Find out how the four cornerstones of model portfolio oversight at Vanguard work for you

You and your clients can enjoy the peace of mind of our rigorous four-pillar approach to developing and managing model portfolios. You’ll be tapping a deep bench of talents of a company that is a leader in indexing and portfolio construction.

Teams of in-house experts across disciplines keep a close eye on these broadly diversified investment solutions available for your clients. Specialists in investing, economics, and multi-asset allocation help build and continuously monitor the portfolios. They use sophisticated analytical tools and proprietary methodologies. You’ll quickly discover our oversight is rigorous and data-driven.

Sharing our approach with clients could help them understand how much sophisticated work supports the portfolios you are selecting for them. The full weight of Vanguard is behind the construction and oversight of these products that you help match to your clients’ needs and risk profiles.

Are the portfolios doing what they were designed to do?

Do changes need to be made?

Is Vanguard offering all the portfolios that advisors want and need?

Our researchers seek to answer these and other questions with help from constant surveillance and proprietary methodologies. These teams are the brains behind when to adjust allocations, when to rebalance, and when to change product offerings.

The market watchers

Meet the experts who monitor the model portfolio landscape and identify models that advisors need.

The expert researchers in model portfolio Strategy and Development develop and refine the pipeline of model portfolios that Vanguard delivers to advisors. They continuously collect feedback from advisors while simultaneously recommending potential changes to portfolio constraints based on that real-time market feedback. 

What are advisor preferences?

Do advisors want portfolios with different exposures?

Are the model portfolios tracking indices as they were designed to do?

Strategy and development experts evaluate the model portfolio landscape to stay abreast of trends that could inform future product development.

This group works closely with the Vanguard sales representatives helping financial advisors adopt and implement these portfolio solutions within their practices.

The researchers

Tap into industry-leading experts and proprietary methodologies guiding model portfolio construction and monitoring.

You get eight teams of subject-matter specialists in the Vanguard Investment Strategy Group. They use proprietary investing methodologies to perform important analyses and develop asset allocations. These researchers are deeply credentialed and often have long tenures in their areas of expertise.

Many have Ph.D.s and CFA® designations—a depth of knowledge that could be invaluable to those advisory practices that lack the same sort of bandwidth in this area.

These strategists have a dual role of informing internal decision-making at Vanguard and sharing their empirical findings with a global audience through published work.

These front-line experts analyze what’s shaping financial markets, the economy, and the industry at large, and help guide how our model portfolios are built­ and intended to perform.

Here’s how these investment strategists directly help you. They:

• Ensure portfolio allocations stay in line with what the methodology initially called for.
• Monitor market drift every month.
• Recommend when to recalibrate allocations to get back to those original target breakdowns.
• Oversee the annual rebalancing of model portfolios.

The forecasting and modeling platforms this group uses, plus the advice methodologies, bring objectivity and consistency to the construction and monitoring of our model portfolios.

The researchers in the Vanguard Investment Strategy Group’s eight teams specialize in the following areas: Asset allocation, economics, capital markets, goals-based investing, retirement, investor behavior, active investing, and indexed investing.

Here are the three teams most heavily involved in model portfolio oversight:

• Economics >> Create and publish economic outlooks to inform investing decisions.
• Asset Allocation >> Apply those outlooks to portfolio construction.
• Capital Markets >> Use those forecasts for market simulations in ongoing re-evaluation of the models.

The senior leaders

Discover the top-level oversight of our model portfolios and methodology.

Our chief investment officer and chief economist lead the Strategic Asset Allocation Committee. This group approves changes to existing model portfolios or the introduction of new ones to market. They also serve as gatekeepers over whether and when to update asset allocations and other aspects of Vanguard’s multi-asset products.

They make these decisions based on careful consideration of the research, analysis, and recommendations of the scores of investment strategists and product researchers who examine model portfolios all year long.

Members of this committee lead annual due diligence reviews and meet regularly to review investment methodology and debate investment strategies. Global investment leaders from across Vanguard are on this committee.

These leaders consider the findings of our investment strategists and market analysts. They also lean on the work of one more group that is an important part of the model portfolios oversight process: Portfolio Review and Development. While not as prominently involved in oversight as the other three, this last group of analysts are foundational in ensuring model portfolios are the product of a deliberative process rooted in data analysis.

The fund experts

Meet the team who monitors underlying model portfolio funds and fund managers.

The Portfolio Review Department plays a central role at the time that a model portfolio is proposed and put together.

These analysts help identify the many individual investment funds that could be used to build a particular portfolio. They recommend specific funds based on the goals and objectives of a particular model: tax efficiency, for instance, or income, or total return over a long horizon.

Portfolio Review and Development are responsible for fund and fund manager oversight, product management, and strategy of multi-asset funds at Vanguard. They are the hub who help take new model portfolios through our rigorous approval structure.

They also continuously help monitor the core components that have been stitched together to produce a model portfolio.

If index funds or active ones are the core of a model portfolio, PRD analysts will study whether they are performing as designed or as expected to perform. They share their work with the other oversight teams all year round.

Model portfolios: Good for clients, good for you

See how Vanguard model portfolios can potentially help you deliver more for clients and your practice.

Vanguard Model portfolios:  Foundational investments

Total-return and objective-based models are crafted to meet the differing needs and risk profiles of your clients.

Additional model portfolio resources:

What’s behind our portfolio construction process?

Grow your practice and deepen client relationships with model portfolios

Help keep clients on course with Vanguard model portfolios

Notes:

• For more information about Vanguard funds or Vanguard ETFs, visit advisors.vanguard.com or call 800-997-2798 to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.
• Vanguard ETF Shares are not redeemable with the issuing Fund other than in very large aggregations worth millions of dollars. Instead, investors must buy and sell Vanguard ETF Shares in the secondary market and hold those shares in a brokerage account. In doing so, the investor may incur brokerage commissions and may pay more than net asset value when buying and receive less than net asset value when selling.
• All investing is subject to risk, including possible loss of principal.
• Diversification does not ensure a profit or protect against a loss.
• Be aware that fluctuations in the financial markets and other factors may cause declines in the value of your account. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income.
• Vanguard does not, and will not, make any representations about whether a model portfolio is in the best interest of any investor, is not, and will not be, responsible for the determination of whether a model portfolio is in the best interests of any investor, and is not acting as an investment advisor to any investor. It is the investment advisor’s responsibility to determine the appropriateness of the model portfolios, or any of the securities included therein, for any client.
• The Vanguard model portfolios are provided for illustrative and educational purposes only. The Vanguard model portfolios do not constitute research, are not personalized investment advice or an investment recommendation from Vanguard to any client of a third party financial professional and are intended for use only by a third party financial professional, with other information, as a resource to help build a portfolio or as an input in the development of investment advice for its own clients. Such financial professionals are responsible for making their own independent judgment as to how to use the Vanguard model portfolios.