd. 862,350 3,176
Centro Properties Group 1,067,071 $ 3,067
Southcorp Ltd. 1,123,742 2,897
Toll Holdings Ltd. 375,506 2,818
Paperlinx Ltd. 780,086 2,817
Mayne Group Ltd. 1,217,789 2,806
Sonic Healthcare Ltd. 410,373 2,673
Transurban Group 796,319 2,611
Tab Ltd. 758,666 2,537
CSR Ltd. 1,697,953 2,354
Lion Nathan Ltd. 501,242 2,262
CFS Gandel Retail Trust 2,187,910 2,165
Australian Stock Exchange Ltd. 169,361 1,968
Publishing & Broadcasting Ltd. 221,462 1,948
Harvey Norman Holdings Ltd. 902,173 1,836
Leighton Holdings Ltd. 236,778 1,770
Commonwealth Property
Office Fund 2,146,912 1,767
Computershare Ltd. 737,816 1,599
Aristocrat Leisure Ltd. 532,701 1,554
Deutsche Office Trust 1,932,296 1,535
OneSteel Ltd. 940,204 1,528
Ansell Ltd. 278,310 1,524
Cochlear Ltd. 93,951 1,349
Iluka Resources Ltd. 391,621 1,106
Futuris Corp., Ltd. 968,395 1,056
--------------
644,482
--------------
HONG KONG (5.4%)
Hutchison Whampoa Ltd. 3,695,600 24,875
Cheung Kong Holdings Ltd. 2,607,100 19,972
Sun Hung Kai Properties Ltd. 2,283,800 19,618
Hang Seng Bank Ltd. 1,322,646 16,788
CLP Holdings Ltd. 3,130,899 16,658
Boc Hong Kong Holdings Ltd. 6,419,000 10,945
Hong Kong & China Gas Co., Ltd. 6,318,651 10,855
Hong Kong Electric Holdings Ltd. 2,401,400 10,560
Swire Pacific Ltd. A Shares 1,604,400 10,491
Bank of East Asia Ltd. 2,393,073 6,995
Wharf Holdings Ltd. 2,110,714 5,791
Henderson Land
Development Co. Ltd. 1,269,000 5,694
Li & Fung Ltd. 2,759,500 4,299
Esprit Holdings Ltd. 1,038,000 4,259
* PCCW Ltd. 5,598,569 3,840
Hong Kong Exchanges &
Clearing Ltd. 1,775,000 3,550
MTR Corp. 2,328,500 3,538
Cathay Pacific Airways Ltd. 1,773,000 3,216
New World
Development Co., Ltd. 3,910,975 3,134
Hang Lung Properties Ltd. 2,018,500 2,730
Television Broadcasts Ltd. 507,000 2,366
29
- --------------------------------------------------------------------------------
MARKET
VALUE*
PACIFIC STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
Johnson Electric Holdings Ltd. 2,618,600 $ 2,317
Yue Yuen Industrial
(Holdings) Ltd. 828,000 2,235
Techtronic Industries Co., Ltd. 786,000 2,106
Cheung Kong Infrastructure
Holdings Ltd. 793,000 1,896
Hopewell Holdings Ltd. 1,033,000 1,828
Shangri-La Asia Ltd. 1,806,744 1,772
Hysan Development Co., Ltd. 1,062,211 1,757
Sino Land Co. 2,623,600 1,589
Giordano International Ltd. 2,453,108 1,407
ASM Pacific Technology Ltd. 288,000 1,193
SCMP Group Ltd. 1,574,546 666
Texwinca Holdings Limited 866,000 644
SmarTone
Telecommunications Ltd. 435,000 482
--------------
210,066
--------------
JAPAN (74.6%)
Toyota Motor Corp. 4,649,200 165,071
Canon, Inc. 1,440,000 74,193
Mitsubishi Tokyo
Financial Group Inc. 7,186 62,798
NTT DoCoMo, Inc. 29,906 58,281
Takeda Chemical Industries Ltd. 1,454,100 57,581
Sony Corp. 1,513,138 57,494
Honda Motor Co., Ltd. 1,338,200 52,753
Matsushita Electric
Industrial Co., Ltd. 3,580,945 51,653
Mizuho Financial Group, Inc. 10,957 50,896
Nomura Holdings Inc. 3,040,000 48,476
Sumitomo Mitsui
Financial Group, Inc. 6,455 47,905
Nippon Telegraph and
Telephone Corp. 9,062 46,771
Nissan Motor Co., Ltd. 4,255,400 46,538
Tokyo Electric Power Co. 1,976,700 41,599
UFJ Holdings Inc. 6,105 37,105
Millea Holdings, Inc. 2,553 35,667
Hitachi Ltd. 4,913,000 33,882
East Japan Railway Co. 5,841 29,315
Sharp Corp. 1,620,000 28,687
Fuji Photo Film Co., Ltd. 796,000 25,145
Ito-Yokado Co., Ltd. 611,000 24,956
Murata Manufacturing Co., Ltd. 382,200 24,624
Shin-Etsu Chemical Co., Ltd. 616,700 24,475
Seven Eleven Japan Co. Ltd. 703,000 23,459
Kyocera Corp. 279,200 22,683
Rohm Co., Ltd. 183,600 22,497
Chubu Electric Power Co. 1,076,300 22,028
Kao Corp. 928,000 21,759
NEC Corp. 2,778,000 21,432
Ricoh Co. 1,088,000 $ 21,300
Toshiba Corp. 4,699,000 21,199
Hoya Corp. 189,600 20,145
Mitsui Sumitomo Insurance Co. 2,162,530 19,994
Kansai Electric Power Co., Inc. 1,158,900 19,914
Mitsubishi Estate Co., Ltd. 1,673,000 19,428
Nippon Steel Corp. 9,332,000 19,182
Fujitsu Ltd. 2,742,000 18,715
Bridgestone Corp. 1,110,500 18,460
JFE Holdings, Inc. 794,800 17,504
Softbank Corp. 391,500 17,419
Yamanouchi
Pharmaceuticals Co., Ltd. 528,900 17,320
Aeon Co., Ltd. 401,000 17,270
Denso Corp. 833,300 17,240
Mitsui & Co., Ltd. 2,039,000 16,511
Mitsubishi Corp. 1,744,000 16,326
Tokyo Gas Co., Ltd. 4,340,000 15,794
Nintendo Co. 169,700 15,736
Tokyo Electron Ltd. 262,930 15,722
Dai-Nippon Printing Co., Ltd. 1,039,000 15,477
* Resona Holdings Inc. 7,793,000 15,465
Daiwa Securities Group Inc. 2,051,000 15,148
Fanuc Co., Ltd. 246,300 14,816
Nitto Denko Corp. 268,700 14,657
Mitsubishi Electric Corp. 2,939,000 14,594
Orix Corp. 137,500 14,316
Secom Co., Ltd. 339,000 14,268
Asahi Glass Co., Ltd. 1,311,000 13,626
TDK Corp. 193,800 13,589
Mitsubishi Heavy
Industries Ltd. 4,927,000 13,329
Mitsui Fudosan Co., Ltd. 1,198,000 12,953
Keyence Corp. 54,880 12,942
Nikko Securities Co., Ltd. 2,210,000 12,351
Central Japan Railway Co. 1,532 12,297
Nippon Oil Corp. 2,208,600 11,949
Kyushu Electric Power Co., Inc. 691,400 11,690
Tohoku Electric Power Co. 733,900 11,579
Kirin Brewery Co., Ltd. 1,183,000 11,517
Sanyo Electric Co., Ltd. 2,571,000 11,439
Asahi Kasei Corp. 2,105,000 11,295
Sompo Japan Insurance Inc. 1,272,000 11,263
West Japan Railway Co. 2,927 11,174
Toppan Printing Co., Ltd. 959,000 11,068
Sankyo Co., Ltd. 604,700 11,004
Ajinomoto Co., Inc. 954,000 10,959
* T & D Holdings, Inc. 270,100 10,575
SMC Corp. 92,700 10,435
Fujisawa
Pharmaceutical Co., Ltd. 455,200 10,390
30
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
Yamato Transport Co., Ltd. 686,000 $ 10,237
Promise Co., Ltd. 150,550 9,780
Sumitomo Trust &
Banking Co., Ltd. 1,621,000 9,577
Eisai Co., Ltd. 380,900 9,558
* Itochu Corp. 2,300,000 9,558
Japan Tobacco, Inc. 1,202 9,434
Osaka Gas Co., Ltd. 3,448,000 9,389
Sumitomo Electric
Industries Ltd. 1,029,000 9,340
Konica Minolta Holdings, Inc. 683,000 9,287
Toray Industries, Inc. 2,042,000 9,176
Komatsu Ltd. 1,626,000 9,101
Sumitomo Chemical Co. 1,989,000 9,027
Sumitomo Corp. 1,180,000 8,894
Bank of Yokohama Ltd. 1,653,000 8,869
Sekisui House Ltd. 851,000 8,860
Marui Co., Ltd. 568,300 8,758
Kinki Nippon Railway Co. 2,482,150 8,747
Acom Co., Ltd. 124,310 8,695
Omron Corp. 362,700 8,682
Shizuoka Bank Ltd. 1,024,000 8,584
OJI Paper Co., Ltd. 1,372,000 8,412
Daiwa House Industry Co., Ltd. 757,000 8,320
Advantest Corp. 110,900 8,279
NTT Data Corp. 2,152 8,272
Tokyu Corp. 1,661,000 8,144
Tostem Inax Holding Corp. 428,408 8,005
Shionogi & Co., Ltd. 514,000 7,944
Nippon Express Co., Ltd. 1,367,000 7,846
Mitsubishi Chemical Corp. 2,809,000 7,499
Nippon Unipac Holding 1,524 7,446
Pioneer Corp. 263,200 7,378
Daikin Industries Ltd. 317,000 7,292
Aiful Corp. 72,950 7,271
Asahi Breweries Ltd. 657,300 7,253
Kubota Corp. 1,700,000 7,246
Daiichi Pharmaceutical Co., Ltd. 419,800 7,225
Sumitomo Realty &
Development Co. 642,000 7,078
Takefuji Corp. 112,440 7,013
Shiseido Co., Ltd. 579,000 6,992
Chugai Pharmaceutical Co., Ltd. 468,700 6,965
Fast Retailing Co., Ltd. 90,300 6,910
Olympus Corp. 361,000 6,874
Credit Saison Co., Ltd. 233,700 6,717
Nidec Corp. 60,400 6,402
JSR Corp. 307,500 6,362
Mitsui Trust Holding Inc. 912,400 6,341
Sumitomo Metal
Industries Ltd. 5,327,000 6,304
Nippon Yusen Kabushiki
Kaisha Co. 1,571,000 $ 6,277
Terumo Corp. 289,100 6,020
Trend Micro Inc. 158,500 5,966
Toyoda Automatic
Loom Works Ltd. 277,200 5,920
Hirose Electric Co., Ltd. 51,300 5,775
Chiba Bank Ltd. 1,080,000 5,766
Mitsui Osk Lines Ltd. 1,333,000 5,729
Taisho Pharmaceutical Co. 292,000 5,598
Oriental Land Co., Ltd. 85,300 5,434
Marubeni Corp. 2,172,000 5,374
Toto Ltd. 509,000 5,345
Takashimaya Co. 450,000 5,329
Kajima Corp. 1,542,000 5,297
Sumitomo Metal Mining Co. 884,000 5,278
Tobu Railway Co., Ltd. 1,244,000 5,236
Nikon Corp. 445,000 5,112
Daito Trust Construction Co., Ltd. 149,600 4,979
Yokogawa Electric Corp. 369,000 4,922
Mitsui Chemicals, Inc. 949,000 4,906
Keio Electric Railway Co., Ltd. 890,000 4,894
Yamaha Corp. 264,800 4,878
Sekisui Chemical Co. 695,000 4,830
Stanley Electric Co. 258,900 4,804
CSK Corp. 111,800 4,775
Ohbayashi Corp. 1,001,000 4,757
Bank of Fukuoka, Ltd. 920,000 4,757
Taisei Corp. 1,335,000 4,598
Kuraray Co., Ltd. 623,000 4,590
Joyo Bank Ltd. 1,164,000 4,444
Citizen Watch Co., Ltd. 448,000 4,437
Matsushita Electric Works, Ltd. 496,000 4,414
Toyo Seikan Kaisha Ltd. 242,000 4,291
Yamada Denki Co., Ltd. 126,800 4,277
ToneGeneral Sekiyu K.K. 501,000 4,151
Teijin Ltd. 1,373,000 4,057
Keihin Electric Express
Railway Co., Ltd. 657,000 3,905
Nomura Research Institute, Ltd. 38,200 3,879
Isetan Co. 284,700 3,861
Seiko Epson Corp. 100,200 3,861
Mitsui Mining &
Smelting Co., Ltd. 932,000 3,856
Kaneka Corp. 421,000 3,817
Alps Electric Co., Ltd. 263,000 3,721
JAFCO Co., Ltd. 46,000 3,684
Lawson Inc. 99,800 3,677
Showa Denko K.K. 1,644,000 3,672
Konami Corp. 143,700 3,619
Casio Computer Co. 319,000 3,614
31
- --------------------------------------------------------------------------------
MARKET
VALUE*
PACIFIC STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
Kyowa Hakko Kogyo Co. 553,000 $ 3,612
Nippon Mining Holdings Inc. 873,500 3,607
Shimizu Corp. 868,000 3,599
Ushio Inc. 195,000 3,574
Furukawa Electric Co. 942,000 3,571
Mabuchi Motor Co. 52,600 3,562
* Oki Electric Industry Co. Ltd. 880,000 3,547
Nissin Food Products Co., Ltd. 140,500 3,445
Kawasaki Kisen Kaisha Ltd. 813,000 3,422
Onward Kashiyama Co., Ltd. 228,000 3,411
NGK Insulators Ltd. 454,000 3,345
Toho Co., Ltd. 222,600 3,332
77 Bank Ltd. 563,000 3,327
Taiheiyo Cement Corp. 1,309,000 3,320
Uni-Charm Corp. 70,800 3,289
Kawasaki Heavy Industries Ltd. 2,144,000 3,224
* Japan Airlines System Co. 1,101,000 3,223
Nippon Meat Packers, Inc. 274,000 3,207
Yamaha Motor Co., Ltd. 227,000 3,188
Mitsukoshi, Ltd. 610,000 3,187
NSK Ltd. 699,000 3,160
Hitachi Chemical Co., Ltd. 174,200 3,132
Daimaru, Inc. 364,000 3,113
THK Co., Inc. 163,500 3,106
Mitsubishi Materials Corp. 1,582,000 3,069
FamilyMart Co., Ltd. 108,700 3,066
Sankyo Co., Ltd. 83,300 3,054
USS Co., Ltd. 36,630 3,041
Fujikura Ltd. 565,000 3,007
Uny Co., Ltd. 261,000 3,001
Oracle Corp. Japan 54,200 2,995
NTN Corp. 711,000 2,986
Amada Co., Ltd. 533,000 2,945
Mitsubishi Rayon Co., Ltd. 844,000 2,907
Hokugin Financial Group, Inc. 1,323,000 2,896
Shimano, Inc. 125,500 2,887
Benesse Corp. 106,700 2,886
JGC Corp. 328,000 2,855
Taiyo Yuden Co., Ltd. 173,000 2,840
Gunma Bank Ltd. 616,000 2,834
Bandai Co., Ltd. 118,100 2,811
Yakult Honsha Co., Ltd. 196,000 2,800
Shimamura Co., Ltd. 34,100 2,761
Skylark Co., Ltd. 139,900 2,696
* Ishikawajima-Harima Heavy
Industries Co. 1,824,000 2,678
Tosoh Corp. 758,000 2,617
Dai-Nippon Ink & Chemicals, Inc. 1,081,000 2,597
Minebea Co., Ltd. 539,000 2,586
Nisshin Seifun Group Inc. 285,000 2,579
Aeon Credit Service Co. Ltd. 41,130 2,566
Office Building Fund of Japan Inc. 354 $ 2,548
All Nippon Airways Co., Ltd. 845,000 2,519
Dowa Mining Co. Ltd. 463,000 2,517
Makita Corp. 189,000 2,513
NGK Spark Plug Co. 272,000 2,472
Japan Real Estate
Investment Corp. 362 2,458
The Suruga Bank, Ltd. 336,000 2,449
Susuken Co., Ltd. 79,920 2,404
Kamigumi Co., Ltd. 345,000 2,349
World Co., Ltd. 69,700 2,308
Toyoda Gosei Co., Ltd. 84,500 2,270
Central Glass Co., Ltd. 312,000 2,263
Fuji Electric Holdings Co., Ltd. 867,000 2,261
Takara Holdings Inc. 277,000 2,253
Denki Kagaku Kogyo K.K. 686,000 2,253
* Sumitomo Heavy Industries Ltd. 875,000 2,250
TIS Inc. 60,100 2,241
Hino Motors, Ltd. 384,000 2,238
Shimachu Co. 84,400 2,215
Obic Co., Ltd. 10,200 2,174
Aoyama Trading Co., Ltd. 93,000 2,110
Mitsubishi Gas Chemical Co. 565,000 2,082
Ube Industries Ltd. 1,243,000 2,068
Kurita Water Industries Ltd. 170,200 2,058
Ebara Corp. 421,000 2,056
Seino Transportation Co., Ltd. 208,000 2,019
* Sega Corp. 196,300 2,019
Mitsui Engineering &
Shipbuilding Co., Ltd. 1,151,000 2,018
Itochu Techno-Science Corp. 52,900 1,995
Toyobo Ltd. 933,000 1,968
Kikkoman Corp. 251,000 1,961
Meiji Seika Kaisha Ltd. 480,000 1,956
Yamazaki Baking Co., Ltd. 201,000 1,936
Nippon Sheet Glass Co., Ltd. 563,000 1,929
Ito En, Ltd. 45,700 1,915
Nissan Chemical Industries, Ltd. 260,000 1,913
Meitec Corp. 55,000 1,904
Daicel Chemical Industries Ltd. 430,000 1,868
Showa Shell Sekiyu K.K. 220,400 1,859
Toyo Suisan Kaisha, Ltd. 139,000 1,853
Nichii Gakkan Co. 33,640 1,716
Dai-Nippon Screen
Manufacturing Co., Ltd. 253,000 1,695
Sumitomo Bakelite Co. Ltd. 263,000 1,692
Teikoku Oil Co., Ltd. 334,000 1,682
Hankyu Department Stores, Inc. 205,000 1,669
Koyo Seiko Co., Ltd. 161,000 1,654
Sapparo Holdings Ltd. 473,000 1,624
Namco Ltd. 61,000 1,612
32
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
Matsumotokiyoshi Co., Ltd. 53,900 $ 1,602
Meiji Dairies Corp. 345,000 1,594
Nippon Shokubai Co., Ltd. 226,000 1,593
Gunze Ltd. 335,000 1,592
House Foods Industry Corp. 118,500 1,577
Q.P. Corp. 184,700 1,545
Coca-Cola West Japan Co. Ltd. 68,600 1,520
Wacoal Corp. 150,000 1,504
Mitsubishi Logistics Corp. 169,000 1,502
Nisshinbo Industries, Inc. 235,000 1,500
Sumitomo Osaka
Cement Co., Ltd. 602,000 1,479
Asatsu-DK Inc. 52,400 1,464
Nippon Sanso Corp. 327,000 1,463
Okumura Corp. 308,000 1,439
Hitachi Cable Ltd. 289,000 1,430
Kokuyo Co., Ltd. 117,800 1,429
Komori Corp. 89,000 1,404
Nichirei Corp. 424,000 1,389
Nishimatsu Construction Co. 401,000 1,389
Tokyo Style Co. 131,000 1,354
Dentsu Inc. 490 1,347
Net One Systems Co., Ltd. 320 1,338
Kinden Corp. 221,000 1,330
Comsys Holdings Corp. 178,000 1,253
Katokichi Co., Ltd. 68,500 1,219
* Dentsu Inc. 436 1,199
Aderans Co. Ltd. 58,400 1,164
Nippon Kayaku Co., Ltd. 220,000 1,161
Sanden Corp. 173,000 1,161
Mitsumi Electric Co., Ltd. 109,200 1,161
Fuji Television Network, Inc. 452 1,150
Autobacs Seven Co., Ltd. 43,500 1,150
Toda Corp. 326,000 1,149
Tokyo Broadcasting System, Inc. 57,700 1,129
* Net One Systems Co., Ltd. 264 1,104
Anritsu Corp. 149,000 1,064
Bellsystem24, Inc. 4,900 1,045
Hitachi Software
Engineering Co., Ltd. 42,400 1,028
Ishihara Sangyo Kaisha Ltd. 467,000 1,014
* Fuji Television Network, Inc. 392 998
* Kanebo Ltd. 686,000 928
Ariake Japan Co., Ltd. 32,444 875
* Snow Brand Milk Products Co. 242,500 770
Amano Corp. 101,000 759
Capcom Co., Ltd. 73,100 755
Takuma Co., Ltd. 108,000 753
Kaken Pharmaceutical Co. 130,000 710
Saizeriya Co., Ltd. 49,050 657
--------------
2,888,182
--------------
NEW ZEALAND (0.7%)
Telecom Corp. of
New Zealand Ltd. 3,321,732 $ 11,760
Fletcher Building Ltd. 752,251 2,136
Carter Holt Harvey Ltd. 1,547,568 2,033
Sky City Entertainment
Group Ltd. 717,880 1,976
Contact Energy Ltd. 494,276 1,793
Auckland International
Airport Ltd. 404,815 1,719
Fisher & Paykel
Healthcare Corp. Ltd. 160,500 1,305
Fisher & Paykel
Appliances Holdings Ltd. 378,341 1,124
* Tower Ltd. 650,549 696
The Warehouse Group Ltd. 243,834 665
Independent Newspapers Ltd. 202,665 640
* Sky Network Television, Ltd. 150,668 518
NGC Holdings, Ltd. 213,591 339
* Tenon Ltd. Pfd. 234,309 284
* Tenon Ltd. 152,661 185
--------------
27,173
--------------
SINGAPORE (2.8%)
United Overseas Bank Ltd. 2,041,567 16,439
DBS Group Holdings Ltd. 1,911,161 16,063
Singapore
Telecommunications Ltd. 10,770,612 14,813
Oversea-Chinese
Banking Corp., Ltd. 1,662,510 11,823
Singapore Press Holdings Ltd. 631,455 7,794
Singapore Airlines Ltd. 961,962 6,106
Venture Corp. Ltd. 381,000 4,277
Keppel Corp., Ltd. 953,750 4,008
City Developments Ltd. 778,412 2,791
Singapore Technologies
Engineering Ltd. 2,304,407 2,560
Fraser & Neave Ltd. 294,900 2,305
Neptune Orient Lines Ltd. 1,924,000 2,204
ComfortDelgro Corp Ltd. 3,022,000 2,185
Capitaland Ltd. 1,790,300 1,694
* Chartered Semiconductor
Manufacturing Ltd. 1,736,000 1,530
SembCorp Industries Ltd. 1,570,419 1,320
Singapore Post Ltd. 2,366,000 1,154
Singapore Exchange Ltd. 1,177,000 1,128
Creative Technology Ltd. 89,150 933
Jardine Cycle & Carriage Ltd. 202,128 796
United Overseas Land Ltd. 582,500 613
Parkway Holdings Ltd. 846,640 592
Keppel Land Ltd. 576,000 542
Haw Par Brothers
International Ltd. 190,193 521
33
- --------------------------------------------------------------------------------
MARKET
VALUE*
PACIFIC STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
SembCorp Marine Ltd. 910,000 $ 516
SembCorp Logistics Ltd. 471,000 498
* ST Assembly Test Services Ltd. 552,000 496
Singapore Land Ltd. 221,000 488
Allgreen Properties Ltd. 746,000 432
* Datacraft Asia Ltd. 371,000 423
Wing Tai Holdings Ltd. 704,000 354
Overseas Union Enterprise Ltd. 92,000 333
SMRT Corp. Ltd. 876,000 322
--------------
108,053
--------------
- --------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(COST $3,794,809) 3,877,956
- --------------------------------------------------------------------------------
FACE
AMOUNT
(000)
- --------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS (10.7%) (1)
- --------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSN.
(2) 1.05%, 7/14/2004 $ 1,500 1,497
REPURCHASE AGREEMENT
Collateralized by U.S. Government
Obligations in a Pooled
Cash Account
1.04%, 5/3/2004--Note F 411,300 411,300
- --------------------------------------------------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS
(COST $412,797) 412,797
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS (110.8%)
(COST $4,207,606) 4,290,753
- --------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-10.8%)
Other Assets--Note B 23,789
Security Lending Collateral Payable
to Brokers--Note F (411,300)
Other Liabilities (29,690)
--------------
(417,201)
--------------
- --------------------------------------------------------------------------------
NET ASSETS (100%) $3,873,552
================================================================================
* A substantial number of the fund's holdings were valued using fair value
procedures at April 30, 2004. See Note A in Notes to Financial Statements.
* Non-income-producing security.
(1)The fund invests a portion of its cash reserves in equity markets through the
use of index futures contracts. After giving effect to futures investments, the
fund's effective common stock and temporary cash investment positions represent
100.4% and 10.4%, respectively, of net assets. See Note D in Notes to Financial
Statements.
(2)Security segregated as initial margin for open futures contracts.
- --------------------------------------------------------------------------------
AMOUNT
(000)
- --------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- --------------------------------------------------------------------------------
Paid-in Capital $3,950,435
Undistributed Net Investment Income 13,602
Accumulated Net Realized Losses (173,464)
Unrealized Appreciation (Depreciation)
Investment Securities 83,147
Futures Contracts 465
Foreign Currencies and
Forward Currency Contracts (633)
- --------------------------------------------------------------------------------
NET ASSETS $3,873,552
================================================================================
Investor Shares--Net Assets
Applicable to 354,378,932 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $2,993,126
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
INVESTOR SHARES $8.45
================================================================================
Admiral Shares--Net Assets
Applicable to 4,529,368 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $250,312
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
ADMIRAL SHARES $55.26
================================================================================
Institutional Shares--Net Assets
Applicable to 74,549,459 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $630,114
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
INSTITUTIONAL SHARES $8.45
================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
34
- --------------------------------------------------------------------------------
MARKET
EMERGING MARKETS VALUE*
STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
COMMON STOCKS (99.5%)(1)
- --------------------------------------------------------------------------------
ARGENTINA (0.7%)
* Petrobras Energia
Participaciones SA 2,907,160 $ 3,538
Tenaris SA 960,555 2,928
* Telecom Argentina
STET-France Telecom SA 1,423,185 2,421
Siderar SA Class A 293,067 1,552
Tenaris SA (Mexico) 450,275 1,303
* Transportadora de Gas Sur SA 978,955 872
* BBVA Banco Frances SA 320,570 750
Tenaris SA ADR 19,234 577
* Molinos Rio de la Plata SA 345,996 568
* Irsa Inversiones y
Representaciones SA 485,272 398
Solvay Indupa S.A.I.C. 365,938 379
* Petrobras Energia
Participaciones SA ADR 31,000 375
Cresud SA 209,663 260
--------------
15,921
--------------
BRAZIL (8.8%)
Petroleo Brasileiro SA Pfd. 1,331,589 33,125
Petroleo Brasileiro SA 967,362 27,540
Companhia Vale do
Rio Doce Pfd. Class A 468,915 18,457
Cia Vale do Rio Doce (CVRD) 332,300 14,943
Companhia de Bebidas das
Americas Pfd. 76,866,480 14,280
Banco Itau Holding
Financeira SA Pfd. 167,595,294 13,296
* Banco Bradesco SA 254,549 10,434
Tele Norte Leste
Participacoes SA Pfd. 846,154,975 10,021
Empresa Brasileira de
Aeronautica SA Pfd. 1,043,791 6,730
Companhia Siderurgica
Nacional SA 122,290,281 5,807
Unibanco-Uniao de Bancos
Brasileiros SA 139,423,468 5,396
Gerdau SA Pfd. 458,232 4,789
Companhia Energetica de
Minas Gerais Pfd. 307,852,323 4,701
Brasil Telecom
Participacoes SA Pfd. 756,330,850 4,609
* Aracruz Celulose SA Pfd.
B Shares 1,458,823 4,554
Centrais Electricas
Brasileiras SA 386,269,668 4,065
* Telesp Celular Participacoes
SA Pfd. 1,423,612,492 4,043
Votorantim Celulose e
Papel SA Pfd. 55,467,976 3,497
Usiminas-Usinas
Siderugicas de Minas
Gerais SA Pfd. Class A 348,581 $ 3,489
Centrais Electricas Brasileiras
SA Pfd. B Shares 230,871,176 2,570
Tele Centro Oeste Celular
Participacoes SA Pfd. 827,675,737 2,331
Souza Cruz SA 261,593 2,308
Embratel Participacoes
SA Pfd. 699,843,618 2,092
Tele Norte Leste
Participacoes SA 181,314,285 1,908
Companhia Brasileira de
Distribuicao Grupo Pao
de Acucar Pfd. 102,856,219 1,836
Sadia SA Pfd. 1,159,238 1,570
* Braskem SA Pfd. A 77,589,400 1,540
Companhia Siderurgica
de Tubarao 48,193,700 1,382
Companhia de Saneamento
Basico do Estado
de Sao Paulo 28,565,100 1,327
Companhia Paranaense de
Energia-COPEL 342,109,632 1,161
Telemig Celular
Participacoes SA Pfd. 736,035,347 1,111
Brasil Telecom
Participacoes SA 200,998,938 1,102
Tele Celular Sul
Participacoes SA Pfd. 753,227,500 1,066
Tele Nordeste Celular
Participacoes SA Pfd. 738,326,742 922
Companhia de Tecidos
Norte de Minas Pfd. 9,184,668 654
Duratex SA Pfd. 19,764,256 469
* Tele Celular Sul Participacoes
SA Rights Exp. 6/7/2004 15,382,722 0
--------------
219,125
--------------
CHILE (2.2%)
Empresas Copec SA 1,545,200 10,856
Empresas CMPC SA 338,459 6,372
* Enersis SA 43,022,870 5,255
Compania de
Telecomunicaciones
de Chile SA 1,761,700 5,007
Empresa Nacional de
Electricidad SA 11,006,300 4,895
Banco Santander Chile SA 164,319,400 3,936
S.A.C.I. Falabella, SA 1,632,700 2,972
Empresa Nacional de
Telecomunicaciones SA 318,000 1,869
35
- --------------------------------------------------------------------------------
MARKET
EMERGING MARKETS VALUE*
STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
Sociedad Quimica y
Minera de Chile SA 398,300 $ 1,431
Vina Concha y Toro SA 1,648,762 1,395
Banco de Chile 25,686,000 1,208
Distribucion y Servicio
D&S SA 1,152,500 1,178
Colburn SA 12,752,500 1,120
Embotelladora Andina
SA Pfd. Class B 566,710 1,113
Embotelladora Andina SA 537,923 1,065
Compania Acero del Pacifico
SA (CAP) 289,600 1,040
Compania Cervecerias
Unidas SA 227,730 964
Cristalerias de Chile 93,500 795
Masisa SA 1,582,971 667
Parque Arauco SA 1,204,800 522
Empresas Iansa SA 5,023,540 152
Enersis SA ADR 17,500 106
--------------
53,918
--------------
CHINA (8.5%)
China Mobile
(Hong Kong) Ltd. 16,671,000 44,030
PetroChina Co. Ltd. 53,647,400 23,385
China Petroleum &
Chemical Corp. 39,837,700 13,790
* China Life Insurance Co., Ltd. 22,735,000 12,388
CNOOC Ltd. 27,810,500 10,073
Huaneng Power
International, Inc. H Share 10,340,000 9,677
CITIC Pacific Ltd. 3,714,000 9,095
China Telecom Corp. Ltd. 27,132,000 8,088
Denway Motors Ltd. 14,300,000 6,829
Aluminum Corp. of China Ltd. 8,463,000 4,964
Cosco Pacific Ltd. 3,655,000 4,686
* Semiconductor
Manufacturing
International Corp. 18,509,000 4,438
China Merchants Holdings
International Co. Ltd. 3,656,000 4,312
Beijing Datang Power
Generation co. Ltd. 4,828,000 3,776
China Resources
Enterprise Ltd. 3,166,659 3,674
Legend Group Ltd. 11,366,000 3,497
Yanzhou Coal Mining Co.
Ltd. H Share 3,466,000 3,244
Zhejiang Expressway Co., Ltd. 4,846,000 3,029
Brilliance China Automotive
Holdings Ltd. 7,555,000 2,785
Sinopec Shanghai
Petrochemical Co. Ltd. 7,998,000 2,666
* China Shipping
Development Co. 4,380,000 $ 2,527
Shanghai Industrial
Holding Ltd. 1,305,000 2,443
China Overseas Land &
Investment Ltd. 10,772,000 1,795
* China Southern Airlines
Company Ltd. 4,048,000 1,726
Zhejiang Southeast Electric
Power Co., Ltd. 2,234,900 1,719
* Jiangsu Expressway Co.
Ltd. H Share 3,712,000 1,678
Sinotrans Ltd. 4,780,000 1,639
TCL International Holdings Ltd. 4,029,000 1,485
Huadian Power International
Corp. Ltd. 4,918,000 1,403
Guangdong Electric Power
Development Co., Ltd. 1,941,900 1,399
The Guangshen
Railway Co., Ltd. 4,746,000 1,354
China Travel International 6,596,000 1,260
Beijing Capital International
Airport Co., Ltd. 3,404,000 1,047
* China Eastern Airlines Corp. Ltd. 5,218,000 1,017
China Everbright Ltd. 2,334,000 935
Jiangxi Copper Co. Ltd. 2,409,000 934
COFCO International Ltd. 2,076,000 878
Sinopec Yizheng Chemical
Fibre Co., Ltd. 4,816,000 877
Fujian Zijin Mining
Industry Co., Ltd. 2,632,000 860
Beijing Enterprises
Holdings Ltd. 820,000 852
* Tsingtao Brewery Co., Ltd. 1,012,000 798
Travelsky Technology Ltd. 1,084,000 744
China Pharmaceutical
Group Ltd. 2,234,000 652
* AviChina Industry &
Technology Co., Ltd. 4,874,000 569
Qingling Motors Co. Ltd.
H Share 3,346,000 476
Shenzhen Investment Ltd. 3,497,000 430
Digital China Holdings Ltd. 1,136,100 324
China Resources Land 2,702,000 312
* Eastern Communications
Co. Ltd. 636,700 278
--------------
210,837
--------------
36
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
CZECH REPUBLIC (0.8%)
Cesky Telecom a.s. 544,183 $ 6,843
Komercni Banka a.s. 52,108 5,698
Ceske Energeticke Zavody a.s. 708,115 5,060
Philip Morris CR a.s. 3,202 2,074
* Unipetrol a.s. 255,002 761
--------------
20,436
--------------
HUNGARY (1.5%)
* OTP Bank Rt. 807,590 15,058
MOL Magyar Olaj-es Gazipari Rt. 237,854 8,978
Magyar Tavkozlesi Rt. 1,590,875 6,647
Richter Gedeon Rt. 47,239 4,805
* Raba Rt. 22,975 88
--------------
35,576
--------------
INDIA (6.7%)
Reliance Industries Ltd. 1,898,590 22,474
Infosys Technologies Ltd. 135,295 15,659
Oil and Natural Gas Corp. Ltd. 581,700 10,988
ICICI Bank Ltd. 1,349,840 9,568
Hindustan Lever Ltd. 2,656,380 8,434
Housing Development
Finance Corp. Ltd. 622,980 8,333
Tata Motors Ltd. 549,744 5,847
Ranbaxy Laboratories Ltd. 242,580 5,796
ITC Ltd. 238,110 5,759
Satyam Computer Services Ltd. 771,180 5,564
Gail India Ltd. 874,500 4,294
Larsen & Toubro Ltd. 329,400 4,202
HDFC Bank Ltd. 486,970 4,116
Wipro Ltd. 104,480 3,629
State Bank of India 249,424 3,604
Grasim Industries Ltd. 115,670 3,216
Hindalco Industries Ltd. 127,800 3,203
Dr. Reddy's Laboratories Ltd. 156,850 3,067
Hero Honda Motors Ltd. 272,750 2,961
* Maruti Udyog Ltd. 239,800 2,934
Hindustan Petroleum
Corporation Ltd. 280,000 2,899
Tata Iron and Steel
Company Ltd. 303,660 2,443
Bharat Heavy Electricals Ltd. 169,360 2,233
Mahanagar Telephone
Nigam Ltd. 652,250 2,174
Bharat Petroleum Corp. Ltd. 204,280 2,160
Bajaj Auto Ltd. 100,220 2,075
Zee Telefilms Ltd. 585,950 1,681
I-Flex Solutions Ltd. 130,900 1,558
Gujarat Ambuja Cements Ltd. 207,870 1,555
Cipla Ltd. 49,650 1,528
Tata Power Co. Ltd. 178,340 1,524
Mahindra & Mahindra Ltd. 142,270 $ 1,502
Sun Pharmaceutical
Industries Ltd. 83,930 1,417
Nestle India Ltd. 78,580 1,140
Bank of Baroda 199,650 1,015
GlaxoSmithKline
Pharmaceuticals (India) Ltd. 65,500 983
Videsh Sanchar Nigam Ltd. 210,500 775
Tata Tea Ltd. 84,200 721
Asian Paints (India) Ltd. 100,775 699
ABB (India) Ltd. 36,470 643
Associated Cement
Companies Ltd. 100,900 635
Indian Hotels Co. Ltd. 60,970 540
Castrol (India) Ltd. 101,980 415
Punjab Tractors Ltd. 71,920 374
Colgate-Palmolive (India) Ltd. 111,100 320
GTL Ltd. 162,272 268
Britannia Industries Ltd. 19,600 265
GlaxoSmithKline Consumer
Healthcare Ltd. 37,935 215
--------------
167,405
--------------
INDONESIA (2.0%)
PT Telekomunikasi
Indonesia Tbk 17,138,584 15,710
PT Hanjaya Mandala
Sampoerna Tbk 9,928,700 5,766
PT Astra International Tbk 7,523,400 4,883
PT Central Bank Asia Tbk 8,328,380 3,699
PT Indonesian Satellite
Corp. Tbk 7,835,500 3,547
* PT Bank Rakyat Indonesia 15,869,500 3,117
PT Gudang Garam Tbk 1,636,600 2,721
PT Bank Mandiri 13,826,200 2,283
PT Bank Danamon 5,071,700 1,891
PT Indofood Sukses
Makmur Tbk 14,081,452 1,203
PT Ramayana Lestari
Sentosa Tbk 1,659,460 1,011
PT Bank Indonesia Tbk 23,637,740 969
* PT Perusahaan Gas Negara 5,048,000 747
PT Kalbe Farma 13,045,696 683
PT Semen Gresik Tbk 491,732 552
PT Bimantara Citra Tbk 1,356,752 525
PT Tempo Scan Pacific Tbk 524,956 427
PT Astra Agro Lestari Tbk 1,496,680 392
PT Aneka Tambang Tbk 2,346,815 321
PT Matahari Putra Prima Tbk 3,813,816 282
PT Bhakti Investama Tbk 4,696,500 182
--------------
50,911
--------------
37
- --------------------------------------------------------------------------------
MARKET
EMERGING MARKETS VALUE*
STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
ISRAEL (4.7%)
Teva Pharmaceutical
Industries Ltd. 979,390 $ 63,920
* Check Point Software
Technologies Ltd. 628,090 14,716
Bank Hapoalim Ltd. 2,544,563 6,565
Bank Leumi Le-Israel 1,929,009 3,523
* Bezeq Israeli
Telecommunication
Corp., Ltd. 2,817,690 2,953
Israel Chemicals Ltd. 1,602,667 2,689
Makhteshim-Agan Industries Ltd. 549,546 2,224
* Orbotech Ltd. 102,075 2,156
* M-Systems Flash Disk
Pioneers Ltd. 111,625 1,948
IDB Development Corp. Ltd. 76,052 1,669
* Koor Industries Ltd. 32,556 1,276
* Israel Discount Bank Ltd. 1,146,736 1,203
Elbit Systems Ltd. 63,304 1,170
Discount Investment Corp. Ltd. 48,333 1,136
United Mizrahi Bank Ltd. 347,396 1,103
* NICE Systems Ltd. 44,800 1,069
* ECI Telecom Ltd. 187,465 1,050
CLAL Industries Ltd. 205,666 973
Migdal Insurance Holdings Ltd. 721,928 936
* Audiocodes Ltd. 98,000 919
The Israel Corp. Ltd.-ILS 1 Par 4,751 715
Super Sol Ltd. 299,987 705
CLAL Insurance Enterprise
Holdings Ltd. 45,097 696
Elite Industries Ltd. -ILS 1 Par 80,129 679
* Matav-Cable Systems Media Ltd. 37,875 374
Blue Square-Israel Ltd. 29,420 325
--------------
116,692
--------------
MEXICO (7.5%)
America Movil SA de
CV Series L 19,794,798 33,640
Telefonos de Mexico
SA Series L 18,075,959 30,878
Cemex SA CPO 4,062,432 23,725
Wal-Mart de Mexico SA 6,013,932 17,588
Grupo Televisa SA CPO 7,202,522 15,708
America Movil SA de
CV Series A 5,555,377 9,646
Telefonos de Mexico SA
Series A 5,555,377 9,568
Fomento Economico
Mexicano UBD 2,169,454 9,466
Grupo Modelo SA 1,777,781 4,474
Kimberly Clark de Mexico
SA de CV Series A 1,671,732 4,434
Grupo Carso SA de CV Series A1 856,296 $ 3,206
* Grupo Mexico SA de CV 879,619 2,597
Alfa SA de CV Series A 787,531 2,590
TV Azteca SA CPO 4,220,500 2,369
Grupo Financerio Banorte
SA de CV 614,900 2,178
Grupo Elektra SA 329,188 1,934
* Coca-Cola Femsa SA de CV 917,722 1,931
* Corporacion Interamericana de
Entretenimiento SA de CV 826,593 1,703
Grupo Bimbo SA 811,909 1,638
Grupo Aeroportuario del
Sureste SA de CV 747,000 1,457
Industrias Penoles SA Series CP 328,739 1,441
Controladora Comercial
Mexicana SA de CV (Units) 1,067,071 1,179
* Consorcio ARA SA de CV 427,100 1,172
Grupo Continental SA 497,622 869
Vitro SA 565,560 610
--------------
186,001
--------------
PERU (0.6%)
Compania de Minas
Buenaventura S.A.u 291,233 6,478
Credicorp Ltd. 193,025 2,442
Minsur SA 658,315 1,621
Southern Peru Copper Corp. 46,950 1,380
Edegel SA 2,353,228 919
Union de Cervecerias Backus y
Johnston SAA 1,835,832 453
Luz del Sur SAA 351,123 420
Compania de Minas
Buenaventura SAA ADR 12,400 268
--------------
13,981
--------------
PHILIPPINES (0.6%)
* Philippine Long Distance
Telephone Co. 142,696 2,752
Bank of Philippine Islands 2,214,100 1,918
Globe Telecom, Inc. 101,000 1,533
Ayala Land, Inc. 14,603,671 1,486
Ayala Corp. 14,461,080 1,472
San Miguel Corp. Class B 1,053,013 1,401
SM Prime Holdings, Inc. 9,848,320 1,090
Metropolitan Bank & Trust Co. 1,791,085 800
* Manila Electric Co. 1,080,393 588
* Equitable PCI Bank, Inc. 738,000 514
* ABS-CBN Broadcasting Corp. 870,200 373
Petron Corp. 5,760,746 334
Jollibee Foods Corp. 886,200 324
* Filinvest Land, Inc. 13,905,518 263
* Megaworld Corp. 10,989,000 220
--------------
15,068
--------------
38
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
POLAND (1.5%)
Telekomunikacja Polska SA 2,366,008 $ 9,597
Polski Koncern Naftowy SA 1,008,934 7,231
Bank Polska Kasa Opieki
Grupa Pekao SA 226,397 7,042
Bank Przemyslowo
Handlowy PBK SA 29,509 3,231
* KGHM Polska Miedz SA 378,419 2,618
* Prokom Software SA 28,278 1,429
* Bank Zachodni WBK SA 63,100 1,413
* Agora SA 78,716 936
Grupa Kety SA 27,200 890
* Bank Rozwoju Eksportu SA 27,700 789
Frantschach Swiecei SA 41,634 683
Orbis SA 82,950 510
* Computerland SA 16,654 448
* Budimex SA 33,300 406
Przedsiebiorstwo
Farmaceutyczne JELFA SA 15,491 276
* Softbank SA 38,790 239
--------------
37,738
--------------
SOUTH AFRICA (14.6%)
Anglo American PLC 4,748,569 94,886
Sasol Ltd. 1,928,373 28,941
Standard Bank Group Ltd. 3,637,774 20,986
Old Mutual PLC 11,688,952 20,047
* MTN Group Ltd. 3,649,478 15,267
Impala Platinum Holdings Ltd. 214,229 14,582
Firstrand Ltd. 10,214,524 14,097
Gold Fields Ltd. 1,324,004 13,371
Anglogold Ltd. 378,364 12,021
Sanlam Ltd. 8,921,390 11,235
Sappi Ltd. 732,475 9,882
Harmony Gold Mining Co., Ltd. 746,300 8,266
Anglo American Platinum Corp. 218,374 7,534
Barloworld Ltd. 698,715 7,011
Tiger Brands Ltd. 564,490 6,979
Bidvest Group Ltd. 848,172 6,621
Telkom South Africa Ltd. 564,400 6,125
Naspers Ltd. 852,360 5,759
Nedcor Ltd. 660,559 5,680
Imperial Holdings Ltd. 551,194 5,230
Nampak Ltd. 1,946,133 3,987
Steinhoff International
Holdings Ltd. 2,890,200 3,594
Liberty Group Ltd. 462,906 3,527
Iscor Ltd. 677,465 3,243
Woolworths Holdings Ltd. 2,978,546 3,062
Anglovaal Industries Ltd. 1,144,100 3,010
* Dimension Data Holdings PLC 4,312,505 2,796
Network Healthcare
Holdings Ltd. 3,868,300 2,753
JD Group Ltd. 424,872 $ 2,516
African Bank Investments Ltd. 1,609,807 2,453
Truworths International Ltd. 1,636,097 2,352
Foschini Ltd. 748,110 2,147
Investec Ltd. 114,054 2,017
Pick'n Pay Stores Ltd. 734,382 1,881
Metropolitan Holdings Ltd. 1,708,425 1,830
Metro Cash & Carry Ltd. 5,484,215 1,829
Shoprite Holdings Ltd. 1,294,357 1,805
Alexander Forbes Ltd. 986,800 1,429
Tongaat-Hulett Group Ltd. 169,245 1,100
Nedcor Ltd. Rights Exp.
5/3/2004 188,145 403
--------------
362,254
--------------
SOUTH KOREA (20.2%)
Samsung Electronics Co., Ltd. 388,560 184,453
Kookmin Bank 934,209 34,873
Posco 167,400 20,473
Samsung Electronics Co.,
Ltd. Pfd. 68,620 18,948
Hyundai Motor Co. Ltd. 472,510 18,021
LG Electronics Inc. 279,731 16,974
SK Telecom Co., Ltd. 99,580 16,974
Samsung SDI Co. Ltd. 114,620 14,653
KT Corp. 394,490 13,751
Korea Electric Power Corp. 787,790 12,891
Shinhan Financial Group Ltd. 591,890 10,316
Hyundai Mobis 183,100 7,865
Samsung Fire & Marine
Insurance Co. 113,160 7,522
Shinsegae Co. Ltd. 32,214 7,276
KT & G Corp. 275,710 7,002
Samsung Electro-Mechanics Co. 184,400 6,946
Posco ADR 207,000 6,365
LG Chem Ltd. 138,832 5,608
S-Oil Corp. 139,030 5,545
Samsung Corp. 454,580 5,424
Kia Motors 501,940 4,663
Hana Bank 183,958 3,974
Kangwon Land Inc. 327,908 3,731
Samsung Securities Co. Ltd. 166,670 3,445
Samsung Electronics Co.,
Ltd. GDR 14,000 3,323
Hyundai Heavy
Industries Co., Inc. 140,230 3,245
Daelim Industrial Co. 85,110 3,163
CJ Corp. 51,570 3,059
Daewoo Shipbuilding & Marine
Engineering Co., Ltd. 295,350 3,021
LG Investment &
Securities Co. Ltd. 286,750 2,468
NCsoft Corp. 34,395 2,462
39
- --------------------------------------------------------------------------------
MARKET
EMERGING MARKETS VALUE*
STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
Hankook Tire Co. Ltd. 298,060 $ 2,418
Samsung Heavy
Industries Co. Ltd. 541,810 2,405
Amorepacific Corporation 14,470 2,312
Cheil Industrial, Inc. 137,470 1,998
* Korea Exchange Bank 373,030 1,958
Hite Brewery Co., Ltd. 26,390 1,934
Nong Shim Co. Ltd. 9,834 1,890
LG Engineering &
Construction Co., Ltd. 111,140 1,890
* Daishin Securities Co. 128,450 1,741
* Hyundai Securities Co. 368,099 1,703
Hanjin Shipping Co., Ltd. 120,920 1,700
Kumkang Korea
Chemical Co., Ltd. 16,330 1,670
Honam Petrochemical Corp. 44,680 1,664
LG Petrochemical Co., Ltd. 82,190 1,650
S1 Corp. 64,870 1,576
* Korean Air Co. Ltd. 111,898 1,526
Cheil Communications Inc. 10,560 1,476
* Daum Communications Corp. 32,858 1,414
Hyundai Department
Store Co., Ltd. 44,508 1,202
Dae Duck Electronics Co. 114,773 1,169
Yuhan Corp. 18,831 1,138
* Daewoo Securities Co., Ltd. 292,630 1,095
LG Household & Health Care Ltd. 34,932 1,051
LG Cable Ltd. 65,770 936
Samsung Fine Chemicals Co., Ltd. 50,230 730
Hyosung Corp. 78,503 672
Poongsan Corp. 70,500 640
* Shinhan Good Morning
Securities Co., Ltd. 184,338 621
Donqwon Financial
Holding Co. Ltd. 102,903 570
Humax Co., Ltd. 68,696 509
--------------
501,692
--------------
TAIWAN (13.7%)
Taiwan Semiconductor
Manufacturing Co., Ltd. 27,460,944 47,532
United Microelectronics Corp. 27,319,794 24,507
Hon Hai Precision
Industry Co., Ltd. 3,617,118 14,264
AU Optronics Corp. 6,650,500 13,613
Nan Ya Plastic Corp. 8,919,199 11,975
China Steel Corp. 12,866,070 11,464
Cathay Financial Holding Co. 6,042,980 10,733
MediaTek Incorporation 983,050 9,381
Formosa Plastic Corp. 6,543,816 9,357
Mega Financial
Holding Co. Ltd. 13,654,224 9,166
Chinatrust Financial Holding 8,416,332 $ 9,045
China Development
Financial Holding Corp. 15,376,684 8,424
Formosa Chemicals &
Fibre Corp. 5,360,624 7,746
Asustek Computer Inc. 3,482,175 7,442
Fubon Financial
Holding Co., Ltd. 7,007,100 6,686
Quanta Computer Inc. 2,800,580 5,901
Chunghwa Telecom Co., Ltd. 3,621,000 5,832
Compal Electronics Inc. 4,775,710 5,377
Acer Inc. 3,564,304 5,043
* First Financial Holding Co., Ltd. 6,616,000 4,840
Taishin Financial Holdings 4,991,000 4,372
* Chunghwa Picture Tubes, Ltd. 7,121,229 4,588
* Hau Nan Financial
Holdings Co., Ltd. 4,789,532 4,181
Advanced Semiconductor
Engineering Inc. 4,891,530 4,064
BENQ Corp. 2,675,968 3,746
* Chang Hwa Commercial Bank 6,516,094 3,727
Taiwan Cellular Corp. 3,963,360 3,639
* Winbond Electronics Corp. 6,722,000 3,541
* CMC Magnetics Corp. 3,993,700 3,318
Lite-On Technology Corp. 3,036,909 3,200
* Macronix International Co., Ltd. 7,947,700 3,134
SinoPac Holdings 5,722,491 2,980
* Tatung Co., Ltd. 7,099,000 2,778
* Walsin Lihwa Corp. 5,719,000 2,617
Uni-President Enterprises Co. 5,766,590 2,508
* Yageo Corp. 4,259,520 2,321
Delta Electronics Inc. 1,774,177 2,184
Far Eastern Textile Ltd. 3,621,627 2,180
Pou Chen Corp. 2,225,542 2,123
* Ritek Corp. 3,160,500 2,007
International Bank of Taipei 3,217,651 1,957
* Siliconware Precision
Industries Co. 2,215,300 1,947
Inventec Co., Ltd. 3,034,830 1,900
President Chain Store Corp. 1,021,562 1,814
Yulon Motor Co., Ltd. 1,563,040 1,797
Via Technologies Inc. 1,568,046 1,784
China Motor Co., Ltd. 1,125,826 1,779
Largan Precision Co., Ltd. 143,400 1,606
Yang Ming Marine Transport 1,890,000 1,582
Synnex Technology
International Corp. 978,880 1,518
Gigabyte Technology Co., Ltd. 810,400 1,488
Taiwan Glass Industrial Corp. 1,709,990 1,462
Realtek Semiconductor Corp. 978,680 1,332
Micro-Star
International Co., Ltd. 928,541 1,275
40
- --------------------------------------------------------------------------------
MARKET
VALUE*
SHARES (000)
- --------------------------------------------------------------------------------
Cheng Shin Rubber
Industry Co., Ltd. 988,771 $ 1,152
Taiwan Cement Corp. 2,628,701 1,128
Teco Electric &
Machinery Co., Ltd 3,019,000 1,127
Evergreen Marine Corp. 1,455,344 1,117
Asia Cement Corp. 2,144,000 1,117
D-Link Corp. 824,800 1,110
Premier Image Technology Corp. 690,500 1,102
Zyxel Communications Corp. 486,000 1,061
Advantech Co., Ltd. 462,199 974
Wan Hai Lines Ltd. 1,053,684 882
* Prodisc Technology Inc. 1,005,730 878
Kinpo Electronics, Inc. 1,626,616 862
Formosa Taffeta Co., Ltd. 1,959,529 846
Oriental Union Chemical Corp. 807,920 841
Phoenixtec Power Co., Ltd. 761,430 808
Cathay Construction Corp. 1,753,779 797
Accton Technology Corp. 1,103,116 797
Nien Hsing Textile Co. Ltd. 803,000 776
Taiwan Styrene Monomer Corp. 1,021,800 738
* Sampo Corp. 2,030,000 721
EVA Airways Corp. 1,729,099 705
Systex Corp. 1,463,620 701
* Compeq Manufacturing Co., Ltd. 1,521,750 653
China Airlines 1,188,269 608
Nien Made Enterprise Co., Ltd. 342,000 592
* Arima Computer Corp. 1,738,100 578
Eternal Chemical Co., Ltd. 859,100 528
Giant Manufacturing Co., Ltd. 411,270 503
* Picvue Electronics, Ltd. 1,324,150 498
Shihlin Electric &
Engineering Corp. 788,000 491
Elitegroup Computer
System Co., Ltd. 670,900 489
Taiwan Secom Corp., Ltd. 501,248 465
Continental Engineering Corp. 912,256 464
* Wus Printed Circuit Co., Ltd. 738,000 460
BES Engineering Corp. 2,349,468 431
--------------
341,777
--------------
THAILAND (3.2%)
PTT Public Co., Ltd. (Foreign) 2,845,200 10,382
* Bangkok Bank PLC (Foreign) 3,701,134 9,066
Advanced Information
Services Co. Ltd. (Foreign) 2,967,440 6,527
PTT Exploration &
Production PLC (Foreign) 878,636 5,929
* Kasikornbank
Public Co. Ltd. (Foreign) 4,552,100 5,518
Siam Cement PLC (Foreign) 1,012,740 5,467
Shin Corp. Public Co. Ltd. 3,465,500 3,053
Krung Thai Bank Public Co. Ltd. 9,386,200 $ 2,510
Thai Airways International
Public Co. Ltd. (Foreign) 1,695,700 2,415
Siam Commercial Bank
PLC (Foreign) 1,904,491 2,202
Siam Cement PLC (Local) 409,290 2,148
Land and Houses Public Co. Ltd. 7,111,700 1,973
* Airports of Thailand
Public Co. Ltd. 1,465,900 1,924
BEC World Public Co. Ltd.
(Foreign) 3,010,830 1,385
Banpu PLC (Foreign) 398,600 1,295
Hana Microelectronics
Public Co. Ltd. (Foreign) 366,600 1,228
* Sahaviriya Steel Industries
(Foreign) 1,781,900 1,158
Siam City Cement PLC
(Foreign) 215,606 1,153
Siam Commercial Bank Cvt. Pfd. 910,644 1,041
TISCO Finance Public Co. Ltd.
(Foreign) 1,376,900 1,015
National Finance & Securities
PLC (Foreign) 2,241,130 919
Ratchaburi Electricity
Generating Holding Public Co.
Ltd. (Foreign) 952,000 892
* Thai Olefins Public Co. Ltd. 650,600 829
Land and Houses Public Co. Ltd. 3,165,100 815
Delta Electronics (Thailand)
Public Co. Ltd. (Foreign) 1,153,750 743
Charoen Pokphand Foods
Public Co., Ltd. (Foreign) 7,812,212 719
* Bangkok Bank Public Co. Ltd. 291,200 688
Bangkok Expressway
PLC (Foreign) 1,181,800 650
* True Corp. PCL (Foreign) 3,687,388 604
Kiatnakin Finance
Public Co. Ltd. (Foreign) 593,100 586
Thai Union Frozen Products
Public Co., Ltd. (Foreign) 868,500 512
National Petrochemical
PLC (Foreign) 236,316 511
C.P. 7-Eleven Public Co. Ltd. 350,200 495
Kim Eng Securities Thailand
Public Co. Ltd. 378,400 468
Electricity Generating
PLC (Foreign) 259,048 453
Electricity Generating
Public Co. Ltd. 224,800 379
Siam Makro Public Co.
Ltd. (Foreign) 223,900 257
41
- --------------------------------------------------------------------------------
MARKET
EMERGING MARKETS VALUE*
STOCK INDEX FUND SHARES (000)
- --------------------------------------------------------------------------------
GMM Grammy Public Co.
Ltd. (Foreign) 712,800 $ 249
* United Broadcasting Corp.
PLC (Foreign) 505,296 239
Siam Cement PLC Non-Voting
Depository Receipts 42,200 221
* Bangkok Bank PLC (Local) 87,200 206
* Industrial Finance Corp. of
Thailand PLC (Foreign) 1,821,208 194
* Kasikornbank Public Co., Ltd. 99,700 121
Advanced Info Service
Public Co. Ltd. 34,000 75
Banpu Public Co., Ltd.
Non-Voting Depository
Receipts 19,600 61
Electricity Generating Public Co.
Ltd. Non-Voting Depository
Receipts 30,600 52
Land and Houses Public Co. Ltd.
Non-Voting Depository
Receipts 199,000 51
* Kasikornbank Public Co., Ltd.
Non-Voting Depository
Receipts 38,600 47
Thai Union Frozen Products
Public Co., Ltd. Non-Voting
Depository Receipts 80,800 46
--------------
79,471
--------------
TURKEY (1.8%)
Akbank TAS 1,226,044,059 5,705
Turkiye Is Bankasi
A.S. C Shares 1,445,453,262 5,171
* Turkiye Garanti
Bankasi A.S. 985,896,371 3,023
Anadolu Efes Biracilik ve
Malt Sanayii A.S. 191,445,336 2,686
* Haci Omer Sabanci
Holding A.S. 810,295,515 2,642
* Turkcell Iletisim
Hizmetleri A.S. 239,097,700 2,596
* KOC Holding A.S. 539,108,463 $ 2,489
* Yapi ve Kredi Bankasi A.S. 1,160,221,198 2,474
* Eregli Demir ve Celik
Fabrikalari A.S. 75,040,371 2,129
Tupras-Turkiye Petrol
Rafinerileri A.S. 296,271,916 1,880
* Ford Otomotiv Sanayi A.S. 200,440,840 1,583
Arcelik A.S. 264,592,080 1,418
Dogan Yayin Holding A.S. 356,214,654 1,187
Migros Turk A.S. 236,197,485 1,182
* Vestel Elektronik
Sanayi ve Ticaret A.S. 279,178,607 915
* Tofas Turk Otomobil
Fabrikasi A.S. 393,875,756 889
* Turk Sise ve Cam
Fabrikalari A.S. 319,376,289 822
* Hurriyet Azteccilik ve
Matbaacillik A.S. 281,921,141 800
Trakya Cam Sanayii A.S. 269,651,624 623
* Haci Omer Sabanci
Holding A.S. 162,059,101 508
Aksigorta A.S. 182,960,751 497
Alarko Holdings A.S. 16,775,852 417
* Tansas Perakende
Magazacilik Ticaret A.S. 351,819,696 367
Cimsa Cemento Sanayi ve
Ticaret A.S. 171,021,588 365
* Aygaz A.S. 144,218,759 343
Aksa Akrilik Kimya
Sanayii A.S. 33,489,472 300
* Is Gayrimenkul Yatirim
Ortakligi A.S. 259,743,075 278
Akcansa Cimento A.S. 99,581,107 260
Ak Enerji Elektrik Uretimi
Otoproduktor Gruba A.S. 53,378,685 254
Adana Cimento Sanayii T.A.S. 45,612,370 158
Nortel Networks 6,657,324 145
--------------
44,106
--------------
- --------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(COST $2,248,290) 2,472,909
- --------------------------------------------------------------------------------
42
- --------------------------------------------------------------------------------
FACE MARKET
AMOUNT VALUEO
(000) (000)
- --------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENT (0.2%)(1)
- --------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSN.
(2) 1.01%, 7/7/2004
(COST $3,992) $4,000 $ 3,992
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS (99.7%)
(COST $2,252,282) 2,476,901
- --------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.3%)
- --------------------------------------------------------------------------------
Other Assets--Note B 20,721
Liabilities (12,613)
--------------
8,108
--------------
NET ASSETS (100%) $2,485,009
================================================================================
* See Note A in Notes to Financial Statements.
(1)The fund invests a portion of its cash reserves in equity markets through the
use of equity swap contracts. Investments in swap contracts increased the fund's
equity investments in South Korea and Taiwan to 20.4% and 14.2%, respectively.
After giving effect to swap investments, the fund's effective common stock and
temporary cash investment positions represent 100.2% and -0.5%, respectively, of
net assets. See Note D in Notes to Financial Statements.
(2)Security segregated in connection with open swap contracts.
*Non-income-producing security.
ADR--American Depositary Receipt.
GDR--Global Depository Receipt.
ILS--Israeli Shekel.
- --------------------------------------------------------------------------------
AMOUNT
(000)
- --------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- --------------------------------------------------------------------------------
Paid-in Capital $2,389,932
Undistributed Net Investment Income 17,149
Accumulated Net Realized Losses (150,559)
Unrealized Appreciation (Depreciation)
Investment Securities 224,619
Foreign Currencies (128)
Swap Contracts 3,996
- --------------------------------------------------------------------------------
NET ASSETS $2,485,009
================================================================================
Investor Shares--Net Assets
Applicable to 191,774,482 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $2,257,600
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
INVESTOR SHARES $11.77
================================================================================
Institutional Shares--Net Assets
Applicable to 19,297,844 outstanding $.001
par value shares of beneficial interest
(unlimited authorization) $227,409
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--
INSTITUTIONAL SHARES $11.78
================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
43
- -----------------------------------------------------------------------------------------------
MARKET
VALUE*
TOTAL INTERNATIONAL STOCK INDEX FUND SHARES (000)
- -----------------------------------------------------------------------------------------------
INVESTMENT COMPANIES (100.0%)
- -----------------------------------------------------------------------------------------------
Vanguard European Stock Index Fund Investor Shares 174,242,030 $3,833,324
Vanguard Pacific Stock Index Fund Investor Shares 196,071,750 1,656,806
Vanguard Emerging Markets Stock Index Fund Investor Shares 52,448,899 617,324
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENT COMPANIES
(COST $5,878,367) 6,107,454
- -----------------------------------------------------------------------------------------------
FACE
AMOUNT
(000)
- -----------------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENT (0.1%)
- -----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT
Collateralized by U.S. Government Obligations
in a Pooled Cash Account
1.04%, 5/3/2004
(COST $9,370) $9,370 9,370
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (100.1%)
(COST $5,887,737) 6,116,824
- -----------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-0.1%)
- -----------------------------------------------------------------------------------------------
Other Assets 14,510
Liabilities (22,501)
----------
(7,991)
----------
- -----------------------------------------------------------------------------------------------
NET ASSETS (100%)
- -----------------------------------------------------------------------------------------------
Applicable to 566,832,487 outstanding $.001 par value shares of
beneficial interest (unlimited authorization) $6,108,833
===============================================================================================
NET ASSET VALUE PER SHARE $10.78
===============================================================================================
*See Note A in Notes to Financial Statements.
- -----------------------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- -----------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- -----------------------------------------------------------------------------------------------
Paid-in Capital $5,929,813 $10.47
Undistributed Net Investment Income 1,187 --
Accumulated Net Realized Losses (51,254) (.09)
Unrealized Appreciation 229,087 .40
- -----------------------------------------------------------------------------------------------
NET ASSETS $6,108,833 $10.78
===============================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
44
- -----------------------------------------------------------------------------------------------
MARKET
VALUE*
DEVELOPED MARKETS INDEX FUND SHARES (000)
- -----------------------------------------------------------------------------------------------
INVESTMENT COMPANIES (99.9%)
- -----------------------------------------------------------------------------------------------
Vanguard European Stock Index Fund Investor Shares 27,291,273 $600,408
Vanguard Pacific Stock Index Fund Investor Shares 30,709,988 259,499
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENT COMPANIES
(COST $773,453) 859,907
- -----------------------------------------------------------------------------------------------
FACE
AMOUNT
(000)
- -----------------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENT
- -----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT
Collateralized by U.S. Government Obligations
in a Pooled Cash Account
1.04%, 5/3/2004
(COST $143) $143 143
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (99.9%)
(COST $773,596) 860,050
- -----------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.1%)
- -----------------------------------------------------------------------------------------------
Other Assets 1,531
Liabilities (994)
--------
537
--------
- -----------------------------------------------------------------------------------------------
NET ASSETS (100%)
- -----------------------------------------------------------------------------------------------
Applicable to 108,502,307 outstanding $.001 par value shares of
beneficial interest (unlimited authorization) $860,587
===============================================================================================
NET ASSET VALUE PER SHARE $7.93
===============================================================================================
*See Note A in Notes to Financial Statements.
- -----------------------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- -----------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- -----------------------------------------------------------------------------------------------
Paid-in Capital $775,734 $7.15
Undistributed Net Investment Income 151 --
Accumulated Net Realized Losses (1,752) (.02)
Unrealized Appreciation 86,454 .80
- -----------------------------------------------------------------------------------------------
NET ASSETS $860,587 $7.93
===============================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
45
- -----------------------------------------------------------------------------------------------
MARKET
VALUE*
INSTITUTIONAL DEVELOPED MARKETS INDEX FUND SHARES (000)
- -----------------------------------------------------------------------------------------------
INVESTMENT COMPANIES (99.9%)
- -----------------------------------------------------------------------------------------------
Vanguard European Stock Index Fund Institutional Shares 22,546,099 $496,465
Vanguard Pacific Stock Index Fund Institutional Shares 25,370,134 214,377
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENT COMPANIES
(COST $637,246) 710,842
- -----------------------------------------------------------------------------------------------
FACE
AMOUNT
(000)
- -----------------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENT
- -----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT
Collateralized by U.S. Government Obligations
in a Pooled Cash Account
1.04%, 5/3/2004
(COST $66) $66 66
- -----------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (99.9%)
(COST $637,312) 710,908
- -----------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.1%)
- -----------------------------------------------------------------------------------------------
Other Assets 635
Liabilities (217)
--------
418
--------
- -----------------------------------------------------------------------------------------------
NET ASSETS (100%)
- -----------------------------------------------------------------------------------------------
Applicable to 90,527,785 outstanding $.001 par value shares of
beneficial interest (unlimited authorization) $711,326
===============================================================================================
NET ASSET VALUE PER SHARE $7.86
===============================================================================================
*See Note A in Notes to Financial Statements.
- -----------------------------------------------------------------------------------------------
AT APRIL 30, 2004, NET ASSETS CONSISTED OF:
- -----------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- -----------------------------------------------------------------------------------------------
Paid-in Capital $647,589 $7.16
Undistributed Net Investment Income 119 --
Accumulated Net Realized Losses (9,978) (0.11)
Unrealized Appreciation 73,596 0.81
- -----------------------------------------------------------------------------------------------
NET ASSETS $711,326 $7.86
===============================================================================================
See Note D in Notes to Financial Statements for the tax-basis components of net
assets.
46
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. The Total International
Stock, Developed Markets, and Institutional Developed Markets Index Funds'
Income Distributions Received from the other funds' net income have been reduced
by their share of the other funds' expenses. 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.
- ----------------------------------------------------------------------------------------------------------------
EUROPEAN PACIFIC EMERGING
STOCK INDEX STOCK INDEX MARKETS STOCK
FUND FUND INDEX FUND
---------------------------------------------
SIX MONTHS ENDED APRIL 30, 2004
- ----------------------------------------------------------------------------------------------------------------
(000) (000) (000)
- ----------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME
Dividends* $105,210 $32,309 $ 27,543
Interest 133 158 108
Security Lending 1,636 567 4
- ----------------------------------------------------------------------------------------------------------------
Total Income 106,979 33,034 27,655
- ----------------------------------------------------------------------------------------------------------------
EXPENSES
The Vanguard Group--Note B
Investment Advisory Services 57 57 57
Management and Administrative--Investor Shares 6,930 3,578 2,552
Management and Administrative--Admiral Shares 321 226 --
Management and Administrative--Institutional Shares 194 225 85
Marketing and Distribution--Investor Shares 434 187 124
Marketing and Distribution--Admiral Shares 29 14 --
Marketing and Distribution--Institutional Shares 69 35 15
Custodian Fees 2,008 891 2,659
Shareholders' Reports--Investor Shares 41 16 16
Shareholders' Reports--Admiral Shares -- -- --
Shareholders' Reports--Institutional Shares -- -- --
Trustees' Fees and Expenses 4 2 1
- ----------------------------------------------------------------------------------------------------------------
Total Expenses 10,087 5,231 5,509
- ----------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 96,892 27,803 22,146
- ----------------------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS)
Investment Securities Sold 2,372 2,021 25,423
Futures Contracts 1,551 3,330 --
Foreign Currencies and Forward Currency Contracts 2,291 1,995 (533)
Swap Contracts -- -- 1,967
- ----------------------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS) 6,214 7,346 26,857
- ----------------------------------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION)
Investment Securities 725,406 246,622 68,000
Futures Contracts 667 311 --
Foreign Currencies and Forward Currency Contracts (1,827) (2,569) (135)
Swap Contracts -- -- (2,135)
- ----------------------------------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) 724,246 244,364 65,730
- ----------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $827,352 $279,513 $114,733
- ----------------------------------------------------------------------------------------------------------------
*Dividends are net of foreign withholding taxes of $14,294,000, $1,637,000, and
$3,376,000, respectively.
47
STATEMENT OF OPERATIONS (CONTINUED)
- -----------------------------------------------------------------------------------------------------
TOTAL INSTITUTIONAL
INTERNATIONAL DEVELOPED DEVELOPED
STOCK INDEX MARKETS INDEX MARKETS INDEX
FUND FUND FUND
--------------------------------------------------
SIX MONTHS ENDED APRIL 30, 2004
- -----------------------------------------------------------------------------------------------------
(000) (000) (000)
- -----------------------------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME
Income Distributions Received $ 93,582 $13,011 $13,041
Interest 39 29 5
- -----------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME--Note C 93,621 13,040 13,046
- -----------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS)
Capital Gain Distributions Received -- -- --
Investment Securities Sold -- (1,752) 107
- -----------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS) -- (1,752) 107
- -----------------------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) OF INVESTMENT SECURITIES 433,356 63,414 55,878
- -----------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $526,977 $74,702 $69,031
=====================================================================================================
48
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.
- -------------------------------------------------------------------------------------------------------------------
EUROPEAN STOCK PACIFIC STOCK
INDEX FUND INDEX FUND
------------------------------- -------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APR.30,2004 OCT.31,2003 APR.30,2004 OCT.31,2003
(000) (000) (000) (000)
- -------------------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 96,892 $ 145,899 $ 27,803 $ 30,033
Realized Net Gain (Loss) 6,214 (43,021) 7,346 (5,878)
Change in Unrealized Appreciation 724,246 1,114,572 244,364 620,071
(Depreciation)
- -------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net
Assets Resulting from Operations 827,352 1,217,450 279,513 644,226
- -------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Net Investment Income
Investor Shares (127,178) (95,319) (31,868) (15,919)
Admiral Shares (10,995) (8,302) (3,066) (1,318)
Institutional Shares (16,900) (10,645) (5,399) (2,312)
Realized Capital Gain
Investor Shares -- -- -- --
Admiral Shares -- -- -- --
Institutional Shares -- -- -- --
- -------------------------------------------------------------------------------------------------------------------
Total Distributions (155,073) (114,266) (40,333) (19,549)
- -------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS--Note G
Investor Shares 955,068 553,578 531,309 363,714
Admiral Shares 73,684 34,274 31,237 50,971
Institutional Shares 63,007 227,705 240,420 172,230
- -------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) from
Capital Share Transactions 1,091,759 815,557 802,966 586,915
- -------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) 1,764,038 1,918,741 1,042,146 1,211,592
- -------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Period 6,434,610 4,515,869 2,831,406 1,619,814
End of Period $8,198,648 $6,434,610 $3,873,552 $2,831,406
===================================================================================================================
49
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
- ---------------------------------------------------------------------------------------------------
EMERGING MARKETS
STOCK INDEX FUND
SIX MONTHS YEAR
ENDED ENDED
APR. 30, 2004 OCT. 31, 2003
(000) (000)
- ---------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 22,146 $ 26,515
Realized Net Gain (Loss) 26,857 (11,244)
Change in Unrealized Appreciation (Depreciation) 65,730 497,995
- ---------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from Operations 114,733 513,266
- ---------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Net Investment Income
Investor Shares (26,370) (14,099)
Institutional Shares (2,745) (1,409)
Realized Capital Gain
Investor Shares -- --
Institutional Shares -- --
- ---------------------------------------------------------------------------------------------------
Total Distributions (29,115) (15,508)
- ---------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS--Note G
Investor Shares 589,732 290,807
Institutional Shares 84,031 19,521
- ---------------------------------------------------------------------------------------------------
Net Increase (Decrease) from Capital Share Transactions 673,763 310,328
- ---------------------------------------------------------------------------------------------------
Total Increase (Decrease) 759,381 808,086
- ---------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Period 1,725,628 917,542
- ---------------------------------------------------------------------------------------------------
End of Period $2,485,009 $1,725,628
===================================================================================================
- ---------------------------------------------------------------------------------------------------
TOTAL INTERNATIONAL
STOCK INDEX FUND
--------------------------------
SIX MONTHS YEAR
ENDED ENDED
APR. 30, 2004 OCT. 31, 2003
(000) (000)
- ---------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 93,621 $ 59,797
Realized Net Gain (Loss) -- --
Change in Unrealized Appreciation (Depreciation) 433,356 894,167
- ---------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from Operations 526,977 953,964
- ---------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Net Investment Income (92,958) (59,624)
Realized Capital Gain -- --
- ---------------------------------------------------------------------------------------------------
Total Distributions (92,958) (59,624)
- ---------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) FROM CAPITAL SHARE 1,136,337 760,538
Transactions--Note G
- ---------------------------------------------------------------------------------------------------
Total Increase (Decrease) 1,570,356 1,654,878
- ---------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Period 4,538,477 2,883,599
- ---------------------------------------------------------------------------------------------------
End of Period $6,108,833 $4,538,477
===================================================================================================
50
- -------------------------------------------------------------------------------------------------------------------
INSTITUTIONAL
DEVELOPED MARKETS DEVELOPED MARKETS
INDEX FUND INDEX FUND
---------------------------- ---------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APR.30,2004 OCT.31,2003 APR.30,2004 OCT.31,2003
(000) (000) (000) (000)
- -------------------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 13,040 $ 6,567 $ 13,046 $ 8,163
Realized Net Gain (Loss) (1,752) -- 107 (10,096)
Change in Unrealized Appreciation
(Depreciation) 63,414 112,094 55,878 120,043
- -------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net
Assets Resulting from Operations 74,702 118,661 69,031 118,110
- -------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Net Investment Income (12,972) (6,494) (12,987) (8,134)
Realized Capital Gain -- -- -- --
- -------------------------------------------------------------------------------------------------------------------
Total Distributions (12,972) (6,494) (12,987) (8,134)
- -------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) FROM
CAPITAL SHARE TRANSACTIONS--Note G 201,929 176,561 88,516 195,677
- -------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) 263,659 288,728 144,560 305,653
- -------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Period 596,928 308,200 566,766 261,113
- -------------------------------------------------------------------------------------------------------------------
End of Period $860,587 $596,928 $711,326 $566,766
===================================================================================================================
51
FINANCIAL HIGHLIGHTS
This table summarizes each fund's investment results and distributions to
shareholders on a per-share basis for each class of shares. The table also
presents the fund's Total Return and shows net investment income and expenses as
percentages of average net assets. The Total International Stock, Developed
Markets, and Institutional Developed Markets Index Funds' expense ratios are
zero because they pay no direct expenses; these funds' share of the expenses of
the other funds in which they invest reduces the income received from them.
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.
EUROPEAN STOCK INDEX FUND INVESTOR SHARES
- ------------------------------------------------------------------------------------------------------------------------
SIX MONTHS YEAR ENDED YEAR ENDED
ENDED OCTOBER 31, JAN.1 TO DECEMBER 31,
FOR A SHARE OUTSTANDING APR. 30, ------------------ OCT. 31, --------------------------------
THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000 1999 1998
- ------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $19.93 $16.44 $19.50 $25.99 $28.82 $25.28 $20.13
- ------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .25 .44 .39 .37 .335 .50 .41
Net Realized and Unrealized Gain
(Loss) on Investments 2.28 3.45 (3.01) (6.85) (2.692) 3.69 5.40
- ------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.53 3.89 (2.62) (6.48) (2.357) 4.19 5.81
- ------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.46) (.40) (.44) (.01) (.423) (.50) (.52)
Distributions from Realized Capital
Gains -- -- -- -- (.050) (.15) (.14)
- ------------------------------------------------------------------------------------------------------------------------
Total Distributions (.46) (.40) (.44) (.01) (.473) (.65) (.66)
- ------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $22.00 $19.93 $16.44 $19.50 $25.99 $28.82 $25.28
========================================================================================================================
TOTAL RETURN** 12.81% 24.27% -13.81% -24.94% -8.18% 16.62% 28.86%
========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $6,853 $5,339 $3,870 $4,165 $5,611 $6,106 $4,479
Ratio of Total Expenses to
Average Net Assets 0.29%+ 0.32% 0.33% 0.30%+ 0.29% 0.29% 0.29%
Ratio of Net Investment Income to
Average Net Assets 2.50%+ 2.76% 2.24% 2.08%+ 1.64% 1.99% 1.97%
Portfolio Turnover Rate 4%+ 6% 15% 3% 8% 7% 7%
========================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**Total returns do not reflect the 0.5% transaction fee on purchases through
March 31, 2000; the 2% fee assessed on redemptions of shares purchased on or
after June 27, 2003, and held for less than two months; or the $10 annual
account maintenance fee applied on balances under $10,000.
+ Annualized.
52
EUROPEAN STOCK INDEX FUND ADMIRAL SHARES
- ------------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, AUG.13* TO
APR.30, ------------------ OCT.31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001**
- ----------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $46.82 $38.61 $45.77 $50.00
- ----------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .608 1.070 .96 .12
Net Realized and Unrealized Gain (Loss) on Investments 5.360 8.115 (7.08) (4.35)
- ----------------------------------------------------------------------------------------------------------------
Total from Investment Operations 5.968 9.185 (6.12) (4.23)
- ----------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (1.118) (.975) (1.04) .--
Distributions from Realized Capital Gains -- -- -- --
- ----------------------------------------------------------------------------------------------------------------
Total Distributions (1.118) (.975) (1.04) .--
- ----------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $51.67 $46.82 $38.61 $45.77
================================================================================================================
TOTAL RETURN+ 12.87% 24.42% -13.74% -8.46%
================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $566 $447 $335 $261
Ratio of Total Expenses to Average Net Assets 0.19%++ 0.23% 0.23% 0.25%++
Ratio of Net Investment Income to Average Net Assets 2.60%++ 2.84% 2.41% 0.70%++
Portfolio Turnover Rate 4%++ 6% 15% 3%
================================================================================================================
*Inception.
**The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
+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.
++Annualized.
53
FINANCIAL HIGHLIGHTS (CONTINUED)
EUROPEAN STOCK INDEX FUND INSTITUTIONAL SHARES
- ---------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, JAN.1 TO MAY15**
APR. 30, ---------------- OCT. 31, TO DEC. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000
- ---------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $19.96 $16.46 $19.52 $25.99 $27.22
- ---------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .27 .471 .414 .390 .172
Net Realized and Unrealized Gain (Loss) on Investments 2.28 3.454 (3.015) (6.848) (.965)
- ---------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.55 3.925 (2.601) (6.458) (.793)
- ---------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.49) (.425) (.459) (.012) (.437)
Distributions from Realized Capital Gains -- -- -- -- --
- ---------------------------------------------------------------------------------------------------------------
Total Distributions (.49) (.425) (.459) (.012) (.437)
- ---------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $22.02 $19.96 $16.46 $19.52 $25.99
===============================================================================================================
TOTAL RETURN+ 12.90% 24.49% -13.71% -24.85% -2.89%
===============================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $780 $649 $311 $248 $284
Ratio of Total Expenses to Average Net Assets 0.12%++ 0.17% 0.18% 0.20%++ 0.20%++
Ratio of Net Investment Income to Average Net Assets 2.63%++ 2.96% 2.46% 2.13%++ 1.19%++
Portfolio Turnover Rate 4%++ 6% 15% 3% 8%
===============================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**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.
++Annualized.
54
PACIFIC STOCK INDEX FUND INVESTOR SHARES
- -------------------------------------------------------------------------------------------------------------------
SIX MONTHS YEAR ENDED YEAR ENDED
ENDED OCTOBER 31, JAN.1 TO DECEMBER 31,
FOR A SHARE OUTSTANDING APR. 30, ---------------- OCT. 31, ----------------------------
THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000 1999 1998
- -------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $7.80 $5.90 $6.79 $8.95 $12.22 $ 7.84 $7.72
- -------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .064 .082 .065 .07 .077 .08 .085
Net Realized and Unrealized Gain
(Loss) on Investments .691 1.885 (.923) (2.23) (3.222) 4.39 .100
- -------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .755 1.967 (.858) (2.16) (3.145) 4.47 .185
- -------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.105) (.067) (.032) -- (.125) (.09) (.065)
Distributions from Realized Capital Gains -- -- -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------------
Total Distributions (.105) (.067) (.032) -- (.125) (.09) (.065)
- -------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.45 $7.80 $5.90 $6.79 $ 8.95 $12.22 $7.84
===================================================================================================================
TOTAL RETURN** 9.81% 33.75% -12.67% -24.13% -25.74% 57.05% 2.41%
===================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $2,993 $2,265 $1,386 $1,389 $1,823 $2,526 $1,033
Ratio of Total Expenses to
Average Net Assets 0.35%+ 0.39% 0.40% 0.37%+ 0.38% 0.37% 0.40%
Ratio of Net Investment Income to
Average Net Assets 1.64%+ 1.49% 1.04% 1.06%+ 0.68% 0.95% 1.17%
Portfolio Turnover Rate 1%+ 3% 20% 2% 6% 6% 4%
===================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**Total returns do not reflect the 0.5% transaction fee on purchases through
March 31, 2000; the 2% fee assessed on redemptions of shares purchased on or
after June 27, 2003, and held for less than two months; or the $10 annual
account maintenance fee applied on balances under $10,000.
+Annualized.
55
FINANCIAL HIGHLIGHTS (CONTINUED)
PACIFIC STOCK INDEX FUND ADMIRAL SHARES
- ---------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, AUG.13* TO
APR. 30, ---------------- OCT. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001**
- ---------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $51.05 $38.63 $44.40 $50.00
- ---------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .438 .575 .461 .20
Net Realized and Unrealized Gain (Loss) on Investments 4.505 12.318 (6.016) (5.80)
- ---------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.943 12.893 (5.555) (5.60)
- ---------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.733) (.473) (.215) --
Distributions from Realized Capital Gains -- -- -- --
- ---------------------------------------------------------------------------------------------------------------
Total Distributions (.733) (.473) (.215) --
- ---------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $55.26 $51.05 $38.63 $44.40
===============================================================================================================
TOTAL RETURN+ 9.82% 33.82% -12.55% -11.20%
===============================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $250 $198 $102 $80
Ratio of Total Expenses to Average Net Assets 0.26%++ 0.30% 0.30% 0.32%++
Ratio of Net Investment Income to Average Net
Assets 1.74%++ 1.59% 1.16% 2.05%++
Portfolio Turnover Rate 1%++ 3% 20% 2%
===============================================================================================================
*Inception.
**The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
+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.
++Annualized.
56
PACIFIC STOCK INDEX FUND INSTITUTIONAL SHARES
- ---------------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTH ENDED OCTOBER 31, JAN.1 TO MAY15**
APR. 30, --------------- OCT. 31, TO DEC. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $7.81 $5.91 $6.79 $8.95 $11.10
- ---------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .067 .090 .081 .08 .052
Net Realized and Unrealized Gain (Loss) on Investments .691 1.885 (.923) (2.24) (2.071)
- ---------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .758 1.975 (.842) (2.16) (2.019)
- ---------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.118) (.075) (.038) -- (.131)
Distributions from Realized Capital Gains -- -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------
Total Distributions (.118) (.075) (.038) -- (.131)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.45 $7.81 $5.91 $6.79 $ 8.95
=====================================================================================================================
TOTAL RETURN+ 9.85% 33.88% -12.44% -24.13% -18.19%
=====================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $630 $369 $131 $90 $102
Ratio of Total Expenses to Average Net Assets 0.17%++ 0.22% 0.25% 0.29%++ 0.29%++
Ratio of Net Investment Income to Average Net
Assets 1.85%++ 1.70% 1.20% 1.18%++ 0.79%++
Portfolio Turnover Rate 1%++ 3% 20% 2% 6%
=====================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**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.
++Annualized.
57
FINANCIAL HIGHLIGHTS (CONTINUED)
EMERGING MARKETS STOCK INDEX FUND INVESTOR SHARES
- ----------------------------------------------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, JAN.1 TO DECEMBER 31,
APR. 30, --------------- OCT. 31, ------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000 1999 1998
- ----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $11.04 $ 7.48 $7.28 $8.84 $12.50 $ 7.91 $9.98
INVESTMENT OPERATIONS
Net Investment Income .097 .170 .15 .19 .141 .24 .27
Net Realized and Unrealized Gain (Loss)
on Investments .805 3.512 .25 (1.74) (3.583) 4.62 (2.08)
- ----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .902 3.682 .40 (1.55) (3.442) 4.86 (1.81)
- ----------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.172) (.122) (.20) (.01) (.218) (.27) (.26)
Distributions from Realized Capital Gains -- -- -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Total Distributions (.172) (.122) (.20) (.01) (.218) (.27) (.26)
- ----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.77 $11.04 $7.48 $7.28 $ 8.84 $12.50 $7.91
======================================================================================================================
TOTAL RETURN** 8.22% 49.88% 5.27% -17.55% -27.56% 61.57%% -18.12
======================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $2,258 $1,589 $841 $770 $913 $1,138 $577
Ratio of Total Expenses to
Average Net Assets 0.50%+ 0.53% 0.57% 0.60%+ 0.59% 0.58% 0.61%
Ratio of Net Investment Income to
Average Net Assets 1.94%+ 2.26% 1.67% 2.69%+ 1.51% 2.55% 2.99%
Portfolio Turnover Rate 8%+ 16% 65% 23% 40% 22% 22%
======================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**Total returns do not reflect the 0.5% transaction fee on purchases (1.0% prior
to April 1, 2000); the 2% fee assessed on redemptions of shares purchased on or
after June 27, 2003, and held for less than two months; the 0.5% fee on all
other redemptions (1.0% prior to April 1, 2000); or the $10 annual account
maintenance fee applied on balances under $10,000.
+Annualized.
58
EMERGING MARKETS STOCK INDEX FUND INSTITUTIONAL SHARES
- -------------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, JAN. 1 TO JUNE 22**
APR. 30, ---------------- OCT. 31, TO DEC. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000
- -------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $11.05 $ 7.49 $7.29 $8.84 $11.16
- -------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .111 .183 .165 .200 .021
Net Realized and Unrealized Gain (Loss) on .805 3.512 .246 (1.739) (2.126)
Investments
- -------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .916 3.695 .411 (1.539) (2.105)
- -------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.186) (.135) (.211) (.011) (.215)
Distributions from Realized Capital Gains -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------------
Total Distributions (.186) (.135) (.211) (.011) (.215)
- -------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.78 $11.05 $7.49 $7.29 $ 8.84
===================================================================================================================
TOTAL RETURN+ 8.34% 50.06% 5.40% -17.42% -18.86%
===================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $227 $137 $76 $65 $19
Ratio of Total Expenses to Average Net Assets 0.33%++ 0.38% 0.41% 0.45%++ 0.45%++
Ratio of Net Investment Income to Average Net Assets 2.15%++ 2.41% 1.85% 2.75%++ 1.34%++
Portfolio Turnover Rate 8%++ 16% 65% 23% 40%
===================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**Inception.
+Total returns do not reflect the 0.5% transaction fee on purchases; the 2% fee
assessed on redemptions of shares purchased on or after June 27, 2003, and held
for less than two months; or the 0.5% fee on all other redemptions.
++Annualized.
59
FINANCIAL HIGHLIGHTS (CONTINUED)
TOTAL INTERNATIONAL STOCK INDEX FUND
- ---------------------------------------------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, JAN.1 TO DECEMBER 31,
APR. 30, --------------- OCT. 31, ------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000 1999 1998
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 9.84 $7.79 $8.99 $11.83 $14.31 $11.19 $ 9.87
- ---------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .19 .157 .165 -- .20 .21 .21
Capital Gain Distributions Received -- -- -- -- .01 .04 .02
Net Realized and Unrealized Gain (Loss) on
Investments .94 2.050 (1.200) (2.84) (2.44) 3.09 1.31
- ---------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.13 2.207 (1.035) (2.84) (2.23) 3.34 1.54
- ---------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.19) (.157) (.165) -- (.20) (.21) (.21)
Distributions from Realized Capital Gains -- -- -- -- (.05) (.01) (.01)
- ---------------------------------------------------------------------------------------------------------------------
Total Distributions (.19) (.157) (.165) -- (.25) (.22) (.22)
- ---------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.78 $9.84 $7.79 $ 8.99 $11.83 $14.31 $11.19
=====================================================================================================================
TOTAL RETURN** 11.55% 28.94% -11.80% -24.01% -15.61% 29.92% 15.60%
=====================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $6,109 $4,538 $2,884 $2,732 $2,920 $2,570 $1,375
Ratio of Total Expenses to
Average Net Assets--Note C 0%+ 0% 0% 0% 0% 0% 0%
Ratio of Net Investment Income to
Average Net Assets 1.69% 1.75% 1.70% 0.05%++ 1.68% 2.04% 2.18%
Portfolio Turnover Rate 2%++ 2% 5% 2% 3% 1% 2%
=====================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**Total returns do not reflect the 0.5% transaction fee on purchases through
March 31, 2000; the 2% fee assessed on redemptions of shares purchased on or
after June 27, 2003, and held for less than two months; or the $10 annual
account maintenance fee applied on balances under $10,000.
+The average weighted annualized expense ratio of the underlying funds was
0.33%.
++Annualized.
60
DEVELOPED MARKETS INDEX FUND
- -----------------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTH ENDED OCTOBER 31, JAN. 1 TO MAY 8**
APR. 30, --------------- OCT. 31, TO DEC. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000
- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $7.22 $5.80 $6.83 $9.07 $10.00
- -----------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .143 .116 .12 -- .15
Capital Gain Distributions Received -- -- -- -- --
Net Realized and Unrealized Gain (Loss) on Investments .710 1.420 (1.03) (2.24) (.93)
- -----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .853 1.536 (.91) (2.24) (.78)
- -----------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.143) (.116) (.12) -- (.15)
Distributions from Realized Capital Gains -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Total Distributions (.143) (.116) (.12) -- (.15)
- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $7.93 $7.22 $5.80 $6.83 $ 9.07
=======================================================================================================================
TOTAL RETURN+ 11.89% 27.06% -13.61% -24.70% -7.78%
=======================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $861 $597 $308 $145 $99
Ratio of Total Expenses to Average Net Assets--Note C 0%++ 0% 0% 0% 0%
Ratio of Net Investment Income to Average Net Assets 1.70% 1.48% 1.30% 0.04%+++ 1.66%+++
Portfolio Turnover Rate 3%+++ 7% 5% 9% 8%
=======================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**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, or the
$10 annual account maintenance fee applied on balances under $10,000.
++The average weighted annualized expense ratio of the underlying funds was
0.31%.
+++Annualized.
61
FINANCIAL HIGHLIGHTS (CONTINUED)
INSTITUTIONAL DEVELOPED MARKETS INDEX FUND
- --------------------------------------------------------------------------------------------------------------------
YEAR ENDED
SIX MONTHS ENDED OCTOBER 31, JAN.1 TO JUNE1**
APR. 30, ----------------- OCT. 31, TO DEC. 31,
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 2004 2003 2002 2001* 2000
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $7.16 $5.76 $6.78 $9.01 $10.00
- --------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .158 .126 .132 -- .15
Capital Gain Distributions Received -- -- -- -- --
Net Realized and Unrealized Gain (Loss) on Investments .700 1.400 (1.020) (2.23) (.99)
- --------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .858 1.526 (.888) (2.23) (.84)
- --------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.158) (.126) (.132) -- (.15)
Distributions from Realized Capital Gains -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
Total Distributions (.158) (.126) (.132) -- (.15)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $7.86 $7.16 $5.76 $6.78 $ 9.01
====================================================================================================================
TOTAL RETURN+ 12.07% 27.13% -13.41% -24.75% -8.38%
====================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $711 $567 $261 $206 $171
Ratio of Total Expenses to Average Net Assets--Note C 0%++ 0% 0% 0% 0%
Ratio of Net Investment Income to Average Net Assets 2.00% 1.80% 1.75% 0.05%+++ 1.74%+++
Portfolio Turnover Rate 24%+++ 11% 9% 3% 3%
====================================================================================================================
*The fund's fiscal year-end changed from December 31 to October 31, effective
October 31, 2001.
**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.
++The average weighted annualized expense ratio of the underlying funds was
0.14%.
+++Annualized.
SEE ACCOMPANYING NOTES, WHICH ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
62
NOTES TO FINANCIAL STATEMENTS
Vanguard International Stock Index Funds comprise the European, Pacific,
Emerging Markets, and Total International Stock Index Funds, the Developed
Markets Index Fund, and the Institutional Developed Markets Index Fund, each of
which is registered under the Investment Company Act of1940 as an open-end
investment company, or mutual fund. The European, Pacific, and Emerging Markets
Stock Index Funds each seek to match the performance of a distinct international
market index by investing in common stocks. The Total International Stock Index
Fund seeks to match the performance of its target index by investing in the
European, Pacific, and Emerging Markets Stock Index Funds. The Developed Markets
and Institutional Developed Markets Index Funds seek to match the performance of
their target index by investing in the European and Pacific Stock Index Funds.
The funds' direct and indirect investments in foreign securities involve
investment risks not normally associated with investing in securities of U.S.
corporations. The European and Pacific Stock Index Funds each offer three
classes of shares, Investor Shares, Admiral Shares, and Institutional Shares.
The Emerging Markets Stock Index 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. Admiral Shares are designed
for investors who meet certain administrative, servicing, tenure, and
account-size criteria. 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 funds consistently follow such
policies in preparing their financial statements.
1.SECURITY VALUATION: European, Pacific, and Emerging Markets Stock Index
Funds: 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 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, futures contracts or exchange-traded funds), between the time the
foreign markets close and the funds' pricing time, to determine whether a
significant change in value has occurred. 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.
Total International Stock, Developed Markets, and Institutional Developed
Markets Index Funds: Investments are valued at the net asset value of each
underlying Vanguard fund determined as of the close of the New York Stock
Exchange on the valuation date. All funds: 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 a part of the funds' fair-value
procedures, exchange rates may be adjusted if they change significantly
before the funds' pricing time but after the time at which the MSCI rates are
determined (generally 11 a.m., Eastern time).
63
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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 European Stock Index Fund uses
MSCI Pan-Euro Index futures contracts, and the Pacific Stock Index Fund
uses Topix Index futures contracts, to a limited extent, with the
objectives of maintaining full exposure to the stock market, enhancing
returns, maintaining liquidity, and minimizing transaction costs. The
funds may purchase futures contracts to immediately invest incoming cash
in the market, or sell futures in response to cash outflows, thereby
simulating a fully invested position in the underlying index while
maintaining a cash balance for liquidity. The funds may seek to enhance
returns by using futures contracts instead of the underlying securities
when futures are believed to be priced more attractively than the
underlying securities. The primary risks associated with the use of
futures contracts are imperfect correlation between changes in market
values of stocks held by the funds and the prices of futures contracts,
and the possibility of an illiquid market.
The European and Pacific Stock Index Funds also enter into forward
currency contracts to provide the appropriate currency exposure related to
any open futures contracts. The primary risk associated with the funds'
use of these contracts is that a counterparty will fail to fulfill its
obligation to pay gains due to the funds 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. SWAP CONTRACTS: The Emerging Markets Stock Index Fund has entered into
equity swap contracts to earn the total return on selected stocks in the
fund's target index, when investing through a swap provides a return
advantage over buying the individual stocks. Under the terms of each swap,
the fund receives the total return (either receiving the increase or
paying the decrease) on a reference stock, applied to a notional amount
that is the value of a designated number of shares of the stock at the
beginning of the swap. The fund agrees to pay the counterparty a floating
rate that is reset periodically based on short-term interest rates, less a
specified interest rate spread, applied to the notional amount. At the
same time, the fund invests an amount equal to the notional amount of the
swap in high-quality temporary cash investments. The primary risks
associated with the swaps are that a counterparty will default on its
obligation to pay net amounts due to the fund, or that the fund will incur
fees in the event it terminates a swap prior to the scheduled termination
date. The notional amounts of swap contracts are not recorded in the
financial statements. Swaps are valued daily and the change in value is
recorded as unrealized appreciation (depreciation) until termination of
the swap, at which time realized gain (loss) is recorded.
5. REPURCHASE AGREEMENTS: Each fund, along with other members of The Vanguard
Group, transfers uninvested cash balances to a pooled cash account, which
is invested in repurchase agreements secured by U.S. government
securities. Securities pledged as collateral for repurchase agreements are
held by a custodian bank until the agreements mature. Each agreement
requires that the market value of the collateral be sufficient to cover
payments of interest and principal; however, in the event of default or
bankruptcy by the other party to the agreement, retention of the
collateral may be subject to legal proceedings.
64
6.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.
7.DISTRIBUTIONS: Distributions to shareholders are recorded on the ex-dividend
date.
8.OTHER: Dividend income is recorded on the ex-dividend date. 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
capital share transactions 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. The Vanguard Group furnishes to the European, Pacific, and Emerging Markets
Stock Index Funds at cost investment advisory, corporate management,
administrative, marketing, and distribution services. The costs of such services
are allocated to the funds 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 April 30, 2004, the funds had contributed capital
to Vanguard (included in Other Assets) of:
- --------------------------------------------------------------------------------
CAPITAL CONTRIBUTION PERCENTAGE PERCENTAGE OF
TO VANGUARD OF FUND VANGUARD'S
INDEX FUND (000) NET ASSETS CAPITALIZATION
- --------------------------------------------------------------------------------
European $1,186 0.01% 1.19%
Pacific 574 0.02 0.57
Emerging Markets 382 0.02 0.38
- --------------------------------------------------------------------------------
The funds' trustees and officers are also directors and officers of Vanguard.
C. Under a service agreement, The Vanguard Group furnishes corporate management,
administrative, marketing, and distribution services to the Total International
Stock, Developed Markets, and Institutional Developed Markets Index Funds. The
special service agreement provides that Vanguard will reimburse the funds'
expenses to the extent of savings in administrative and marketing costs realized
by Vanguard in the operation of the funds. Accordingly, all expenses incurred by
the funds during the six months ended April 30, 2004, were reimbursed by
Vanguard.
D. 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 April 30, 2004, the European, Pacific, and Emerging Markets Stock Index
Funds realized net foreign currency gains (losses) of $510,000, $323,000, and
$(533,000), respectively, which permanently increased (decreased) distributable
net income for tax purposes; accordingly such gains (losses) have been
reclassified from accumulated net realized losses to undistributed net
investment income. The Emerging Markets Stock Index Fund also realized gains on
sales of "passive foreign
65
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
investment companies" of $14,000, which have been included in current and prior
periods' taxable income; accordingly such gains have been reclassified from
accumulated net realized losses to undistributed net investment income. The
Emerging Markets Stock Index Fund realized gains (losses) include realized gains
on swaps of $434,000 and taxes paid on realized capital gains on Indian
securities of ($143,000) which are treated as increases (decreases) to taxable
income; accordingly these amounts have been reclassified from accumulated net
realized losses to undistributed net investment income.
The funds' tax-basis capital gains and losses are determined only at the end of
each fiscal year. For tax purposes, at October 31, 2003, the following funds had
tax-basis capital losses available to offset future net capital gains:
- --------------------------------------------------------------------------------
CAPITAL LOSSES
---------------------------------
EXPIRATION: FISCAL
AMOUNT YEARS ENDING
INDEX FUND (000) OCTOBER 31
- --------------------------------------------------------------------------------
European $374,339 2008-2011
Pacific 178,735 2006-2011
Emerging Markets 177,644 2006-2011
Total International 51,127 2009-2010
Institutional Developed Markets 10,096 2011
- --------------------------------------------------------------------------------
The funds will use these capital losses to offset net taxable capital gains, if
any, realized during the year ending October 31, 2004; should the funds realize
net capital losses for the year, the losses will be added to the loss
carryforward balances above.
At April 30, 2004, net unrealized appreciation of investment securities for tax
purposes was:
- --------------------------------------------------------------------------------
(000)
----------------------------------------------
NET UNREALIZED
APPRECIATED DEPRECIATED APPRECIATION
INDEX FUND SECURITIES SECURITIES (DEPRECIATION)
- --------------------------------------------------------------------------------
European $1,777,999 $(512,311) $1,265,688
Pacific 422,714 (345,891) 76,823
Emerging Markets 425,974 (201,424) 224,550
Total International 234,672 (5,585) 229,087
Developed Markets 86,454 -- 86,454
Institutional Developed Markets 73,596 -- 73,596
- --------------------------------------------------------------------------------
At April 30, 2004, the aggregate settlement value of open futures contracts and
the related unrealized appreciation (depreciation) were:
- --------------------------------------------------------------------------------
(000)
----------------------------
AGGREGATE UNREALIZED
NUMBER OF SETTLEMENT APPRECIATION
INDEX FUND/FUTURES CONTRACTS LONG CONTRACTS VALUE (DEPRECIATION)
- --------------------------------------------------------------------------------
European/
MSCI Pan-Euro Index, exp. 6/2004 1,911 $37,754 $610
Pacific/
Topix Index, exp. 6/2004 90 9,640 465
- --------------------------------------------------------------------------------
66
At April 30, 2004, the European and Pacific Stock Index Funds had open forward
currency contracts to receive and deliver currencies as follows:
- --------------------------------------------------------------------------------
(000)
------------------------------------------
CONTRACT AMOUNT UNREALIZED
------------------------- APPRECIATION
INDEX FUND/CONTRACT SETTLEMENT DATE RECEIVE DELIVER (DEPRECIATION)
- --------------------------------------------------------------------------------
European 6/23/2004 EUR 30,931 USD 37,027 $(730)
Pacific 6/15/2004 JPY 1,100,000 USD 9,980 (57)
- --------------------------------------------------------------------------------
EUR--euro.
JPY--Japanese yen.
USD--U.S. dollars.
Unrealized appreciation (depreciation) on open forward currency contracts is
treated as realized gain (loss) for tax purposes.
The European, Pacific, and Emerging Markets Stock Index Funds had net unrealized
foreign currency losses of $278,000, $576,000, and $128,000, respectively,
resulting from the translation of other assets and liabilities at April 30,
2004.
At April 30, 2004, the Emerging Markets Stock Index Fund had the following open
swap contracts with Morgan Stanley & Co. International Limited as counterparty:
- ---------------------------------------------------------------------------------------------------------
UNREALIZED
NOTIONAL FLOATING MARKET APPRECIATION
TERMINATION AMOUNT INTEREST VALUE (DEPRECIATION)
FUND/COUNTRY/REFERENCE STOCK DATE (000) RATE* (000) (000)
- ---------------------------------------------------------------------------------------------------------
Emerging Markets
South Korea
KT Corp. 7/8/2004 $1,621 2.90% $1,464 $ (157)
SK Telecom Co., Ltd. 7/8/2004 3,504 2.90% 4,091 587
Taiwan
BENQ Corp. 7/7/2004 447 2.90% 706 259
Cathay Financial Holding Co. 7/7/2004 2,687 2.65% 4,262 1,575
China Development
Financial Holding Corp. 7/7/2004 656 1.40% 1,003 347
CMC Magnetics Corp. 7/7/2004 432 2.90% 722 290
Gigabyte Technology Co., Ltd. 7/7/2004 260 2.90% 348 88
Hon Hai Precision
Industry Co., Ltd. 7/7/2004 409 0.90% 455 46
Lite-On Technology Corp. 7/7/2004 322 2.90% 420 98
Macronix International Co., Ltd. 7/7/2004 226 2.90% 520 294
Quanta Computer Inc. 7/7/2004 858 2.90% 1,098 240
Realtek Semiconductor Corp. 7/7/2004 356 1.40% 301 (55)
Ritek Corp. 7/7/2004 320 1.90% 482 162
Siliconware Precision
Industries Co. 7/7/2004 325 2.90% 573 248
Via Technologies Inc. 7/7/2004 412 1.90% 386 (26)
---------
3,996
---------
- ---------------------------------------------------------------------------------------------------------
*Based on one-month London InterBank Offered Rate (LIBOR). Each contract
provides for the payment of interest based on LIBOR less a fixed interest rate
spread. At April 30, 2004, the spread was greater than LIBOR, resulting in net
interest earned by the fund at the rate shown above.
67
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
E. During the six months ended April 30, 2004, purchases and sales of investment
securities other than temporary cash investments were:
- --------------------------------------------------------------------------------
(000)
-------------------------------
INDEX FUND PURCHASES SALES
European $1,151,298 $141,307
Pacific 834,114 13,278
Emerging Markets 771,983 84,515
Total International 1,199,584 62,902
Developed Markets 213,973 12,326
Institutional Developed Markets 163,826 76,084
- --------------------------------------------------------------------------------
F. The market value of securities on loan to broker/dealers at April 30, 2004,
and collateral received with respect to such loans were:
- --------------------------------------------------------------------------------
(000)
-------------------------------
MARKET VALUE CASH
OF LOANED COLLATERAL
INDEX FUND SECURITIES RECEIVED
- --------------------------------------------------------------------------------
European $1,556,833 $1,652,356
Pacific 388,598 411,300
- --------------------------------------------------------------------------------
The funds invest cash collateral received in repurchase agreements, and record a
liability for the return of the collateral, during the period the securities are
on loan.
G. Capital share transactions for each class of shares were:
- -------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2004 OCT. 31, 2003
-------------------------------------------------
AMOUNT SHARES AMOUNT SHARES
INDEX FUND (000) (000) (000) (000)
- -------------------------------------------------------------------------------------------------------
EUROPEAN
Investor Shares
Issued $1,107,013 50,198 $919,668 53,722
Issued in Lieu of Cash Distributions 122,204 5,836 90,697 5,679
Redeemed* (274,149) (12,413) (456,787) (27,003)
------------------------------------------------
Net Increase (Decrease)--Investor Shares 955,068 43,621 553,578 32,398
------------------------------------------------
Admiral Shares
Issued 97,742 1,878 98,535 2,450
Issued in Lieu of Cash Distributions 8,521 173 6,400 171
Redeemed* (32,579) (632) (70,661) (1,768)
------------------------------------------------
Net Increase (Decrease)--Admiral Shares 73,684 1,419 34,274 853
------------------------------------------------
Institutional Shares
Issued 193,303 8,848 351,531 20,586
Issued in Lieu of Cash Distributions 15,587 744 10,145 635
Redeemed* (145,883) (6,680) (133,971) (7,589)
------------------------------------------------
Net Increase (Decrease)--Institutional Shares 63,007 2,912 227,705 13,632
- -------------------------------------------------------------------------------------------------------
68
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2004 OCT. 31, 2003
---------------------- --------------------
AMOUNT SHARES AMOUNT SHARES
INDEX FUND (000) (000) (000) (000)
- -------------------------------------------------------------------------------------------------------
PACIFIC
Investor Shares
Issued $634,998 76,489 $529,652 81,854
Issued in Lieu of Cash Distributions 30,438 3,948 15,104 2,640
Redeemed** (134,127) (16,433) (181,042) (28,933)
------------------------------------------------
Net Increase (Decrease)--Investor Shares 531,309 64,004 363,714 55,561
------------------------------------------------
Admiral Shares
Issued 101,903 1,905 73,096 1,757
Issued in Lieu of Cash Distributions 2,258 45 1,055 28
Redeemed** (72,924) (1,292) (23,180) (567)
------------------------------------------------
Net Increase (Decrease)--Admiral Shares 31,237 658 50,971 1,218
------------------------------------------------
Institutional Shares
Issued 344,682 40,011 244,471 37,056
Issued in Lieu of Cash Distributions 5,334 692 2,099 367
Redeemed** (109,596) (13,402) (74,340) (12,425)
------------------------------------------------
Net Increase (Decrease)--Institutional Shares 240,420 27,301 172,230 24,998
- -------------------------------------------------------------------------------------------------------
EMERGING MARKETS
Investor Shares
Issued $703,894 57,023 $399,952 44,002
Issued in Lieu of Cash Distributions 24,126 2,114 12,798 1,624
Redeemed+ (138,288) (11,316) (121,943) (14,176)
------------------------------------------------
Net Increase (Decrease)--Investor Shares 589,732 47,821 290,807 31,450
------------------------------------------------
Institutional Shares
Issued 85,418 7,034 31,104 3,725
Issued in Lieu of Cash Distributions 1,796 157 1,016 129
Redeemed+ (3,183) (255) (12,599) (1,658)
------------------------------------------------
Net Increase (Decrease)--Institutional Shares 84,031 6,936 19,521 2,196
- -------------------------------------------------------------------------------------------------------
TOTAL INTERNATIONAL
Issued $1,470,470 136,351 $1,204,305 144,867
Issued in Lieu of Cash Distributions 85,441 8,208 54,512 7,211
Redeemed++ (419,574) (38,789) (498,279) (61,379)
------------------------------------------------
Net Increase (Decrease) 1,136,337 105,770 760,538 90,699
- -------------------------------------------------------------------------------------------------------
DEVELOPED MARKETS
Issued $256,054 32,629 $272,248 45,434
Issued in Lieu of Cash Distributions 11,440 1,495 5,661 1,009
Redeemed+++ (65,565) (5,274) (101,348) (16,899)
------------------------------------------------
Net Increase (Decrease) 201,929 28,850 176,561 29,544
- -------------------------------------------------------------------------------------------------------
69
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2004 OCT. 31, 2003
-------------------- -----------------
AMOUNT SHARES AMOUNT SHARES
INDEX FUND (000) (000) (000) (000)
- -------------------------------------------------------------------------------------------------------
INSTITUTIONAL DEVELOPED MARKETS
Issued $160,201 20,850 $254,567 43,178
Issued in Lieu of Cash Distributions 7,931 1,048 3,270 589
Redeemed++++ (79,616) (10,484) (62,160) (9,994)
-------------------------------------------------
Net Increase (Decrease) 88,516 11,414 195,677 33,773
- -------------------------------------------------------------------------------------------------------
*European Stock Index Fund amounts are net of redemption fees of $54,000 and
$24,000, respectively (fund totals).
**Pacific Stock Index Fund amounts are net of redemption fees of $100,000 and
$27,000, respectively (fund totals).
+Emerging Markets Stock Index Fund amounts are net of redemption fees of
$587,000 and $499,000, respectively (fund totals).
++Total International Stock Index Fund amounts are net of redemption fees of
$116,000 and $24,000, respectively.
+++Developed Markets Index Fund amounts are net of redemption fees of $0 and
$3,000, respectively.
++++Institutional Developed Markets Index Fund amounts are net of redemption
fees of $0 and $0, respectively.
70
- --------------------------------------------------------------------------------
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- --------------------------------------------------------------------------------
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71
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(R) 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
- --------------------------------------------------------------------------------
POSITION(S) HELD WITH
NAME FUND (NUMBER OF
(YEAR OF BIRTH) VANGUARD FUNDS
TRUSTEE/OFFICER OVERSEEN BY
SINCE TRUSTEE/OFFICER) PRINCIPAL OCCUPATION(S) DURING THE PAST FIVE YEARS
- ----------------------------------------------------------------------------------------------------------------------
JOHN J. BRENNAN* Chairman of the Chairman of the Board, Chief Executive Officer, and Director/Trustee of
(1954) Board, Chief The Vanguard Group, Inc., and of each of the investment companies
May 1987 Executive Officer, served by The Vanguard Group.
and Trustee
(129)
- ----------------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
CHARLES D. ELLIS Trustee The Partners of '63 (pro bono ventures in education); Senior Advisor
(1937) (129) to Greenwich Associates (international business strategy consulting);
January 2001 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 Trustee Chairman and Chief Executive Officer (since October 1999), Vice
(1945) (129) Chairman (January-September 1999), and Vice President (prior to
December 2001 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 Trustee Vice President, Chief Information Officer, and Member of the
HEISEN (129) Executive Committee of Johnson & Johnson (pharmaceuticals/
(1950) consumer products); Director of the University Medical Center at
July 1998 Princeton and Women's Research and Education Institute.
- ----------------------------------------------------------------------------------------------------------------------
BURTON G. MALKIEL Trustee Chemical Bank Chairman's Professor of Economics, Princeton
(1932) (127) University; Director of Vanguard Investment Series plc (Irish invest-
May 1977 ment fund) (since November 2001), Vanguard Group (Ireland)
Limited (Irish investment management firm) (since November 2001),
Prudential Insurance Co. of America, BKF Capital (investment
management), The Jeffrey Co. (holding company), and NeuVis, Inc.
(software company).
- ----------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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.
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.
- --------------------------------------------------------------------------------
POSITION(S) HELD WITH
NAME FUND (NUMBER OF
(YEAR OF BIRTH) VANGUARD FUNDS
TRUSTEE/OFFICER OVERSEEN BY
SINCE TRUSTEE/OFFICER) PRINCIPAL OCCUPATION(S) DURING THE PAST FIVE YEARS
- ------------------------------------------------------------------------------------------------------------
ALFRED M. RANKIN, JR. Trustee Chairman, President, Chief Executive Officer, and Director of NACCO
(1941) (129) Industries, Inc. (forklift trucks/housewares/lignite); Director of
January 1993 Goodrich Corporation (industrial products/aircraft systems and
services); Director of Standard Products Company (supplier for
the automotive industry) until 1998.
- ------------------------------------------------------------------------------------------------------------
J. LAWRENCE WILSON Trustee Retired Chairman and Chief Executive Officer of Rohm and Haas Co.
(1936) (129) (chemicals); Director of Cummins Inc. (diesel engines), The Mead
April 1985 Corp. (paper products), and AmerisourceBergen Corp. (pharmaceutical
distribution); Trustee of Vanderbilt University.
- ------------------------------------------------------------------------------------------------------------
EXECUTIVE OFFICERS*
R. GREGORY BARTON Secretary Managing Director and General Counsel of The Vanguard Group, Inc.;
(1951) (129) Secretary of The Vanguard Group and of each of the investment
June 2001 companies served by The Vanguard Group.
- ------------------------------------------------------------------------------------------------------------
THOMAS J. HIGGINS Treasurer Principal of The Vanguard Group, Inc.; Treasurer of each of the
(1957) (129) investment companies served by The Vanguard Group.
July 1998
- ------------------------------------------------------------------------------------------------------------
*Officers of the funds are "interested persons" as defined in the Investment
Company Act of 1940.
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. MICHAEL S. MILLER, Planning and Development.
JAMES H. GATELY, Investment Programs and Services. RALPH K. PACKARD, Finance.
KATHLEEN C. GUBANICH, Human Resources. GEORGE U. SAUTER, Chief Investment Officer.
F. WILLIAM MCNABB, III, Client Relationship Group.
- ------------------------------------------------------------------------------------------------------------
JOHN C. BOGLE, Founder; Chairman and Chief Executive Officer, 1974-1996.
- ------------------------------------------------------------------------------------------------------------
[SHIP LOGO]
Post Office Box 2600
Valley Forge, PA 19482-2600
Vanguard, The Vanguard Group, Vanguard.com, Admiral, PlainTalk, and the ship
logo are trademarks of The Vanguard Group, Inc.
All other marks are the exclusive property of their respective owners.
The funds or securities referred to herein that are offered by The Vanguard
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Information contains a more detailed description of the limited relationship
MSCI has with The Vanguard Group.
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The photographs that appear on the cover of this report are copyrighted by
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FOR MORE INFORMATION
This report is intended for the funds' shareholders. It may not be distributed
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To receive a free copy of the prospectus or the Statement of Additional
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(C)2004 The Vanguard Group, Inc.
All rights reserved.
Vanguard Marketing
Corporation, Distributor.
Q722 062004
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: 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 Controls. There were no significant changes in Registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Item 11: Exhibits.
(a) 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 INTERNATIONAL EQUITY INDEX FUNDS
BY: (signature)
----------------------------------------
(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER
Date: June 14, 2004
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 INTERNATIONAL EQUITY INDEX FUNDS
BY: (signature)
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(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER
Date: June 14, 2004
VANGUARD INTERNATIONAL EQUITY INDEX FUNDS
BY: (signature)
----------------------------------------
(HEIDI STAM)
THOMAS J. HIGGINS*
TREASURER
Date: June 14, 2004
*By Power of Attorney. See File Number 2-57689, filed on December 26, 2002.
Incorporated by Reference.