Semiannual Report  |  July 31, 2020
Vanguard Real Estate Index Funds
Vanguard Real Estate Index Fund
Vanguard Real Estate II Index Fund
See the inside front cover for important information about access to your fund’s annual and semiannual shareholder reports.

Important information about access to shareholder reports
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of your fund’s annual and semiannual shareholder reports will no longer be sent to you by mail, unless you specifically request them. Instead, you will be notified by mail each time a report is posted on the website and will be provided with a link to access the report.
If you have already elected to receive shareholder reports electronically, you will not be affected by this change and do not need to take any action. You may elect to receive shareholder reports and other communications from the fund electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, if you invest directly with the fund, by calling Vanguard at one of the phone numbers on the back cover of this report or by logging on to vanguard.com.
You may elect to receive paper copies of all future shareholder reports free of charge. If you invest through a financial intermediary, you can contact the intermediary to request that you continue to receive paper copies. If you invest directly with the fund, you can call Vanguard at one of the phone numbers on the back cover of this report or log on to vanguard.com. Your election to receive paper copies will apply to all the funds you hold through an intermediary or directly with Vanguard.
Contents

1

3

25

39

41

Table of Contents
About Your Fund’s Expenses
As a shareholder of the fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of the fund.
A fund‘s expenses are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.
The accompanying table illustrates your fund’s costs in two ways:
Based on actual fund return. This section helps you to estimate the actual expenses that you paid over the period. The ”Ending Account Value“ shown is derived from the fund’s actual return, and the third column shows the dollar amount that would have been paid by an investor who started with $1,000 in the fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your fund under the heading ”Expenses Paid During Period.“
Based on hypothetical 5% yearly return. This section is intended to help you compare your fund‘s costs with those of other mutual funds. It assumes that the fund had a yearly return of 5% before expenses, but that the expense ratio is unchanged. In this case—because the return used is not the fund’s actual return—the results do not apply to your investment. The example is useful in making comparisons because the Securities and Exchange Commission requires all mutual funds to calculate expenses based on a 5% return. You can assess your fund’s costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds.
Note that the expenses shown in the table are meant to highlight and help you compare ongoing costs only and do not reflect transaction costs incurred by the fund for buying and selling securities. Further, the expenses do not include any purchase, redemption, or account service fees described in the fund prospectus. If such fees were applied to your account, your costs would be higher. Your fund does not carry a “sales load.”
The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions.
You can find more information about the fund’s expenses, including annual expense ratios, in the Financial Statements section of this report. For additional information on operating expenses and other shareholder costs, please refer to your fund’s current prospectus.
1

Table of Contents
Six Months Ended July 31, 2020      
  Beginning
Account Value
1/31/2020
Ending
Account Value
7/31/2020
Expenses
Paid During
Period
Based on Actual Fund Return      
Real Estate Index Fund      
Investor Shares $1,000.00 $881.10 $1.22
ETF Shares 1,000.00 881.30 0.56
AdmiralTM Shares 1,000.00 881.70 0.56
Institutional Shares 1,000.00 882.00 0.47
Real Estate II Index Fund $1,000.00 $881.90 $0.37
Based on Hypothetical 5% Yearly Return      
Real Estate Index Fund      
Investor Shares $1,000.00 $1,023.57 $1.31
ETF Shares 1,000.00 1,024.27 0.60
Admiral Shares 1,000.00 1,024.27 0.60
Institutional Shares 1,000.00 1,024.37 0.50
Real Estate II Index Fund $1,000.00 $1,024.47 $0.40
The calculations are based on expenses incurred in the most recent six-month period. The funds’ annualized six-month expense ratios for that period are: for the Real Estate Index Fund, 0.26% for Investor Shares, 0.12% for ETF Shares, 0.12% for Admiral Shares, and 0.10% for Institutional Shares; and for the Real Estate II Index Fund, 0.08%. The dollar amounts shown as “Expenses Paid” are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent six-month period, then divided by the number of days in the most recent 12-month period (182/366).
2

Table of Contents
Real Estate Index Fund
Fund Allocation
As of July 31, 2020
Diversified Real Estate Activities 0.1%
Diversified REITs 3.5
Health Care REITs 8.3
Hotel & Resort REITs 2.2
Industrial REITs 11.9
Office REITs 7.9
Real Estate Development 0.2
Real Estate Operating Companies 0.2
Real Estate Services 2.4
Residential REITs 13.6
Retail REITs 8.0
Specialized REITs 41.7
The table reflects the fund’s investments, except for short-term investments and derivatives. Sector categories are based on the Global Industry Classification Standard (“GICS”), except for the “Other” category (if applicable), which includes securities that have not been provided a GICS classification as of the effective reporting period.
The fund may invest in derivatives (such as futures and swap contracts) for various reasons, including, but not limited to, attempting to remain fully invested and tracking their target index as closely as possible.
The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and Standard and Poor’s, a division of McGraw-Hill Companies, Inc. (“S&P”), and is licensed for use by Vanguard. Neither MSCI, S&P nor any third party involved in making or compiling the GICS or any GICS classification makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of its affiliates or any third party involved in making or compiling the GICS or any GICS classification have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.
3

Table of Contents
Real Estate Index Fund
Financial Statements (unaudited)
Schedule of Investments
As of July 31, 2020
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund’s Form N-PORT reports are available on the SEC’s website at www.sec.gov.
          Shares Market
Value

($000)
Equity Real Estate Investment Trusts (REITs) (96.9%)
Diversified REITs (3.0%)
WP Carey Inc.   7,692,257    548,996
VEREIT Inc.  48,029,316    312,671
STORE Capital Corp. Class A  10,340,574    244,968
PS Business Parks Inc.     917,760    126,605
Washington REIT   3,661,188     81,864
Global Net Lease Inc.   3,987,966     66,400
Essential Properties Realty Trust Inc.   4,097,660     65,972
American Assets Trust Inc.   2,276,364     61,462
Empire State Realty Trust Inc. Class A   6,824,509     45,042
Colony Capital Inc.  21,680,727     41,627
iStar Inc.   3,450,440     40,060
Alexander & Baldwin Inc.   3,057,804     36,143
Gladstone Commercial Corp.   1,514,348     27,561
Armada Hoffler Properties Inc.   2,515,674     24,251
One Liberty Properties Inc.     716,913     12,166
                     1,735,788
Health Care REITs (7.3%)
Welltower Inc.  18,305,435    980,439
Ventas Inc.  16,622,129    637,625
Healthpeak Properties Inc.  22,567,491    615,867
Medical Properties Trust Inc.  23,225,064    467,521
1 Omega Healthcare Investors Inc.  10,119,707    327,676
Healthcare Trust of America Inc. Class A   9,662,092    266,770
Healthcare Realty Trust Inc.   6,006,244    175,983
Physicians Realty Trust   8,785,492    158,490
Sabra Health Care REIT Inc.   9,150,824    134,883
          Shares Market
Value

($000)
National Health Investors Inc.   1,987,960    123,254
CareTrust REIT Inc.   4,255,423     76,683
LTC Properties Inc.   1,772,077     65,833
Community Healthcare Trust Inc.     917,292     41,948
Diversified Healthcare Trust  10,584,158     41,225
Universal Health Realty Income Trust     581,855     40,485
Global Medical REIT Inc.   1,837,049     21,842
New Senior Investment Group Inc.   3,699,740     12,579
                     4,189,103
Hotel & Resort REITs (2.0%)
Host Hotels & Resorts Inc.  31,468,953    339,235
MGM Growth Properties LLC Class A   5,855,024    160,076
Park Hotels & Resorts Inc.  10,697,126     88,465
Apple Hospitality REIT Inc.   9,480,499     83,618
Sunstone Hotel Investors Inc.  10,034,761     75,060
Ryman Hospitality Properties Inc.   2,324,643     74,435
Pebblebrook Hotel Trust   5,837,313     61,876
RLJ Lodging Trust   7,514,099     60,188
Service Properties Trust   7,330,141     49,112
DiamondRock Hospitality Co.   8,935,251     41,281
Xenia Hotels & Resorts Inc.   5,018,963     39,951
Summit Hotel Properties Inc.   4,694,123     24,316
Chatham Lodging Trust   2,093,970     10,910
CorePoint Lodging Inc.   1,817,300     10,159
Hersha Hospitality Trust Class A   1,560,148      7,426
4

Table of Contents
Real Estate Index Fund
          Shares Market
Value

($000)
Braemar Hotels & Resorts Inc.   1,337,057      3,262
1 Ashford Hospitality Trust Inc.     440,887      1,728
                     1,131,098
Industrial REITs (10.4%)
Prologis Inc.  32,947,206  3,473,295
Duke Realty Corp.  16,423,740    660,070
Americold Realty Trust   8,929,433    360,303
First Industrial Realty Trust Inc.   5,664,243    248,774
Rexford Industrial Realty Inc.   5,080,629    238,434
EastGroup Properties Inc.   1,734,678    230,122
STAG Industrial Inc.   6,630,097    216,141
Terreno Realty Corp.   3,004,727    182,567
Lexington Realty Trust  11,367,523    131,863
Innovative Industrial Properties Inc.     949,459     98,962
Industrial Logistics Properties Trust   2,904,592     61,316
Monmouth Real Estate Investment Corp.   4,143,951     59,797
                     5,961,644
Office REITs (6.9%)
Alexandria Real Estate Equities Inc.   5,472,539    971,649
Boston Properties Inc.   6,556,268    584,098
Vornado Realty Trust   7,249,508    250,253
Kilroy Realty Corp.   4,267,531    248,669
Douglas Emmett Inc.   7,428,990    216,481
Cousins Properties Inc.   6,543,683    201,022
Highwoods Properties Inc.   4,627,576    177,421
Equity Commonwealth   5,440,653    171,761
Hudson Pacific Properties Inc.   6,897,446    162,573
SL Green Realty Corp.   3,474,311    161,556
JBG SMITH Properties   5,413,217    157,037
Corporate Office Properties Trust   4,997,371    132,330
Piedmont Office Realty Trust Inc. Class A   5,613,175     90,990
Brandywine Realty Trust   7,866,929     85,199
Easterly Government Properties Inc.   3,346,813     81,830
Columbia Property Trust Inc.   5,134,696     61,411
Mack-Cali Realty Corp.   4,036,370     58,205
Paramount Group Inc.   8,109,413     57,820
Office Properties Income Trust   2,151,473     54,110
Franklin Street Properties Corp.   4,787,320     25,133
          Shares Market
Value

($000)
2 City Office REIT Inc.   2,436,092     21,072
*,3 New York REIT Liquidating LLC       1,208         15
                     3,970,635
Other (12.0%)4
5,6 Vanguard Real Estate II Index Fund 351,958,381  6,920,283
Residential REITs (11.9%)
AvalonBay Communities Inc.   6,274,667    960,777
Equity Residential  16,596,143    890,051
Invitation Homes Inc.  24,176,726    720,950
Essex Property Trust Inc.   2,950,339    651,258
Sun Communities Inc.   4,160,693    623,813
Mid-America Apartment Communities Inc.   5,095,557    607,339
Equity LifeStyle Properties Inc.   7,718,055    527,298
UDR Inc.  13,137,265    475,569
Camden Property Trust   4,340,631    394,173
American Homes 4 Rent Class A  12,042,566    349,234
Apartment Investment & Management Co. Class A   6,649,425    258,131
American Campus Communities Inc.   6,125,961    218,329
1 Independence Realty Trust Inc.   4,575,645     52,620
Investors Real Estate Trust     540,018     39,043
NexPoint Residential Trust Inc.     898,698     34,357
UMH Properties Inc.   1,640,812     20,182
Front Yard Residential Corp.   2,284,762     19,809
Preferred Apartment Communities Inc. Class A   2,072,063     14,981
                     6,857,914
Retail REITs (7.0%)
Realty Income Corp.  14,877,579    893,399
Simon Property Group Inc.  13,691,469    853,663
Regency Centers Corp.   7,483,564    307,051
1 National Retail Properties Inc.   7,654,694    271,359
Federal Realty Investment Trust   3,208,781    244,830
Kimco Realty Corp.  19,281,422    214,988
Spirit Realty Capital Inc.   4,570,521    157,500
Brixmor Property Group Inc.  13,285,373    152,915
Agree Realty Corp.   2,032,000    136,083
Taubman Centers Inc.   2,729,904    105,702
 
5

Table of Contents
Real Estate Index Fund
          Shares Market
Value

($000)
Weingarten Realty Investors   5,449,313     92,965
Retail Properties of America Inc. Class A   9,537,029     60,656
Urban Edge Properties   5,407,862     56,674
Retail Opportunity Investments Corp.   5,188,161     56,395
SITE Centers Corp.   6,911,627     50,662
Getty Realty Corp.   1,569,413     46,502
Acadia Realty Trust   3,656,758     44,027
1 Macerich Co.   5,031,302     38,389
Kite Realty Group Trust   3,748,161     36,994
American Finance Trust Inc. Class A   4,750,808     34,705
1 Tanger Factory Outlet Centers Inc.   4,145,795     26,657
Alexander's Inc.     102,590     25,831
RPT Realty   3,587,078     22,312
Saul Centers Inc.     618,596     18,997
Urstadt Biddle Properties Inc. Class A   1,337,328     13,119
Whitestone REIT   1,676,330     11,064
*,1 Seritage Growth Properties Class A   1,165,056     10,847
Retail Value Inc.     750,048      9,496
1 Washington Prime Group Inc.   8,382,785      6,152
1 Pennsylvania REIT   2,957,175      3,489
Cedar Realty Trust Inc.   3,939,568      3,205
*,3 Spirit MTA REIT   2,071,263      1,590
Urstadt Biddle Properties Inc.      16,033        136
                     4,008,354
Specialized REITs (36.4%)
American Tower Corp.  19,752,430  5,163,088
Crown Castle International Corp.  18,542,034  3,090,957
Equinix Inc.   3,810,203  2,992,838
1 Digital Realty Trust Inc.  11,080,576  1,778,876
SBA Communications Corp. Class A   4,991,850  1,555,161
Public Storage   6,814,617  1,362,106
Weyerhaeuser Co.  33,236,059    924,295
Extra Space Storage Inc.   5,531,814    571,658
CyrusOne Inc.   5,127,620    427,746
VICI Properties Inc.  17,886,485    388,316
1 Iron Mountain Inc.  12,829,154    361,654
Gaming & Leisure Properties Inc.   9,285,270    336,220
CubeSmart   8,644,199    256,473
Lamar Advertising Co. Class A   3,838,165    252,282
CoreSite Realty Corp.   1,680,607    216,882
Life Storage Inc.   2,082,240    204,330
QTS Realty Trust Inc. Class A   2,594,466    186,672
          Shares Market
Value

($000)
Rayonier Inc.   5,766,196    160,185
PotlatchDeltic Corp.   3,002,788    128,549
EPR Properties   3,502,805    100,285
Outfront Media Inc.   6,426,330     92,603
National Storage Affiliates Trust   2,660,550     81,998
Uniti Group Inc.   8,185,457     81,036
Four Corners Property Trust Inc.   3,121,177     78,654
GEO Group Inc.   5,403,577     57,440
CoreCivic Inc.   5,303,916     47,258
Safehold Inc.     533,175     26,888
CatchMark Timber Trust Inc. Class A   2,187,175     21,347
Jernigan Capital Inc.   1,036,961     14,528
CorEnergy Infrastructure Trust Inc.     612,228      5,363
                    20,965,688
Total Equity Real Estate Investment Trusts (REITs) (Cost $53,549,775) 55,740,507
Real Estate Management & Development (2.6%)
Diversified Real Estate Activities (0.1%)
* St. Joe Co.   1,458,382     30,057
RMR Group Inc. Class A     679,675     19,548
* Tejon Ranch Co.     988,012     14,178
* Five Point Holdings LLC Class A   2,304,242     11,060
                        74,843
Real Estate Development (0.2%)
* Howard Hughes Corp.   1,840,817     97,913
* Forestar Group Inc.     750,247     12,987
                       110,900
Real Estate Operating Companies (0.2%)
Kennedy-Wilson Holdings Inc.   5,708,119     84,708
Real Estate Services (2.1%)
* CBRE Group Inc. Class A  14,923,990    653,820
Jones Lang LaSalle Inc.   2,301,458    227,637
* Redfin Corp.   3,243,793    134,877
* Cushman & Wakefield plc   4,881,688     52,234
Realogy Holdings Corp.   5,104,992     46,251
* Marcus & Millichap Inc.   1,048,441     28,560
Newmark Group Inc. Class A   6,726,252     27,376
RE/MAX Holdings Inc. Class A     799,352     25,875
*,1 eXp World Holdings Inc.   1,154,814     22,946
*,1 Altisource Portfolio Solutions SA     241,388      3,242
                     1,222,818
Total Real Estate Management & Development (Cost $2,034,350) 1,493,269
 
6

Table of Contents
Real Estate Index Fund
          Shares Market
Value

($000)
Temporary Cash Investments (0.8%)
Money Market Fund (0.8%)
7,8 Vanguard Market Liquidity Fund, 0.194%
(Cost $435,765)
  4,358,859           435,886
Total Investments (100.3%) (Cost $56,019,890)   57,669,662
Other Assets and Liabilities—Net (-0.3%)   (169,296)
Net Assets (100%)   57,500,366
Cost is in $000.
See Note A in Notes to Financial Statements.
* Non-income-producing security.
1 Includes partial security positions on loan to broker-dealers. The total value of securities on loan is $198,169,000.
2 Considered an affiliated company of the fund as the fund owns more than 5% of the outstanding voting securities of such company.
3 Security value determined using significant unobservable inputs.
4 “Other” represents securities that are not classified by the fund’s benchmark index.
5 Considered an affiliated company of the fund as the issuer is another member of The Vanguard Group.
6 Represents a wholly owned subsidiary of the fund. See accompanying financial statements for Vanguard Real Estate II Index Fund's Schedule of Investments.
7 Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield.
8 Collateral of $216,429,000 was received for securities on loan.
    
  REIT—Real Estate Investment Trust.

Derivative Financial Instruments Outstanding as of Period End

Over-the-Counter Total Return Swaps
Reference Entity Termination
Date
Counterparty Notional
Amount
($000)
Floating
Interest
Rate
Received
(Paid)1
(%)
Value and
Unrealized
Appreciation
($000)
Value and
Unrealized
(Depreciation)
($000)
Digital Realty Trust Inc. 2/2/21 GSI 91,404 (0.181) 10,373
Extra Space Storage Inc. 2/2/21 GSI 24,520 (0.181) 1,313
Hannon Armstrong Sustainable Infrastructure Capital Inc. 2/2/21 GSI 6,682 (0.181) 324
7

Table of Contents
Real Estate Index Fund
Over-the-Counter Total Return Swaps (continued)
Reference Entity Termination
Date
Counterparty Notional
Amount
($000)
Floating
Interest
Rate
Received
(Paid)1
(%)
Value and
Unrealized
Appreciation
($000)
Value and
Unrealized
(Depreciation)
($000)
Public Storage 2/2/21 GSI 38,560 (0.181) 1,413
Redfin Corp. 2/2/21 GSI 26,096 (0.181) 3,008
Seritage Growth Properties 2/2/21 GSI 4,261 (0.181) (574)
VICI Properties Inc. 2/2/21 GSI 63,570 (0.181) 1,555
          17,986 (574)
1 Based on 1-month USD London Interbank Offered Rate (LIBOR) as of the most recent payment date. Floating interest payment received/paid monthly.
GSI—Goldman Sachs International.
At July 31, 2020, counterparties had deposited in a segregated account securities with a value of $17,070,000 in connection with open over-the-counter swap contracts.
See accompanying Notes, which are an integral part of the Financial Statements.
8

Table of Contents
Real Estate Index Fund
Statement of Assets and Liabilities
As of July 31, 2020
($000s, except shares and per-share amounts) Amount
Assets  
Investments in Securities, at Value  
Unaffiliated Issuers (Cost $48,710,630) 50,292,421
Affiliated Issuers (Cost $464,603) 456,958
Vanguard Real Estate II Index Fund (Cost $6,844,657) 6,920,283
Total Investments in Securities 57,669,662
Investment in Vanguard 2,185
Cash 28,790
Receivables for Investment Securities Sold 23,987
Receivables for Accrued Income 21,316
Receivables for Capital Shares Issued 17,924
Unrealized Appreciation—Over-the-Counter Swap Contracts 17,986
Total Assets 57,781,850
Liabilities  
Payables for Investment Securities Purchased 29,848
Collateral for Securities on Loan 216,429
Payables for Capital Shares Redeemed 31,555
Payables to Vanguard 3,078
Unrealized Depreciation—Over-the-Counter Swap Contracts 574
Total Liabilities 281,484
Net Assets 57,500,366
9

Table of Contents
Real Estate Index Fund
Statement of Assets and Liabilities (continued)

At July 31, 2020, net assets consisted of:  
($000s, except shares and per-share amounts) Amount
Paid-in Capital 56,918,260
Total Distributable Earnings (Loss) 582,106
Net Assets 57,500,366
 
Investor Shares—Net Assets  
Applicable to 7,026,537 outstanding $.001 par value shares of beneficial interest (unlimited authorization) 189,974
Net Asset Value Per Share—Investor Shares $27.04
 
ETF Shares—Net Assets  
Applicable to 358,425,632 outstanding $.001 par value shares of beneficial interest (unlimited authorization) 29,166,021
Net Asset Value Per Share—ETF Shares $81.37
 
Admiral Shares—Net Assets  
Applicable to 166,680,355 outstanding $.001 par value shares of beneficial interest (unlimited authorization) 19,222,325
Net Asset Value Per Share—Admiral Shares $115.32
 
Institutional Shares—Net Assets  
Applicable to 499,855,848 outstanding $.001 par value shares of beneficial interest (unlimited authorization) 8,922,046
Net Asset Value Per Share—Institutional Shares $17.85
See accompanying Notes, which are an integral part of the Financial Statements.
10

Table of Contents
Real Estate Index Fund
Statement of Operations
  Six Months Ended
July 31, 2020
  ($000)
Investment Income  
Income  
Dividends—Unaffiliated Issuers 720,724
Dividends—Affiliated Issuers 5,368
Dividends—Vanguard Real Estate II Index Fund 104,882
Interest—Affiliated Issuers 549
Securities Lending—Net 4,353
Total Income 835,876
Expenses  
The Vanguard Group—Note B  
Investment Advisory Services 1,373
Management and Administrative—Investor Shares 224
Management and Administrative—ETF Shares 14,707
Management and Administrative—Admiral Shares 9,773
Management and Administrative—Institutional Shares 3,636
Marketing and Distribution—Investor Shares 13
Marketing and Distribution—ETF Shares 697
Marketing and Distribution—Admiral Shares 523
Marketing and Distribution—Institutional Shares 132
Custodian Fees 209
Shareholders’ Reports—Investor Shares 7
Shareholders’ Reports—ETF Shares 931
Shareholders’ Reports—Admiral Shares 233
Shareholders’ Reports—Institutional Shares 64
Trustees’ Fees and Expenses 20
Total Expenses 32,542
Expenses Paid Indirectly (124)
Net Expenses 32,418
Net Investment Income 803,458
Realized Net Gain (Loss)  
Capital Gain Distributions Received—Unaffiliated Issuers 93,272
Capital Gain Distributions Received—Affiliated Issuers 795
Capital Gain Distributions Received—Vanguard Real Estate II Index Fund
Investment Securities Sold—Unaffiliated Issuers1 513,276
Investment Securities Sold—Affiliated Issuers1 (36,067)
Investment Securities Sold—Vanguard Real Estate II Index Fund
Futures Contracts (3,901)
Swap Contracts (6,284)
Realized Net Gain (Loss) 561,091
11

Table of Contents
Real Estate Index Fund
Statement of Operations (continued)
  Six Months Ended
July 31, 2020
  ($000)
Change in Unrealized Appreciation (Depreciation)  
Investment Securities—Unaffiliated Issuers (9,438,525)
Investment Securities—Affiliated Issuers (172,756)
Investment Securities—Vanguard Real Estate II Index Fund (1,032,220)
Swap Contracts 18,863
Change in Unrealized Appreciation (Depreciation) (10,624,638)
Net Increase (Decrease) in Net Assets Resulting from Operations (9,260,089)
1 Includes $1,333,090,000 of the net gain (loss) resulting from in-kind redemptions.
See accompanying Notes, which are an integral part of the Financial Statements.
12

Table of Contents
Real Estate Index Fund
Statement of Changes in Net Assets
  Six Months Ended
July 31,
2020
  Year Ended
January 31,
2020
  ($000)   ($000)
Increase (Decrease) in Net Assets      
Operations      
Net Investment Income 803,458   1,726,391
Realized Net Gain (Loss) 561,091   2,458,391
Change in Unrealized Appreciation (Depreciation) (10,624,638)   5,911,672
Net Increase (Decrease) in Net Assets Resulting from Operations (9,260,089)   10,096,454
Distributions1      
Investor Shares (3,308)   (22,650)
ETF Shares (530,941)   (921,879)
Admiral Shares (339,878)   (554,006)
Institutional Shares (151,945)   (244,373)
Return of Capital      
Investor Shares   (7,475)
ETF Shares   (304,249)
Admiral Shares   (182,839)
Institutional Shares   (80,651)
Total Distributions (1,026,072)   (2,318,122)
Capital Share Transactions      
Investor Shares (19,424)   (1,748,144)
ETF Shares (2,811,487)   2,721,882
Admiral Shares (820,154)   2,583,346
Institutional Shares 211,313   734,197
Net Increase (Decrease) from Capital Share Transactions (3,439,752)   4,291,281
Total Increase (Decrease) (13,725,913)   12,069,613
Net Assets      
Beginning of Period 71,226,279   59,156,666
End of Period 57,500,366   71,226,279
1 Certain prior period numbers have been reclassed to conform with current period presentation.
See accompanying Notes, which are an integral part of the Financial Statements.
13

Table of Contents
Real Estate Index Fund
Financial Highlights
Investor Shares            
For a Share Outstanding
Throughout Each Period
Six Months
Ended
July 31,
2020
Year Ended January 31,
2020 2019 2018 2017 2016
Net Asset Value, Beginning of Period $31.21 $27.69 $26.40 $27.38 $25.59 $28.73
Investment Operations            
Net Investment Income .3461 .7191 .7871 .7611 .746 .711
Net Realized and Unrealized Gain (Loss) on Investments (4.070) 3.801 1.639 (.614) 2.324 (2.851)
Total from Investment Operations (3.724) 4.520 2.426 .147 3.070 (2.140)
Distributions            
Dividends from Net Investment Income (.446) (.752) (.851) (.788) (.752) (.695)
Distributions from Realized Capital Gains (.011) (.187)
Return of Capital (.248) (.285) (.328) (.341) (.305)
Total Distributions (.446) (1.000) (1.136) (1.127) (1.280) (1.000)
Net Asset Value, End of Period $27.04 $31.21 $27.69 $26.40 $27.38 $25.59
Total Return2 -11.89% 16.59% 9.53% 0.45% 12.07% -7.44%
Ratios/Supplemental Data            
Net Assets, End of Period (Millions) $190 $243 $1,871 $2,143 $2,603 $2,621
Ratio of Total Expenses to Average Net Assets 0.26% 0.26% 0.25% 0.26% 0.26% 0.26%
Ratio of Net Investment Income to Average Net Assets 2.63% 2.48% 3.02% 2.87% 2.60% 2.66%
Portfolio Turnover Rate3 3% 6% 24% 6% 7% 11%
The expense ratio and net investment income ratio for the current period have been annualized.
1 Calculated based on average shares outstanding.
2 Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees.
3 Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including ETF Creation Units.
See accompanying Notes, which are an integral part of the Financial Statements.
14

Table of Contents
Real Estate Index Fund
Financial Highlights
ETF Shares            
For a Share Outstanding
Throughout Each Period
Six Months
Ended
July 31,
2020
Year Ended January 31,
2020 2019 2018 2017 2016
Net Asset Value, Beginning of Period $93.93 $83.36 $79.47 $82.43 $77.05 $86.49
Investment Operations            
Net Investment Income 1.1121 2.3351 2.4871 2.4991 2.334 2.217
Net Realized and Unrealized Gain (Loss) on Investments (12.265) 11.379 4.934 (1.945) 7.022 (8.533)
Total from Investment Operations (11.153) 13.714 7.421 .554 9.356 (6.316)
Distributions            
Dividends from Net Investment Income (1.407) (2.364) (2.646) (2.458) (2.353) (2.170)
Distributions from Realized Capital Gains (.034) (.563)
Return of Capital (.780) (.885) (1.022) (1.060) (.954)
Total Distributions (1.407) (3.144) (3.531) (3.514) (3.976) (3.124)
Net Asset Value, End of Period $81.37 $93.93 $83.36 $79.47 $82.43 $77.05
Total Return -11.87% 16.70% 9.70% 0.59% 12.25% -7.31%
Ratios/Supplemental Data            
Net Assets, End of Period (Millions) $29,166 $37,682 $30,857 $32,377 $33,527 $27,007
Ratio of Total Expenses to Average Net Assets 0.12% 0.12% 0.12% 0.12% 0.12% 0.12%
Ratio of Net Investment Income to Average Net Assets 2.80% 2.60% 3.15% 3.01% 2.74% 2.80%
Portfolio Turnover Rate2 3% 6% 24% 6% 7% 11%
The expense ratio and net investment income ratio for the current period have been annualized.
1 Calculated based on average shares outstanding.
2 Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including ETF Creation Units.
See accompanying Notes, which are an integral part of the Financial Statements.
15

Table of Contents
Real Estate Index Fund
Financial Highlights
Admiral Shares            
For a Share Outstanding
Throughout Each Period
Six Months
Ended
July 31,
2020
Year Ended January 31,
2020 2019 2018 2017 2016
Net Asset Value, Beginning of Period $133.12 $118.14 $112.63 $116.83 $109.19 $122.58
Investment Operations            
Net Investment Income 1.5551 3.3151 3.5071 3.5381 3.306 3.142
Net Realized and Unrealized Gain (Loss) on Investments (17.362) 16.121 7.008 (2.761) 9.966 (12.105)
Total from Investment Operations (15.807) 19.436 10.515 .777 13.272 (8.963)
Distributions            
Dividends from Net Investment Income (1.993) (3.350) (3.751) (3.483) (3.333) (3.076)
Distributions from Realized Capital Gains (.048) (.798)
Return of Capital (1.106) (1.254) (1.447) (1.501) (1.351)
Total Distributions (1.993) (4.456) (5.005) (4.978) (5.632) (4.427)
Net Asset Value, End of Period $115.32 $133.12 $118.14 $112.63 $116.83 $109.19
Total Return2 -11.83% 16.73% 9.69% 0.58% 12.23% -7.30%
Ratios/Supplemental Data            
Net Assets, End of Period (Millions) $19,222 $23,274 $18,223 $17,757 $18,337 $15,029
Ratio of Total Expenses to Average Net Assets 0.12% 0.12% 0.11% 0.12% 0.12% 0.12%
Ratio of Net Investment Income to Average Net Assets 2.77% 2.60% 3.16% 3.01% 2.74% 2.80%
Portfolio Turnover Rate3 3% 6% 24% 6% 7% 11%
The expense ratio and net investment income ratio for the current period have been annualized.
1 Calculated based on average shares outstanding.
2 Total returns do not include account service fees that may have applied in the periods shown. Fund prospectuses provide information about any applicable account service fees.
3 Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including ETF Creation Units.
See accompanying Notes, which are an integral part of the Financial Statements.
16

Table of Contents
Real Estate Index Fund
Financial Highlights
Institutional Shares            
For a Share Outstanding
Throughout Each Period
Six Months
Ended
July 31,
2020
Year Ended January 31,
2020 2019 2018 2017 2016
Net Asset Value, Beginning of Period $20.60 $18.28 $17.43 $18.08 $16.90 $18.97
Investment Operations            
Net Investment Income .2421 .5181 .5431 .5681 .515 .489
Net Realized and Unrealized Gain (Loss) on Investments (2.682) 2.496 1.085 (.444) 1.540 (1.870)
Total from Investment Operations (2.440) 3.014 1.628 .124 2.055 (1.381)
Distributions            
Dividends from Net Investment Income (.310) (.522) (.583) (.542) (.519) (.479)
Distributions from Realized Capital Gains (.007) (.123)
Return of Capital (.172) (.195) (.225) (.233) (.210)
Total Distributions (.310) (.694) (.778) (.774) (.875) (.689)
Net Asset Value, End of Period $17.85 $20.60 $18.28 $17.43 $18.08 $16.90
Total Return -11.80% 16.77% 9.70% 0.60% 12.23% -7.27%
Ratios/Supplemental Data            
Net Assets, End of Period (Millions) $8,922 $10,027 $8,206 $8,176 $7,799 $6,785
Ratio of Total Expenses to Average Net Assets 0.10% 0.10% 0.09% 0.10% 0.10% 0.10%
Ratio of Net Investment Income to Average Net Assets 2.79% 2.63% 3.18% 3.03% 2.76% 2.82%
Portfolio Turnover Rate2 3% 6% 24% 6% 7% 11%
The expense ratio and net investment income ratio for the current period have been annualized.
1 Calculated based on average shares outstanding.
2 Excludes the value of portfolio securities received or delivered as a result of in-kind purchases or redemptions of the fund’s capital shares, including ETF Creation Units.
See accompanying Notes, which are an integral part of the Financial Statements.
17

Table of Contents
Real Estate Index Fund
Notes to Financial Statements
Vanguard Real Estate Index Fund is registered under the Investment Company Act of 1940 as an open-end investment company, or mutual fund. The fund offers four classes of shares: Investor Shares, ETF Shares, Admiral Shares, and Institutional Shares. Each of the share classes has different eligibility and minimum purchase requirements, and is designed for different types of investors. ETF Shares are listed for trading on NYSE Arca; they can be purchased and sold through a broker.
As a part of its principal investment strategy, the fund attempts to replicate its benchmark index by investing all, or substantially all, of its assets --either directly or indirectly through a wholly owned subsidiary --in the stocks that make up the index. Vanguard Real Estate II Index Fund is the wholly owned subsidiary in which the fund has invested a portion of its assets. For additional financial information about the Real Estate II Index Fund, refer to the accompanying financial statements.
Market disruptions associated with the COVID-19 pandemic have had a global impact, and uncertainty exists as to the long-term implications. Such disruptions can adversely affect assets of the fund and thus fund performance.
A. The following significant accounting policies conform to generally accepted accounting principles for U.S. investment companies. The fund consistently follows such policies in preparing its financial statements.
1. Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4 p.m., Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been materially affected by events occurring before the fund's pricing time but after the close of the securities’ primary markets, are valued by methods deemed by the board of trustees to represent fair value. Investments in affiliated Vanguard funds are valued at that fund's net asset value.
2. Futures Contracts: The fund uses index futures contracts to a limited extent, with the objectives of maintaining full exposure to the stock market, maintaining liquidity, and minimizing transaction costs. The fund 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 primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks held by the fund and the prices of futures contracts, and the possibility of an illiquid market. Counterparty risk involving futures is mitigated because a regulated clearinghouse is the counterparty instead of the clearing broker. To further mitigate counterparty risk, the fund trades futures contracts on an exchange, monitors the financial strength of its clearing brokers and clearinghouse, and has entered into clearing agreements with its clearing brokers. The clearinghouse imposes initial margin requirements to secure the fund’s performance and requires daily settlement of variation margin representing changes in the market value of each contract. Any assets pledged as initial margin for open contracts are noted in the Schedule of Investments.
Futures contracts are valued at their quoted daily settlement prices. The notional amounts of the contracts are not recorded in the Schedule of Investments. Fluctuations in the value of the contracts are recorded in the Statement of Assets and Liabilities as an asset (liability) and in the
18

Table of Contents
Real Estate Index Fund
Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized gains (losses) on futures contracts.
During the six months ended July 31, 2020, the fund’s average investments in long and short futures contracts represented less than 1% and 0% of net assets, respectively, based on the average of the notional amounts at each quarter-end during the period. The fund had no open futures contracts at July 31, 2020.
3. Swap Contracts: The fund has entered into equity swap contracts to earn the total return on selected reference stocks in the fund’s target index. Under the terms of the swaps, the fund receives the total return on the referenced stock (i.e., receiving the increase or paying the decrease in value of the selected reference stock and receiving the equivalent of any dividends in respect of the selected referenced stock) over a specified period of time, applied to a notional amount that represents the value of a designated number of shares of the selected reference stock at the beginning of the equity swap contract. The fund also pays a floating rate that is based on short-term interest rates, applied to the notional amount. At the same time, the fund generally invests an amount approximating the notional amount of the swap in high-quality temporary cash investments.
The notional amounts of swap contracts are not recorded in the Schedule of Investments. Swaps are valued daily based on market quotations received from independent pricing services or recognized dealers and the change in value is recorded in the Statement of Assets and Liabilities as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until periodic payments are made or the termination of the swap, at which time realized gain (loss) is recorded.
A risk associated with all types of swaps is the possibility that a counterparty may default on its obligation to pay net amounts due to the fund. The fund’s maximum amount subject to counterparty risk is the unrealized appreciation on the swap contract. The fund mitigates its counterparty risk by entering into swaps only with a diverse group of prequalified counterparties, monitoring their financial strength, entering into master netting arrangements with its counterparties, and requiring its counterparties to transfer collateral as security for their performance. In the absence of a default, the collateral pledged or received by the fund cannot be repledged, resold, or rehypothecated. In the event of a counterparty’s default (including bankruptcy), the fund may terminate any swap contracts with that counterparty, determine the net amount owed by either party in accordance with its master netting arrangements, and sell or retain any collateral held up to the net amount owed to the fund under the master netting arrangements. The swap contracts contain provisions whereby a counterparty may terminate open contracts if the fund's net assets decline below a certain level, triggering a payment by the fund if the fund is in a net liability position at the time of the termination. The payment amount would be reduced by any collateral the fund has pledged. Any securities pledged as collateral for open contracts are noted in the Schedule of Investments. The value of collateral received or pledged is compared daily to the value of the swap contracts exposure with each counterparty, and any difference, if in excess of a specified minimum transfer amount, is adjusted and settled within two business days.
During the six months ended July 31, 2020, the fund’s average amounts of investments in total return swaps represented less than 1% of net assets, based on the average of notional amounts at each quarter-end during the period.
19

Table of Contents
Real Estate Index Fund
4. Federal Income Taxes: The fund intends to continue to qualify as a regulated investment company and distribute all of its taxable income. Management has analyzed the fund’s tax positions taken for all open federal income tax years (January 31, 2017–2020), and for the period ended July 31, 2020, and has concluded that no provision for federal income tax is required in the fund’s financial statements.
5. Distributions: Distributions to shareholders are recorded on the ex-dividend date. The portion of distributions that exceed a fund's current and accumulated earnings and profits, as measured on a tax basis, constitute a non-taxable return of capital. Distributions are determined on a tax basis at the fiscal year-end and may differ from net investment income and realized capital gains for financial reporting purposes.
6. Securities Lending: To earn additional income, the fund lends its securities to qualified institutional borrowers. Security loans are subject to termination by the fund at any time, and are required to be secured at all times by collateral in an amount at least equal to the market value of securities loaned. Daily market fluctuations could cause the value of loaned securities to be more or less than the value of the collateral received. When this occurs, the collateral is adjusted and settled before the opening of the market on the next business day. The fund further mitigates its counterparty risk by entering into securities lending transactions only with a diverse group of prequalified counterparties, monitoring their financial strength, and entering into master securities lending agreements with its counterparties. The master securities lending agreements provide that, in the event of a counterparty’s default (including bankruptcy), the fund may terminate any loans with that borrower, determine the net amount owed, and sell or retain the collateral up to the net amount owed to the fund; however, such actions may be subject to legal proceedings. While collateral mitigates counterparty risk, in the event of a default, the fund may experience delays and costs in recovering the securities loaned. The fund invests cash collateral received in Vanguard Market Liquidity Fund, and records a liability in the Statement of Assets and Liabilities for the return of the collateral, during the period the securities are on loan. Collateral investments in Vanguard Market Liquidity Fund are subject to market appreciation or depreciation. Securities lending income represents fees charged to borrowers plus income earned on invested cash collateral, less expenses associated with the loan. During the term of the loan, the fund is entitled to all distributions made on or in respect of the loaned securities.
7. Credit Facilities and Interfund Lending Program: The fund and certain other funds managed by The Vanguard Group ("Vanguard") participate in a $4.3 billion committed credit facility provided by a syndicate of lenders pursuant to a credit agreement and an uncommitted credit facility provided by Vanguard. Both facilities may be renewed annually. Each fund is individually liable for its borrowings, if any, under the credit facilities. Borrowings may be utilized for temporary or emergency purposes, subject to the fund’s regulatory and contractual borrowing restrictions. With respect to the committed credit facility, the participating funds are charged administrative fees and an annual commitment fee of 0.10% of the undrawn committed amount of the facility; these fees are allocated to the funds based on a method approved by the fund’s board of trustees and included in Management and Administrative expenses on the fund’s Statement of Operations. Any borrowings under either facility bear interest at a rate based upon the higher of the one-month London Interbank Offered Rate (or an acceptable alternate rate, if necessary), federal funds effective rate, or overnight bank funding rate plus an agreed-upon spread, except that borrowings under the uncommitted credit facility may bear interest based upon an alternative rate agreed to by the fund and Vanguard.
20

Table of Contents
Real Estate Index Fund
In accordance with an exemptive order (the “Order”) from the SEC, the fund may participate in a joint lending and borrowing program that allows registered open-end Vanguard funds to borrow money from and lend money to each other for temporary or emergency purposes (the “Interfund Lending Program”), subject to compliance with the terms and conditions of the Order, and to the extent permitted by the fund’s investment objective and investment policies. Interfund loans and borrowings normally extend overnight, but can have a maximum duration of seven days. Loans may be called on one business day’s notice. The interest rate to be charged is governed by the conditions of the Order and internal procedures adopted by the board of trustees. The board of trustees is responsible for overseeing the Interfund Lending Program.
For the six months ended July 31, 2020, the fund did not utilize the credit facilities or the Interfund Lending Program.
8. Other: Distributions received from investment securities are recorded on the ex-dividend date. Each investment security reports annually the tax character of its distributions. Dividend income, capital gain distributions received, and unrealized appreciation (depreciation) reflect the amounts of taxable income, capital gain, and return of capital reported by the investment securities, and management’s estimates of such amounts for investment security distributions for which actual information has not been reported. Income, capital gain, and return of capital distributions received from affiliated Vanguard funds are recorded on ex-dividend date. Interest income includes income distributions received from Vanguard Market Liquidity Fund and is accrued daily. Security transactions are accounted for on the date securities are bought or sold. Costs used to determine realized gains (losses) on the sale of investment securities are those of the specific securities sold.
Each class of shares has equal rights as to assets and earnings, except that each class separately bears certain class-specific expenses related to maintenance of shareholder accounts (included in Management and Administrative expenses) and shareholder reporting. Marketing and distribution expenses are allocated to each class of shares based on a method approved by the board of trustees. Income, other non-class-specific expenses, and gains and losses on investments are allocated to each class of shares based on its relative net assets.
B. In accordance with the terms of a Funds’ Service Agreement (the “FSA”) between Vanguard and the fund, Vanguard furnishes to the fund investment advisory, corporate management, administrative, marketing, and distribution services at Vanguard’s cost of operations (as defined by the FSA). These costs of operations are allocated to the fund based on methods and guidelines approved by the board of trustees and are generally settled twice a month.
Upon the request of Vanguard, the fund may invest up to 0.40% of its net assets as capital in Vanguard. At July 31, 2020, the fund had contributed to Vanguard capital in the amount of $2,185,000, representing less than 0.01% of the fund’s net assets and 0.87% of Vanguard’s capital received pursuant to the FSA. The fund’s trustees and officers are also directors and employees, respectively, of Vanguard.
C. The fund’s custodian bank has agreed to reduce its fees when the fund maintains cash on deposit in the non-interest-bearing custody account. For the six months ended July 31, 2020, custodian fee offset arrangements reduced the fund’s expenses by $124,000 (an annual rate of less than 0.01% of average net assets).
21

Table of Contents
Real Estate Index Fund
D. Various inputs may be used to determine the value of the fund’s investments. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.
Level 1—Quoted prices in active markets for identical securities.
Level 2—Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3—Significant unobservable inputs (including the fund’s own assumptions used to determine the fair value of investments). Any investments valued with significant unobservable inputs are noted on the Schedule of Investments.
The following table summarizes the market value of the fund's investments and derivatives as of July 31, 2020, based on the inputs used to value them:
  Level 1
($000)
Level 2
($000)
Level 3
($000)
Total
($000)
Investments        
Assets        
Common Stocks 57,232,171 1,605 57,233,776
Temporary Cash Investments 435,886 435,886
Total 57,668,057 1,605 57,669,662
Derivative Financial Instruments        
Assets        
Swap Contracts 17,986 17,986
Liabilities        
Swap Contracts 574 574
E. As of July 31, 2020, gross unrealized appreciation and depreciation for investments and derivatives based on cost for U.S. federal income tax purposes were as follows:
  Amount
($000)
Tax Cost 56,110,995
Gross Unrealized Appreciation 11,388,681
Gross Unrealized Depreciation (9,812,602)
Net Unrealized Appreciation (Depreciation) 1,576,079
The fund’s tax-basis capital gains and losses are determined only at the end of each fiscal year. For tax purposes, at January 31, 2020, the fund had available capital losses totaling $1,509,620,000 that may be carried forward indefinitely to offset future net capital gains. The fund will use these capital losses to offset net taxable capital gains, if any, realized during the year ending January 31, 2021; should the fund realize net capital losses for the year, the losses will be added to the loss carryforward balance above.
22

Table of Contents
Real Estate Index Fund
F. During the six months ended July 31, 2020, the fund purchased $5,773,862,000 of investment securities and sold $9,314,536,000 of investment securities, other than temporary cash investments. Purchases and sales include $3,767,593,000 and $6,607,729,000, respectively, in connection with in-kind purchases and redemptions of the fund’s capital shares.
G. Capital share transactions for each class of shares were:
    
  Six Months Ended
July 31, 2020
  Year Ended
January 31, 2020
  Amount
($000)
Shares
(000)
  Amount
($000)
Shares
(000)
Investor Shares          
Issued 9,259 341   395,906 13,631
Issued in Lieu of Cash Distributions 3,308 125   28,280 981
Redeemed1 (31,991) (1,233)   (2,172,330) (74,391)
Net Increase (Decrease)—Investor Shares (19,424) (767)   (1,748,144) (59,779)
ETF Shares          
Issued 4,140,510 47,351   10,501,566 118,494
Issued in Lieu of Cash Distributions  
Redeemed (6,951,997) (90,100)   (7,779,684) (87,500)
Net Increase (Decrease)—ETF Shares (2,811,487) (42,749)   2,721,882 30,994
Admiral Shares          
Issued1 1,753,770 15,842   5,327,904 42,120
Issued in Lieu of Cash Distributions 298,052 2,644   647,759 5,156
Redeemed (2,871,976) (26,638)   (3,392,317) (26,697)
Net Increase (Decrease)—Admiral Shares (820,154) (8,152)   2,583,346 20,579
Institutional Shares          
Issued 940,012 55,794   2,004,257 102,367
Issued in Lieu of Cash Distributions 143,493 8,234   306,680 15,790
Redeemed (872,192) (50,829)   (1,576,740) (80,293)
Net Increase (Decrease)—Institutional Shares 211,313 13,199   734,197 37,864
1 In November 2018, the fund announced changes to the availability and minimum investment criteria of the Investor and Admiral share classes. As a result, all of the outstanding Investor Shares automatically converted to Admiral Shares beginning in April 2019, with the exception of those held by Vanguard funds and certain other institutional investors. Investor Shares—Redeemed and Admiral Shares—Issued include 57,968,000 and 13,589,000 shares, respectively, in the amount of $1,688,895,000 from the conversion during the year ended January 31, 2020.
23

Table of Contents
Real Estate Index Fund
H. Certain of the fund’s investments are in companies that are considered to be affiliated companies of the fund because the fund owns more than 5% of the outstanding voting securities of the company or the issuer is another member of The Vanguard Group. Transactions during the period in securities of these companies were as follows:
    Current Period Transactions  
  Jan. 31, 2020
Market Value
($000)
Purchases
at Cost
($000)
Proceeds
from
Securities
Sold1
($000)
Realized
Net Gain
(Loss)
($000)
Change in
Unrealized
App. (Dep.)
($000)
Income
($000)
Capital Gain
Distributions
Received
($000)
Jul. 31, 2020
Market Value
($000)
City Office REIT Inc. NA2 2,129 5,161 (719) (11,142) 21,072
Host Hotels & Resorts Inc. 586,395 38,120 88,109 (34,634) (162,537) 5,368 795 NA3
Vanguard Market Liquidity Fund 561,293 NA4 NA4 156 53 549 435,886
Vanguard Real Estate II Index Fund 7,847,621 104,882 (1,032,220) 104,882 6,920,283
Winthrop Realty Trust (870) 870
Total 8,995,309 145,131 93,270 (36,067) (1,204,976) 110,799 795 7,377,241
1 Does not include adjustments related to return of capital.
2 Not applicable—at January 31, 2020, the issuer was not an affiliated company of the fund.
3 Not applicable—at July 31, 2020, the security was still held, but the issuer was no longer an affiliated company of the fund.
4 Not applicable—purchases and sales are for temporary cash investment purposes.
I. Management has determined that no events or transactions occurred subsequent to July 31, 2020, that would require recognition or disclosure in these financial statements.
24

Table of Contents
Real Estate II Index Fund
Fund Allocation
As of July 31, 2020
Diversified Real Estate Activities 0.2%
Diversified REITs 3.4
Health Care REITs 8.3
Hotel & Resort REITs 2.2
Industrial REITs 11.8
Office REITs 7.9
Real Estate Development 0.2
Real Estate Operating Companies 0.2
Real Estate Services 2.5
Residential REITs 13.6
Retail REITs 7.9
Specialized REITs 41.8
The table reflects the fund’s investments, except for short-term investments and derivatives. Sector categories are based on the Global Industry Classification Standard (“GICS”), except for the “Other” category (if applicable), which includes securities that have not been provided a GICS classification as of the effective reporting period.
The fund may invest in derivatives (such as futures and swap contracts) for various reasons, including, but not limited to, attempting to remain fully invested and tracking their target index as closely as possible.
The Global Industry Classification Standard (“GICS”) was developed by and is the exclusive property and a service mark of MSCI Inc. (“MSCI”) and Standard and Poor’s, a division of McGraw-Hill Companies, Inc. (“S&P”), and is licensed for use by Vanguard. Neither MSCI, S&P nor any third party involved in making or compiling the GICS or any GICS classification makes any express or implied warranties or representations with respect to such standard or classification (or the results to be obtained by the use thereof), and all such parties hereby expressly disclaim all warranties of originality, accuracy, completeness, merchantability or fitness for a particular purpose with respect to any such standard or classification. Without limiting any of the foregoing, in no event shall MSCI, S&P, any of its affiliates or any third party involved in making or compiling the GICS or any GICS classification have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.
25

Table of Contents
Real Estate II Index Fund
Financial Statements (unaudited)
Schedule of Investments
As of July 31, 2020
The fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund’s Form N-PORT reports are available on the SEC’s website at www.sec.gov.
          Shares Market
Value

($000)
Equity Real Estate Investment Trusts (REITs) (96.8%)
Diversified REITs (3.4%)
WP Carey Inc. 1,050,978    75,008
VEREIT Inc. 6,572,017    42,784
STORE Capital Corp. Class A 1,414,562    33,511
PS Business Parks Inc.   125,540    17,318
Washington REIT   500,690    11,195
Global Net Lease Inc.   549,252     9,145
Essential Properties Realty Trust Inc.   560,930     9,031
American Assets Trust Inc.   311,237     8,403
Empire State Realty Trust Inc. Class A   930,204     6,139
Colony Capital Inc. 2,972,224     5,707
iStar Inc.   471,495     5,474
Alexander & Baldwin Inc.   418,217     4,943
Gladstone Commercial Corp.   206,791     3,764
Armada Hoffler Properties Inc.   343,968     3,316
One Liberty Properties Inc.    97,551     1,656
                    237,394
Health Care REITs (8.3%)
Welltower Inc. 2,503,475   134,086
Ventas Inc. 2,274,778    87,261
Healthpeak Properties Inc. 3,083,369    84,145
Medical Properties Trust Inc. 3,178,081    63,975
Omega Healthcare Investors Inc. 1,382,611    44,769
Healthcare Trust of America Inc. Class A 1,321,945    36,499
Healthcare Realty Trust Inc.   821,789    24,078
Physicians Realty Trust 1,202,118    21,686
Sabra Health Care REIT Inc. 1,253,719    18,480
National Health Investors Inc.   272,186    16,876
CareTrust REIT Inc.   582,363    10,494
LTC Properties Inc.   243,422     9,043
Community Healthcare Trust Inc.   125,545     5,741
Diversified Healthcare Trust 1,451,109     5,652
Universal Health Realty Income Trust    79,765     5,550
          Shares Market
Value

($000)
Global Medical REIT Inc.   251,236     2,987
New Senior Investment Group Inc.   506,273     1,721
                    573,043
Hotel & Resort REITs (2.2%)
Host Hotels & Resorts Inc. 4,306,137    46,420
MGM Growth Properties LLC Class A   801,118    21,903
Park Hotels & Resorts Inc. 1,463,235    12,101
Apple Hospitality REIT Inc. 1,296,569    11,436
Sunstone Hotel Investors Inc. 1,372,342    10,265
Ryman Hospitality Properties Inc.   318,106    10,186
Pebblebrook Hotel Trust   798,684     8,466
RLJ Lodging Trust 1,026,525     8,222
Service Properties Trust 1,003,099     6,721
DiamondRock Hospitality Co. 1,221,796     5,645
Xenia Hotels & Resorts Inc.   687,912     5,476
Summit Hotel Properties Inc.   639,777     3,314
Chatham Lodging Trust   284,854     1,484
CorePoint Lodging Inc.   247,002     1,381
Hersha Hospitality Trust Class A   213,976     1,018
Braemar Hotels & Resorts Inc.   181,226       442
Ashford Hospitality Trust Inc.    58,737       230
                    154,710
Industrial REITs (11.8%)
Prologis Inc. 4,507,306   475,160
Duke Realty Corp. 2,247,418    90,324