Global Equity Fund (VHGEX)

portfolio.Content-187 MSCI AC World Index Net

  Fact sheet (12/31/2013)

Characteristics

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Stocks
Broadly diversified portfolio of stocks from U.S. and non-U.S. markets.



Expected range
Central tendency

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Market capitalization
as of 03/31/2014

  VHGEX Benchmark

MSCI All Country World Index Net

+/- Weight
Large 21.9% 36.2% – 14.3%
Medium/Large 23.8% 26.8% – 3.0%
Medium 23.3% 21.4% 1.9%
Medium/Small 18.9% 13.0% 5.9%
Small 12.1% 2.6% 9.5%
Total 100.0% 100.0%  

More information about market capitalization  


Fundamentals
as of 03/31/2014

  VHGEX Benchmark

MSCI All Country World Index Net

+/- Weight
Number of stocks 695 2,423 – 1,728
Median market cap $22.7 billion $46.3 billion – $23.6 billion
% Emerging 10.40% 8.80% 1.60%
% Developed 89.60% 91.20% – 1.60%
  VHGEX Benchmark

MSCI All Country World Index Net

Earnings growth rate 13.0% 10.4%
Short-term reserves 1.33% N/A
% of ADR/GDR (as of 12/31/2013) 4.62% N/A
P/E ratio 17.3x 17.4x
P/B ratio 2.1x 2.0x
Turnover rate (Fiscal year-end 09/30/2013) 70.4% N/A
Return on equity 15.9% 16.5%
Foreign holdings 51.44% N/A

Composition

Regional exposure  (% of equities)

Select time  
  Region
 
 VHGEX
 
Benchmark

MSCI All Country World Index Net

 
+/- Weight
 
North America 49.1% 52.7% – 3.6%
Europe 24.6% 25.2% – 0.6%
Pacific 14.8% 13.5% 1.3%
Emerging Markets 10.5% 8.4% 2.1%
Other 1.0%
Middle East 0.0% 0.2% – 0.2%
0%
55%
Total 100.0% 100.0%  

Country diversification  (% of equities)
as of 03/31/2014

  Country
 
 VHGEX
 
Benchmark

MSCI All Country World Index Net

 
+/- Weight
 
Region
 
United States 46.4% 49.0% – 2.6% North America
Japan 9.0% 7.3% 1.7% Pacific
United Kingdom 8.3% 7.7% 0.6% Europe
Switzerland 3.5% 3.4% 0.1% Europe
Korea 3.3% 1.7% 1.6% Pacific
Canada 3.1% 3.7% – 0.6% North America
Sweden 2.7% 1.2% 1.5% Europe
Taiwan 2.4% 1.3% 1.1% Emerging Markets
Germany 2.2% 3.5% – 1.3% Europe
China 2.2% 2.0% 0.2% Emerging Markets
France 2.1% 3.8% – 1.7% Europe
India 1.9% 0.7% 1.2% Emerging Markets
South Africa 1.3% 0.8% 0.5% Emerging Markets
Denmark 1.2% 0.5% 0.7% Europe
Norway 1.2% 0.3% 0.9% Europe
Ireland 1.0% 0.1% 0.9% Europe
Other 1.0% Other
Australia 0.9% 2.9% – 2.0% Pacific
Hong Kong 0.9% 1.0% – 0.1% Pacific
Netherlands 0.6% 1.0% – 0.4% Europe
Singapore 0.6% 0.5% 0.1% Pacific
Brazil 0.6% 1.2% – 0.6% Emerging Markets
Mexico 0.6% 0.5% 0.1% Emerging Markets
Italy 0.5% 1.0% – 0.5% Europe
Spain 0.5% 1.3% – 0.8% Europe
Finland 0.4% 0.3% 0.1% Europe
Chile 0.2% 0.2% 0.0% Emerging Markets
Indonesia 0.2% 0.3% – 0.1% Emerging Markets
Malaysia 0.2% 0.4% – 0.2% Emerging Markets
Russia 0.2% 0.6% – 0.4% Emerging Markets
Thailand 0.2% 0.2% 0.0% Emerging Markets
Turkey 0.2% 0.2% 0.0% Emerging Markets
Austria 0.1% 0.1% 0.0% Europe
Belgium 0.1% 0.4% – 0.3% Europe
Colombia 0.1% 0.1% 0.0% Emerging Markets
Philippines 0.1% 0.1% 0.0% Emerging Markets
Greece 0.1% Europe
Portugal 0.1% Europe
New Zealand 0.0% 0.1% – 0.1% Pacific
Poland 0.0% 0.2% – 0.2% Emerging Markets
Israel 0.2% Middle East
0%
50%
Total 100.0% 100.0%

Sector weightings
as of 03/31/2014

  Sector
 
 VHGEX
 
Benchmark

MSCI All Country World Index Net

 
+/- Weight
 
Financials 21.1% 21.5% – 0.4%
Information Technology 17.5% 12.7% 4.8%
Industrials 16.2% 10.8% 5.4%
Consumer Discretionary 12.5% 11.7% 0.8%
Consumer Staples 9.6% 9.7% – 0.1%
Energy 8.0% 9.7% – 1.7%
Health Care 8.0% 10.6% – 2.6%
Materials 4.0% 6.1% – 2.1%
Telecommunication Services 2.3% 3.9% – 1.6%
Utilities 0.8% 3.3% – 2.5%
Other 0.0% 0.0% 0.0%
0%
25%
Total 100.0% 100.0%

Sector categories are based on the Global Industry Classification Standard system.

People and process

Firms

Baillie Gifford Overseas Ltd.
Marathon Asset Management LLP
Acadian Asset Management LLC

Product management

Vanguard Global Equity Fund seeks long-term capital appreciation by investing worldwide in growth and value stocks of all capitalization sizes. The advisors’ bottom-up stock selection results in a diversified global portfolio invested across sectors and both developed and emerging markets.

Acadian Asset Management LLC

Acadian employs a quantitative investment process that seeks to outperform the MSCI All Country World Free Index.  The investment process builds portfolios from the bottom up using proprietary valuation models measuring over 20 stock factors and focusing those that have proven most effective in predicting returns. The result is a rating of all securities in the Acadian database, in terms of each stock’s expected return relative to its country- and sector-level group. A portfolio optimization program is used to balance the expected return of the stocks with such considerations as the benchmark index, desired level of risk, and transaction cost estimates.

Firm Description

Founded in 1986, Acadian Asset Management is a Boston-based investment management firm specializing in quantitative equity strategies for developed and emerging markets.  The firm has advised Vanguard Global Equity Fund since 2004.

Investment Manager Biographies

John R. Chisholm, CFA, Executive Vice President and CIO

  • Portfolio manager.
  • Advised the fund since 2004.
  • Worked in investment management since 1984.
  • B.S., Massachusetts Institute of Technology.
  • M.B.A., Massachusetts Institute of Technology.

Ronald D. Frashure, CFA, Chairman

  • Portfolio manager.
  • Advised the fund since 2004.
  • Worked in investment management since 1974.
  • B.S., Massachusetts Institute of Technology.
  • M.B.A., Harvard Business School.

Brian K. Wolahan, CFA, Senior Vice President and Director of Alternative Strategies

  • Portfolio manager.
  • Advised the fund since 2004.
  • Worked in investment management since 1985.
  • B.S., Lehigh University.
  • M.B.A., Massachusetts Institute of Technology.

Baillie Gifford Overseas Ltd.

The firm’s investment approach is based on long-term investments in well-researched and well-managed businesses that enjoy sustainable competitive advantages in their marketplaces. In managing its portion of the fund’s assets, the firm employs a fundamental “bottom up” approach to identify growth companies, screening them for quality, then value. The main factors considered are sustainable earnings growth, cash-flow generation, profitability, interest coverage, and valuation.

Firm Description

Baillie Gifford Overseas Ltd., Edinburgh, Scotland—a unit of Baillie Gifford & Co., founded in 1908—is among the largest independently owned investment management firms in the United Kingdom. The firm has advised Vanguard Global Equity Fund since 2008.

Investment Manager Biographies

Charles Plowden, Joint Senior Partner, Chief of Investment Staff, and Lead Portfolio Manager

  • Portfolio manager.
  • Advised the fund since 2008.
  • Worked in investment management since 1983.
  • B.A., Oxford University.

Spencer Adair, CFA, Investment Manager, Global Alpha Strategy

  • Portfolio manager.
  • Advised the fund since 2008.
  • Worked in investment management since 2000.
  • B.S., University of St. Andrews.

Malcolm MacColl, Investment Manager, Global Alpha Strategy

  • Portfolio manager.
  • Advised the fund since 2008.
  • Worked in investment management since 1999.
  • M.A., M. Litt., University of St. Andrews.

Marathon Asset Management LLP

Unlike many global advisors that rely on macroeconomic forecasts to determine country allocations, Marathon uses a bottom-up approach that focuses on stock selection. Traditional company analysis is de-emphasized in favor of assessing enterprise value, corporate strategy, industry competition, and prospective rate of return on new investments. Sector analysis is conducted using long-term capital cycle data, and country allocations tend to reflect monetary conditions and investor confidence. Individual stock concentrations are low, with the top 25 stocks comprising only 20%–30% of portfolio assets. The subportfolio’s country and industry sector allocations may vary significantly from the benchmark.

Firm Description

Founded in 1986, Marathon Asset Management, LLP, of London, England, specializes in applying nontraditional analytical techniques to global portfolios. The firm has advised Vanguard Global Equity Fund since the fund's inception in 1995.

Investment Manager Biographies

Neil M. Ostrer, Director

  • Portfolio manager.
  • Advised the fund since 1995.
  • Worked in investment management since 1981.
  • M.A., Cambridge University.

William J. Arah, Director

  • Portfolio manager.
  • Advised the fund since 1995.
  • Worked in investment management since 1982.
  • M.A., Oxford University. 

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