| |
Transaction
Fee on Purchases and Sales |
|
Transaction
Fee on Reinvested Dividends |
|
Transaction
Fee on Conversion to ETF Shares |
|
| |
Management
Fees |
% |
12b-1
Distribution Fee |
|
Other
Expenses |
% |
Acquired Fund
Fees and Expenses |
% |
Total Annual
Fund Operating Expenses1 |
% |
1
Year |
3
Years |
5
Years |
10
Years |
$ |
$ |
$ |
$ |
|
Total
Return |
Quarter |
|
% |
|
|
-
% |
|
|
1
Year |
5
Years |
10
Years |
Vanguard
Real Estate Index Fund ETF Shares |
|
|
|
Based
on NAV |
|
|
|
Return Before
Taxes |
% |
% |
% |
Return After
Taxes on Distributions |
|
|
|
Return After
Taxes on Distributions and Sale of Fund Shares |
|
|
|
Based
on Market Price |
|
|
|
Return Before
Taxes |
|
|
|
Real
Estate Spliced Index
(reflects no
deduction for fees, expenses, or taxes) |
% |
% |
% |
MSCI
US Investable Market Real Estate 25/50 Index
(reflects no
deduction for fees, expenses, or taxes) |
|
|
|
Dow
Jones U.S. Total Stock Market Float Adjusted Index
(reflects no
deduction for fees, expenses, or taxes) |
|
|
|
Plain
Talk About Fund Expenses |
All funds
have operating expenses. These expenses, which are deducted
from a
fund’s gross income, are expressed as a percentage of the net assets
of the
fund. Assuming that operating expenses remain as stated in the Fees
and
Expenses section, Vanguard Real Estate Index Fund ETF Shares’
expense
ratio would be 0.13%, or $1.30 per $1,000 of average net assets.
The
average expense ratio for real estate funds in 2023 was 1.16%, or
$11.60 per
$1,000 of average net assets (derived from data provided by
Lipper, a
Thomson Reuters Company, which reports on the fund
industry). |
Plain
Talk About Costs of Investing |
Costs are
an important consideration in choosing an ETF. That is because
you, as a
shareholder, pay a proportionate share of the costs of operating a
fund and
any transaction costs incurred when the fund buys or sells
securities,
including costs generated by shareholders of other share classes
offered by
the fund. These costs can erode a substantial portion of the gross
income or
the capital appreciation a fund achieves. Even seemingly small
differences
in expenses can, over time, have a dramatic effect on a
fund’s
performance. |
Plain
Talk About REITs |
Rather
than directly owning properties—which can be costly and difficult to
convert
into cash when needed—some investors buy shares in a company
that
owns and manages real estate. Such a company is known as a real
estate
investment trust, or REIT. Unlike corporations, REITs do not have to
pay
income taxes if they meet certain Internal Revenue Code requirements.
To
qualify, a REIT must distribute at least 90% of its taxable income to its
shareholders
and receive at least 75% of that income from rents, mortgages,
and
sales of property. REITs offer investors greater liquidity and
diversification
than direct ownership of a handful of properties. REITs also
offer
the potential for higher income than an investment in common stocks
would
provide. As with any investment in real estate, however, a REIT’s
performance
depends on specific factors, such as the company’s ability to
find
tenants for its properties, to renew leases, and to finance property
purchases
and renovations. That said, returns from REITs may not
correspond
to returns from direct property
ownership. |
Plain
Talk About Types of REITs |
An
equity
REIT
generally owns properties directly. Equity REITs typically
generate
income from rental and lease payments, and they offer the potential
for
growth from property appreciation as well as occasional capital gains from
the
sale of property. A mortgage
REIT
makes loans to commercial real estate
developers.
Mortgage REITs earn interest income and are subject to credit
risk
(i.e., the chance that a developer will fail to repay a loan). A
hybrid
REIT
holds
both properties and mortgages. The Fund invests in equity REITs and
other
real estate-related
investments. |
Fund
Allocation by
Company
Type |
Percentage
of Fund1
|
Data Center
REITs |
9.0
% |
Diversified
Real Estate Activities |
0.2
% |
Diversified
REITs |
2.1
% |
Health Care
REITs |
7.7
% |
Hotel &
Resort REITs |
2.9
% |
Industrial
REITs |
12.7
% |
Multi-Family
Residential REITs |
8.4
% |
Office
REITs |
4.7
% |
Other
Specialized REITs |
6.0
% |
Real Estate
Development |
0.3
% |
Real Estate
Operating Companies |
0.3
% |
Real Estate
Services |
6.9
% |
Retail
REITs |
12.9
% |
Self-Storage
REITs |
6.7
% |
Single-Family
Residential REITs |
4.5
% |
Telecom Tower
REITs |
12.3
% |
Timber
REITs |
2.4
% |
Plain
Talk About Derivatives |
Derivatives
can take many forms. Some forms of derivatives—such as
exchange-traded
futures and options on securities, commodities, or
indexes—have
been trading on regulated exchanges for decades. These
types
of derivatives are standardized contracts that can easily be bought and
sold
and whose market values are determined and published daily. On the
other
hand, non-exchange-traded derivatives—such as certain swap
agreements—tend
to be more specialized or complex and may be more
difficult
to accurately value. |
Plain
Talk About Vanguard’s Unique Corporate Structure |
Vanguard
is owned jointly by the funds it oversees and thus indirectly by the
shareholders
in those funds. Most other mutual funds are operated by
management
companies that are owned by third parties—either public or
private
stockholders—and not by the funds they
serve. |
Plain
Talk About Distributions |
As
a shareholder, you are entitled to your portion of a fund’s income from
interest
and dividends as well as capital gains from the fund’s sale of
investments.
Income consists of both the dividends that the fund earns from
any
stock holdings and the interest it receives from any money market and
bond
investments. Capital gains are realized whenever the fund sells
securities
for higher prices than it paid for
them. |
Plain
Talk About Return of Capital |
The
Internal Revenue Code requires a REIT to distribute at least 90% of its
taxable
income to investors. In many cases, however, because of “noncash”
expenses
such as property depreciation, an equity REIT’s cash flow will
exceed
its taxable income. The REIT may distribute this excess cash to
investors.
Such a distribution is classified as a return
of capital. |
Vanguard
Fund |
Inception
Date |
Vanguard
Fund
Number |
CUSIP
Number |
Vanguard
Real Estate Index Fund |
|
|
|
ETF
Shares |
9/23/2004
(Investor
Shares
5/13/1996) |
986 |
922908553 |
|
|
|
|
|
|
For a
Share Outstanding
Throughout
Each Period |
Year Ended January
31, | ||||
2024 |
2023 |
2022 |
2021 |
2020 | |
Net
Asset Value, Beginning of Period |
$91.06 |
$106.44 |
$84.96 |
$93.93 |
$83.36 |
Investment
Operations |
|
|
|
|
|
Net
Investment Income1 |
2.527 |
2.240 |
1.960 |
1.889 |
2.335 |
Net
Realized and Unrealized Gain (Loss) on Investments |
(6.154) |
(14.394) |
22.486 |
(7.525) |
11.379 |
Total from
Investment Operations |
(3.627) |
(12.154) |
24.446 |
(5.636) |
13.714 |
Distributions |
|
|
|
|
|
Dividends
from Net Investment Income |
(2.595) |
(2.152) |
(1.943) |
(1.947) |
(2.364) |
Distributions
from Realized Capital Gains |
— |
— |
— |
— |
— |
Return of
Capital |
(.898) |
(1.074) |
(1.023) |
(1.387) |
(.780) |
Total
Distributions |
(3.493) |
(3.226) |
(2.966) |
(3.334) |
(3.144) |
Net
Asset Value, End of Period |
$83.94 |
$91.06 |
$106.44 |
$84.96 |
$93.93 |
Total
Return |
-3.81% |
-11.25% |
28.88% |
-5.80% |
16.70% |
Ratios/Supplemental
Data |
|
|
|
|
|
Net
Assets, End of Period (Millions) |
$32,359 |
$36,825 |
$46,673 |
$32,064 |
$37,682 |
Ratio of
Total Expenses to Average Net Assets |
0.12% |
0.12%2 |
0.12% |
0.12% |
0.12% |
Acquired
Fund Fees and Expenses3 |
0.01% |
— |
— |
— |
— |
Ratio of
Net Investment Income to Average Net Assets |
3.07% |
2.38% |
1.90% |
2.33% |
2.60% |
Portfolio
Turnover Rate4 |
9% |
7% |
7% |
8% |
6% |
|
|
|
|
|
|
|
|
1 |
Calculated
based on average shares outstanding. |
2 |
The ratio of
expenses to average net assets for the period net of reduction from
custody fee
offset
arrangements was 0.12%. |
3 |
For the
fiscal year ended January 31, 2023, and for each prior period, the
acquired fund fees
and expenses
were less than 0.01%. |
4 |
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. |