Vanguard Communication Services Index Fund |
Vanguard Consumer Discretionary Index Fund |
Vanguard Consumer Staples Index Fund |
Vanguard Energy Index Fund |
Vanguard Financials Index Fund |
Vanguard Health Care Index Fund |
Vanguard Industrials Index Fund |
Vanguard Information Technology Index Fund |
Vanguard Materials Index Fund |
Vanguard Utilities Index Fund |
About Your Fund’s Expenses
|
1 |
Communication Services Index Fund
|
4 |
Consumer Discretionary Index Fund
|
15 |
Consumer Staples Index Fund
|
27 |
Energy Index Fund
|
38 |
Financials Index Fund
|
49 |
Health Care Index Fund
|
62 |
Industrials Index Fund
|
75 |
Information Technology Index Fund
|
87 |
Materials Index Fund
|
100 |
Utilities Index Fund
|
111 |
• | 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. |
• | 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. |
Six Months Ended February 29, 2024 | |||
Beginning Account Value 8/31/2023 |
Ending Account Value 2/29/2024 |
Expenses Paid During Period | |
Based on Actual Fund Return | |||
Communication Services Index Fund | |||
ETF Shares | $1,000.00 | $1,177.70 | $0.54 |
Admiral™ Shares | 1,000.00 | 1,177.80 | 0.54 |
Consumer Discretionary Index Fund | |||
ETF Shares | $1,000.00 | $1,107.50 | $0.52 |
Admiral Shares | 1,000.00 | 1,107.60 | 0.52 |
Consumer Staples Index Fund | |||
ETF Shares | $1,000.00 | $1,046.50 | $0.51 |
Admiral Shares | 1,000.00 | 1,046.60 | 0.51 |
Energy Index Fund | |||
ETF Shares | $1,000.00 | $979.00 | $0.49 |
Admiral Shares | 1,000.00 | 979.20 | 0.49 |
Financials Index Fund | |||
ETF Shares | $1,000.00 | $1,188.90 | $0.54 |
Admiral Shares | 1,000.00 | 1,189.10 | 0.54 |
Health Care Index Fund | |||
ETF Shares | $1,000.00 | $1,095.00 | $0.52 |
Admiral Shares | 1,000.00 | 1,095.00 | 0.52 |
Industrials Index Fund | |||
ETF Shares | $1,000.00 | $1,134.80 | $0.53 |
Admiral Shares | 1,000.00 | 1,134.90 | 0.53 |
Information Technology Index Fund | |||
ETF Shares | $1,000.00 | $1,169.70 | $0.54 |
Admiral Shares | 1,000.00 | 1,169.70 | 0.54 |
Materials Index Fund | |||
ETF Shares | $1,000.00 | $1,067.70 | $0.51 |
Admiral Shares | 1,000.00 | 1,067.80 | 0.51 |
Utilities Index Fund | |||
ETF Shares | $1,000.00 | $1,004.70 | $0.50 |
Admiral Shares | 1,000.00 | 1,004.60 | 0.50 |
Six Months Ended February 29, 2024 | |||
Beginning Account Value 8/31/2023 |
Ending Account Value 2/29/2024 |
Expenses Paid During Period | |
Based on Hypothetical 5% Yearly Return | |||
Communication Services Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Consumer Discretionary Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Consumer Staples Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Energy Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Financials Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Health Care Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Industrials Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Information Technology Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Materials Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Utilities Index Fund | |||
ETF Shares | $1,000.00 | $1,024.37 | $0.50 |
Admiral Shares | 1,000.00 | 1,024.37 | 0.50 |
Diversified Telecommunication Services | 10.4% |
Entertainment | 19.1 |
Interactive Media & Services | 50.7 |
Media | 16.6 |
Wireless Telecommunication Services | 3.2 |
Shares | Market Value• ($000) | ||
* | United States Cellular Corp. | 63,656 | 2,221 |
* | Gogo Inc. | 262,885 | 2,145 |
132,979 | |||
Total Common Stocks (Cost $4,152,558) | 4,153,809 | ||
Temporary Cash Investments (0.2%) | |||
Money Market Fund (0.2%) | |||
4,5 | Vanguard Market Liquidity Fund, 5.400% (Cost $9,117) | 91,209 | 9,120 |
Total Investments (100.1%) (Cost $4,161,675) | 4,162,929 | ||
Other Assets and Liabilities—Net (-0.1%) | (5,634) | ||
Net Assets (100.0%) | 4,157,295 | ||
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 $5,840,000. |
2 | “Other” represents securities that are not classified by the fund’s benchmark index. |
3 | Security value determined using significant unobservable inputs. |
4 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
5 | Collateral of $6,790,000 was received for securities on loan. |
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) |
Paramount Global Class B | 8/30/24 | BANA | 2,484 | (5.326) | — | (14) |
Paramount Global Class B | 8/30/24 | BANA | 1,822 | (5.326) | — | (10) |
— | (24) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $4,152,558) | 4,153,809 |
Affiliated Issuers (Cost $9,117) | 9,120 |
Total Investments in Securities | 4,162,929 |
Investment in Vanguard | 126 |
Cash Collateral Pledged—Over-the-Counter Swap Contracts | 1,340 |
Receivables for Investment Securities Sold | 128,203 |
Receivables for Accrued Income | 2,302 |
Receivables for Capital Shares Issued | 446 |
Total Assets | 4,295,346 |
Liabilities | |
Due to Custodian | 1,387 |
Payables for Investment Securities Purchased | 129,180 |
Collateral for Securities on Loan | 6,790 |
Payables for Capital Shares Redeemed | 511 |
Payables to Vanguard | 159 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 24 |
Total Liabilities | 138,051 |
Net Assets | 4,157,295 |
1 Includes $5,840,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 4,573,729 |
Total Distributable Earnings (Loss) | (416,434) |
Net Assets | 4,157,295 |
ETF Shares—Net Assets | |
Applicable
to 30,953,605 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
3,965,418 |
Net Asset Value Per Share—ETF Shares | $128.11 |
Admiral Shares—Net Assets | |
Applicable
to 2,939,161 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
191,877 |
Net Asset Value Per Share—Admiral Shares | $65.28 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $109.41 | $94.12 | $149.87 | $108.04 | $87.24 | $86.83 |
Investment Operations | ||||||
Net Investment Income1 | .683 | 1.128 | 1.110 | 1.018 | 1.005 | .917 |
Net Realized and Unrealized Gain (Loss) on Investments | 18.654 | 15.127 | (55.695) | 41.708 | 20.743 | .316 |
Total from Investment Operations | 19.337 | 16.255 | (54.585) | 42.726 | 21.748 | 1.233 |
Distributions | ||||||
Dividends from Net Investment Income | (.637) | (.965) | (1.165) | (.896) | (.948) | (.823) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.637) | (.965) | (1.165) | (.896) | (.948) | (.823) |
Net Asset Value, End of Period | $128.11 | $109.41 | $94.12 | $149.87 | $108.04 | $87.24 |
Total Return | 17.77% | 17.46% | -36.61% | 39.75% | 25.15% | 1.47% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $3,965 | $3,424 | $2,717 | $4,787 | $2,914 | $2,016 |
Ratio of Total Expenses to Average Net Assets | 0.10% | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.18% | 1.19% | 0.92% | 0.80% | 1.09% | 1.09% |
Portfolio Turnover Rate3 | 8% | 15% | 16% | 15% | 15% | 33% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $55.75 | $47.97 | $76.38 | $55.06 | $44.46 | $44.25 |
Investment Operations | ||||||
Net Investment Income1 | .340 | .591 | .572 | .519 | .512 | .470 |
Net Realized and Unrealized Gain (Loss) on Investments | 9.515 | 7.682 | (28.388) | 21.259 | 10.571 | .157 |
Total from Investment Operations | 9.855 | 8.273 | (27.816) | 21.778 | 11.083 | .627 |
Distributions | ||||||
Dividends from Net Investment Income | (.325) | (.493) | (.594) | (.458) | (.483) | (.417) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.325) | (.493) | (.594) | (.458) | (.483) | (.417) |
Net Asset Value, End of Period | $65.28 | $55.75 | $47.97 | $76.38 | $55.06 | $44.46 |
Total Return2 | 17.78% | 17.44% | -36.61% | 39.76% | 25.16% | 1.46% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $192 | $115 | $70 | $124 | $67 | $50 |
Ratio of Total Expenses to Average Net Assets | 0.10% | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.14% | 1.21% | 0.93% | 0.79% | 1.10% | 1.09% |
Portfolio Turnover Rate4 | 8% | 15% | 16% | 15% | 15% | 33% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
C. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 4,153,809 | — | — | 4,153,809 |
Temporary Cash Investments | 9,120 | — | — | 9,120 |
Total | 4,162,929 | — | — | 4,162,929 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 24 | — | 24 |
D. | As of February 29, 2024, 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 | 4,193,240 |
Gross Unrealized Appreciation | 636,530 |
Gross Unrealized Depreciation | (666,841) |
Net Unrealized Appreciation (Depreciation) | (30,311) |
E. | During the six months ended February 29, 2024, the fund purchased $370,039,000 of investment securities and sold $299,574,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $716,737,000 and $738,629,000, respectively, in connection with in-kind purchases and redemptions of the fund's capital shares. |
F. | Capital share transactions for each class of shares were: |
Six Months Ended February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 728,1931 | 6,1331 | 1,133,331 | 11,775 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (736,369)1 | (6,475)1 | (843,206) | (9,350) | |
Net Increase (Decrease)—ETF Shares | (8,176) | (342) | 290,125 | 2,425 | |
Admiral Shares | |||||
Issued | 88,181 | 1,480 | 74,117 | 1,497 | |
Issued in Lieu of Cash Distributions | 598 | 11 | 687 | 14 | |
Redeemed | (35,974) | (613) | (44,906) | (909) | |
Net Increase (Decrease)—Admiral Shares | 52,805 | 878 | 29,898 | 602 |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 1,650,000 issued shares and 1,700,000 redeemed shares valued at $210,822,000 and $220,041,000, respectively, which settled shortly afterwards. |
G. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
H. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Automobile Components | 2.3% |
Automobiles | 13.3 |
Broadline Retail | 25.2 |
Distributors | 1.0 |
Diversified Consumer Services | 1.6 |
Hotels, Restaurants & Leisure | 22.0 |
Household Durables | 5.8 |
Leisure Products | 1.1 |
Specialty Retail | 21.9 |
Textiles, Apparel & Luxury Goods | 5.8 |
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) |
MercadoLibre Inc. | 8/30/24 | BANA | 10,848 | (5.326) | — | (50) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $5,457,340) | 6,266,576 |
Affiliated Issuers (Cost $31,866) | 31,872 |
Total Investments in Securities | 6,298,448 |
Investment in Vanguard | 184 |
Cash | 119 |
Cash Collateral Pledged—Over-the-Counter Swap Contracts | 600 |
Receivables for Investment Securities Sold | 78,045 |
Receivables for Accrued Income | 5,172 |
Receivables for Capital Shares Issued | 389 |
Total Assets | 6,382,957 |
Liabilities | |
Payables for Investment Securities Purchased | 76,125 |
Collateral for Securities on Loan | 23,752 |
Payables for Capital Shares Redeemed | 6,002 |
Payables to Vanguard | 236 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 50 |
Total Liabilities | 106,165 |
Net Assets | 6,276,792 |
1 Includes $19,314,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 5,772,837 |
Total Distributable Earnings (Loss) | 503,955 |
Net Assets | 6,276,792 |
ETF Shares—Net Assets | |
Applicable
to 17,804,839 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
5,630,320 |
Net Asset Value Per Share—ETF Shares | $316.22 |
Admiral Shares—Net Assets | |
Applicable
to 3,949,594 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
646,472 |
Net Asset Value Per Share—Admiral Shares | $163.68 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $286.85 | $256.97 | $320.99 | $246.86 | $178.51 | $180.85 |
Investment Operations | ||||||
Net Investment Income1 | 1.087 | 2.493 | 2.329 | 1.724 | 1.998 | 2.052 |
Net Realized and Unrealized Gain (Loss) on Investments | 29.589 | 29.853 | (63.227) | 76.697 | 68.603 | (2.391) |
Total from Investment Operations | 30.676 | 32.346 | (60.898) | 78.421 | 70.601 | (.339) |
Distributions | ||||||
Dividends from Net Investment Income | (1.306) | (2.466) | (3.122) | (4.291) | (2.251) | (2.001) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.306) | (2.466) | (3.122) | (4.291) | (2.251) | (2.001) |
Net Asset Value, End of Period | $316.22 | $286.85 | $256.97 | $320.99 | $246.86 | $178.51 |
Total Return | 10.75% | 12.75% | -19.11% | 32.39% | 39.98% | -0.14% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $5,630 | $5,187 | $4,638 | $6,658 | $4,026 | $3,049 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 0.74% | 0.99% | 0.78% | 0.60% | 1.06% | 1.20% |
Portfolio Turnover Rate3 | 3% | 11% | 9% | 8% | 10% | 9% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $148.47 | $133.01 | $166.15 | $127.78 | $92.40 | $93.61 |
Investment Operations | ||||||
Net Investment Income1 | .562 | 1.287 | 1.211 | .889 | 1.033 | 1.058 |
Net Realized and Unrealized Gain (Loss) on Investments | 15.324 | 15.450 | (32.737) | 39.704 | 35.512 | (1.232) |
Total from Investment Operations | 15.886 | 16.737 | (31.526) | 40.593 | 36.545 | (.174) |
Distributions | ||||||
Dividends from Net Investment Income | (.676) | (1.277) | (1.614) | (2.223) | (1.165) | (1.036) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.676) | (1.277) | (1.614) | (2.223) | (1.165) | (1.036) |
Net Asset Value, End of Period | $163.68 | $148.47 | $133.01 | $166.15 | $127.78 | $92.40 |
Total Return2 | 10.76% | 12.75% | -19.11% | 32.39% | 40.01% | -0.14% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $647 | $608 | $523 | $753 | $437 | $321 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 0.74% | 0.98% | 0.79% | 0.60% | 1.06% | 1.20% |
Portfolio Turnover Rate4 | 3% | 11% | 9% | 8% | 10% | 9% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $1,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 6,266,576 | — | — | 6,266,576 |
Temporary Cash Investments | 31,872 | — | — | 31,872 |
Total | 6,298,448 | — | — | 6,298,448 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 50 | — | 50 |
E. | As of February 29, 2024, 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 | 5,504,554 |
Gross Unrealized Appreciation | 1,259,069 |
Gross Unrealized Depreciation | (465,175) |
Net Unrealized Appreciation (Depreciation) | 793,894 |
F. | During the six months ended February 29, 2024, the fund purchased $171,508,000 of investment securities and sold $183,525,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $558,584,000 and $602,828,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 574,1841 | 1,9421 | 947,780 | 3,535 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (608,490)1 | (2,220)1 | (843,442) | (3,500) | |
Net Increase (Decrease)—ETF Shares | (34,306) | (278) | 104,338 | 35 | |
Admiral Shares | |||||
Issued | 71,267 | 475 | 154,826 | 1,153 | |
Issued in Lieu of Cash Distributions | 2,331 | 16 | 4,229 | 33 | |
Redeemed | (95,248) | (637) | (133,095) | (1,026) | |
Net Increase (Decrease)—Admiral Shares | (21,650) | (146) | 25,960 | 160 |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 340,000 issued shares and 340,000 redeemed shares valued at $106,291,000 and $101,912,000, respectively, which settled shortly afterwards. |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Beverages | 21.5% |
Consumer Staples Distribution & Retail | 30.6 |
Food Products | 17.1 |
Household Products | 18.8 |
Personal Care Products | 4.5 |
Tobacco | 7.5 |
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) |
Clorox Co. | 8/30/24 | BANA | 9,199 | (5.326) | 35 | — |
Kraft Heinz Co. | 8/30/24 | BANA | 13,054 | (5.326) | — | (59) |
35 | (59) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $7,040,425) | 7,677,048 |
Affiliated Issuers (Cost $23,270) | 23,273 |
Total Investments in Securities | 7,700,321 |
Investment in Vanguard | 245 |
Cash | 1,880 |
Cash Collateral Pledged—Over-the-Counter Swap Contracts | 140 |
Receivables for Investment Securities Sold | 72,878 |
Receivables for Accrued Income | 10,572 |
Receivables for Capital Shares Issued | 1,322 |
Unrealized Appreciation—Over-the-Counter Swap Contracts | 35 |
Total Assets | 7,787,393 |
Liabilities | |
Payables for Investment Securities Purchased | 76,572 |
Collateral for Securities on Loan | 7,800 |
Payables for Capital Shares Redeemed | 3,757 |
Payables to Vanguard | 291 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 59 |
Total Liabilities | 88,479 |
Net Assets | 7,698,914 |
1 Includes $7,498,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 7,126,137 |
Total Distributable Earnings (Loss) | 572,777 |
Net Assets | 7,698,914 |
ETF Shares—Net Assets | |
Applicable
to 32,358,852 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
6,419,496 |
Net Asset Value Per Share—ETF Shares | $198.38 |
Admiral Shares—Net Assets | |
Applicable
to 13,079,625 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
1,279,418 |
Net Asset Value Per Share—Admiral Shares | $97.82 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $192.42 | $188.63 | $187.61 | $167.31 | $154.72 | $140.13 |
Investment Operations | ||||||
Net Investment Income1 | 2.697 | 4.909 | 4.356 | 4.385 | 3.992 | 3.896 |
Net Realized and Unrealized Gain (Loss) on Investments | 6.083 | 3.705 | .907 | 20.341 | 12.658 | 14.346 |
Total from Investment Operations | 8.780 | 8.614 | 5.263 | 24.726 | 16.650 | 18.242 |
Distributions | ||||||
Dividends from Net Investment Income | (2.820) | (4.824) | (4.243) | (4.427) | (4.060) | (3.652) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (2.820) | (4.824) | (4.243) | (4.427) | (4.060) | (3.652) |
Net Asset Value, End of Period | $198.38 | $192.42 | $188.63 | $187.61 | $167.31 | $154.72 |
Total Return | 4.65% | 4.65% | 2.83% | 15.01% | 11.01% | 13.24% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $6,420 | $6,940 | $6,747 | $5,908 | $5,712 | $5,296 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 2.66% | 2.57% | 2.27% | 2.50% | 2.58% | 2.71% |
Portfolio Turnover Rate3 | 4% | 9% | 5% | 8% | 3% | 6% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $94.88 | $93.01 | $92.51 | $82.50 | $76.29 | $69.09 |
Investment Operations | ||||||
Net Investment Income1 | 1.330 | 2.416 | 2.147 | 2.160 | 1.973 | 1.923 |
Net Realized and Unrealized Gain (Loss) on Investments | 3.001 | 1.831 | .448 | 10.032 | 6.239 | 7.076 |
Total from Investment Operations | 4.331 | 4.247 | 2.595 | 12.192 | 8.212 | 8.999 |
Distributions | ||||||
Dividends from Net Investment Income | (1.391) | (2.377) | (2.095) | (2.183) | (2.002) | (1.799) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.391) | (2.377) | (2.095) | (2.183) | (2.002) | (1.799) |
Net Asset Value, End of Period | $97.82 | $94.88 | $93.01 | $92.51 | $82.50 | $76.29 |
Total Return2 | 4.66% | 4.65% | 2.85% | 15.04% | 11.03% | 13.24% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $1,279 | $1,224 | $1,225 | $846 | $791 | $710 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 2.66% | 2.56% | 2.27% | 2.50% | 2.59% | 2.71% |
Portfolio Turnover Rate4 | 4% | 9% | 5% | 8% | 3% | 6% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $1,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 7,677,048 | — | — | 7,677,048 |
Temporary Cash Investments | 23,273 | — | — | 23,273 |
Total | 7,700,321 | — | — | 7,700,321 |
Derivative Financial Instruments | ||||
Assets | ||||
Swap Contracts | — | 35 | — | 35 |
Liabilities | ||||
Swap Contracts | — | 59 | — | 59 |
E. | As of February 29, 2024, 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 | 7,072,928 |
Gross Unrealized Appreciation | 1,243,412 |
Gross Unrealized Depreciation | (616,019) |
Net Unrealized Appreciation (Depreciation) | 627,393 |
F. | During the six months ended February 29, 2024, the fund purchased $304,754,000 of investment securities and sold $289,959,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $329,888,000 and $1,013,785,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 337,8771 | 1,7661 | 1,190,077 | 6,226 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (1,020,064)1 | (5,475)1 | (1,108,265) | (5,925) | |
Net Increase (Decrease)—ETF Shares | (682,187) | (3,709) | 81,812 | 301 | |
Admiral Shares | |||||
Issued | 195,770 | 2,107 | 326,126 | 3,468 | |
Issued in Lieu of Cash Distributions | 15,653 | 170 | 27,369 | 295 | |
Redeemed | (193,840) | (2,096) | (379,020) | (4,040) | |
Net Increase (Decrease)—Admiral Shares | 17,583 | 181 | (25,525) | (277) |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 270,000 issued shares and 135,000 redeemed shares valued at $53,503,000 and $24,676,000, respectively, which settled shortly afterwards. |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Coal & Consumable Fuels | 0.4% |
Integrated Oil & Gas | 38.5 |
Oil & Gas Drilling | 1.2 |
Oil & Gas Equipment & Services | 9.8 |
Oil & Gas Exploration & Production | 28.4 |
Oil & Gas Refining & Marketing | 10.6 |
Oil & Gas Storage & Transportation | 11.1 |
Shares | Market Value• ($000) | ||
Temporary Cash Investments (0.2%) | |||
Money Market Fund (0.2%) | |||
2,3 | Vanguard Market Liquidity Fund, 5.400% (Cost $14,111) | 141,144 | 14,113 |
Total Investments (99.7%) (Cost $8,665,933) | 9,749,072 | ||
Other Assets and Liabilities—Net (0.3%) | 33,995 | ||
Net Assets (100.0%) | 9,783,067 | ||
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 $13,653,000. |
2 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
3 | Collateral of $14,090,000 was received for securities on loan. |
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) |
EQT Corp. | 8/30/24 | BANA | 11,145 | (5.326) | 2 | — |
Exxon Mobil Corp. | 1/31/25 | CITNA | 29,788 | (5.311) | — | (13) |
ONEOK Inc. | 1/31/25 | CITNA | 11,268 | (5.326) | 104 | — |
106 | (13) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. | |
CITNA—Citibank, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $8,651,822) | 9,734,959 |
Affiliated Issuers (Cost $14,111) | 14,113 |
Total Investments in Securities | 9,749,072 |
Investment in Vanguard | 303 |
Receivables for Investment Securities Sold | 31,599 |
Receivables for Accrued Income | 50,165 |
Receivables for Capital Shares Issued | 551 |
Unrealized Appreciation—Over-the-Counter Swap Contracts | 106 |
Total Assets | 9,831,796 |
Liabilities | |
Due to Custodian | 2,292 |
Payables for Investment Securities Purchased | 29,889 |
Collateral for Securities on Loan | 14,090 |
Payables for Capital Shares Redeemed | 2,072 |
Payables to Vanguard | 373 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 13 |
Total Liabilities | 48,729 |
Net Assets | 9,783,067 |
1 Includes $13,653,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 9,856,169 |
Total Distributable Earnings (Loss) | (73,102) |
Net Assets | 9,783,067 |
ETF Shares—Net Assets | |
Applicable
to 67,451,201 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
8,102,294 |
Net Asset Value Per Share—ETF Shares | $120.12 |
Admiral Shares—Net Assets | |
Applicable
to 28,009,419 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
1,680,773 |
Net Asset Value Per Share—Admiral Shares | $60.01 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $124.62 | $113.45 | $67.99 | $47.90 | $75.75 | $103.13 |
Investment Operations | ||||||
Net Investment Income1 | 1.935 | 4.205 | 3.625 | 2.802 | 2.957 | 2.769 |
Net Realized and Unrealized Gain (Loss) on Investments | (4.509) | 11.554 | 45.526 | 19.789 | (28.064) | (27.449) |
Total from Investment Operations | (2.574) | 15.759 | 49.151 | 22.591 | (25.107) | (24.680) |
Distributions | ||||||
Dividends from Net Investment Income | (1.926) | (4.589) | (3.691) | (2.501) | (2.743) | (2.700) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.926) | (4.589) | (3.691) | (2.501) | (2.743) | (2.700) |
Net Asset Value, End of Period | $120.12 | $124.62 | $113.45 | $67.99 | $47.90 | $75.75 |
Total Return | -2.10% | 14.51% | 74.07% | 48.07% | -33.87% | -24.34% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $8,102 | $8,440 | $7,862 | $4,806 | $2,720 | $3,029 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 3.09% | 3.58% | 3.80% | 4.54% | 4.91% | 3.15% |
Portfolio Turnover Rate3 | 3% | 9% | 6% | 5% | 8% | 7% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $62.25 | $56.67 | $33.97 | $23.93 | $37.84 | $51.52 |
Investment Operations | ||||||
Net Investment Income1 | .962 | 2.095 | 1.829 | 1.435 | 1.461 | 1.388 |
Net Realized and Unrealized Gain (Loss) on Investments | (2.240) | 5.777 | 22.715 | 9.855 | (14.001) | (13.720) |
Total from Investment Operations | (1.278) | 7.872 | 24.544 | 11.290 | (12.540) | (12.332) |
Distributions | ||||||
Dividends from Net Investment Income | (.962) | (2.292) | (1.844) | (1.250) | (1.370) | (1.348) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.962) | (2.292) | (1.844) | (1.250) | (1.370) | (1.348) |
Net Asset Value, End of Period | $60.01 | $62.25 | $56.67 | $33.97 | $23.93 | $37.84 |
Total Return2 | -2.08% | 14.58% | 73.97% | 48.18% | -33.82% | -24.33% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $1,681 | $1,900 | $1,944 | $1,100 | $407 | $468 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 3.07% | 3.57% | 3.83% | 4.52% | 4.84% | 3.15% |
Portfolio Turnover Rate4 | 3% | 9% | 6% | 5% | 8% | 7% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $6,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 9,734,959 | — | — | 9,734,959 |
Temporary Cash Investments | 14,113 | — | — | 14,113 |
Total | 9,749,072 | — | — | 9,749,072 |
Derivative Financial Instruments | ||||
Assets | ||||
Swap Contracts | — | 106 | — | 106 |
Liabilities | ||||
Swap Contracts | — | 13 | — | 13 |
E. | As of February 29, 2024, 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 | 8,707,596 |
Gross Unrealized Appreciation | 1,467,966 |
Gross Unrealized Depreciation | (426,490) |
Net Unrealized Appreciation (Depreciation) | 1,041,476 |
F. | During the six months ended February 29, 2024, the fund purchased $298,604,000 of investment securities and sold $416,115,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $826,084,000 and $883,631,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 862,1661 | 7,0991 | 1,972,280 | 16,850 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (883,707)1 | (7,375)1 | (2,135,217) | (18,425) | |
Net Increase (Decrease)—ETF Shares | (21,541) | (276) | (162,937) | (1,575) | |
Admiral Shares | |||||
Issued | 197,248 | 3,269 | 706,787 | 12,005 | |
Issued in Lieu of Cash Distributions | 25,154 | 410 | 68,739 | 1,272 | |
Redeemed | (368,461) | (6,195) | (998,358) | (17,057) | |
Net Increase (Decrease)—Admiral Shares | (146,059) | (2,516) | (222,832) | (3,780) |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 225,000 issued shares and 500,000 redeemed shares valued at $26,961,000 and $58,841,000, respectively, which settled shortly afterwards. |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Banks | 26.5% |
Capital Markets | 23.1 |
Consumer Finance | 4.3 |
Financial Services | 28.1 |
Insurance | 17.2 |
Mortgage Real Estate Investment Trusts (REITs) | 0.8 |
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) |
Arch Capital Group Ltd. | 8/30/24 | BANA | 24,087 | (5.326) | — | (97) |
Visa Inc. Class A | 8/30/24 | BANA | 84,792 | (5.226) | — | (189) |
— | (286) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $8,361,984) | 9,762,241 |
Affiliated Issuers (Cost $96,684) | 96,700 |
Total Investments in Securities | 9,858,941 |
Investment in Vanguard | 303 |
Receivables for Investment Securities Sold | 37,052 |
Receivables for Accrued Income | 14,571 |
Receivables for Capital Shares Issued | 4,664 |
Total Assets | 9,915,531 |
Liabilities | |
Due to Custodian | 61 |
Payables for Investment Securities Purchased | 29,040 |
Collateral for Securities on Loan | 6,646 |
Payables for Capital Shares Redeemed | 8,905 |
Payables to Vanguard | 377 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 286 |
Total Liabilities | 45,315 |
Net Assets | 9,870,216 |
1 Includes $6,257,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 9,031,400 |
Total Distributable Earnings (Loss) | 838,816 |
Net Assets | 9,870,216 |
ETF Shares—Net Assets | |
Applicable
to 93,066,731 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
9,126,858 |
Net Asset Value Per Share—ETF Shares | $98.07 |
Admiral Shares—Net Assets | |
Applicable
to 15,124,687 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
743,358 |
Net Asset Value Per Share—Admiral Shares | $49.15 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $83.49 | $81.31 | $94.79 | $61.18 | $67.31 | $71.60 |
Investment Operations | ||||||
Net Investment Income1 | .893 | 1.924 | 1.852 | 1.676 | 1.652 | 1.539 |
Net Realized and Unrealized Gain (Loss) on Investments | 14.732 | 2.219 | (13.457) | 33.519 | (6.081) | (4.338) |
Total from Investment Operations | 15.625 | 4.143 | (11.605) | 35.195 | (4.429) | (2.799) |
Distributions | ||||||
Dividends from Net Investment Income | (1.045) | (1.963) | (1.875) | (1.585) | (1.701) | (1.491) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.045) | (1.963) | (1.875) | (1.585) | (1.701) | (1.491) |
Net Asset Value, End of Period | $98.07 | $83.49 | $81.31 | $94.79 | $61.18 | $67.31 |
Total Return | 18.89% | 5.27% | -12.43% | 58.26% | -6.73% | -3.85% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $9,127 | $8,711 | $8,676 | $10,946 | $6,140 | $7,222 |
Ratio of Total Expenses to Average Net Assets | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 2.00% | 2.34% | 2.03% | 2.09% | 2.53% | 2.30% |
Portfolio Turnover Rate2 | 2% | 20% | 6% | 4% | 5% | 5% |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $41.84 | $40.75 | $47.51 | $30.66 | $33.73 | $35.88 |
Investment Operations | ||||||
Net Investment Income1 | .449 | .962 | .931 | .841 | .828 | .771 |
Net Realized and Unrealized Gain (Loss) on Investments | 7.385 | 1.112 | (6.751) | 16.803 | (3.046) | (2.174) |
Total from Investment Operations | 7.834 | 2.074 | (5.820) | 17.644 | (2.218) | (1.403) |
Distributions | ||||||
Dividends from Net Investment Income | (.524) | (.984) | (.940) | (.794) | (.852) | (.747) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.524) | (.984) | (.940) | (.794) | (.852) | (.747) |
Net Asset Value, End of Period | $49.15 | $41.84 | $40.75 | $47.51 | $30.66 | $33.73 |
Total Return2 | 18.91% | 5.27% | -12.43% | 58.32% | -6.70% | -3.87% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $743 | $664 | $721 | $822 | $432 | $490 |
Ratio of Total Expenses to Average Net Assets | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 2.01% | 2.34% | 2.05% | 2.09% | 2.53% | 2.30% |
Portfolio Turnover Rate3 | 2% | 20% | 6% | 4% | 5% | 5% |
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. |
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. |
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. |
C. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 9,762,241 | — | — | 9,762,241 |
Temporary Cash Investments | 96,700 | — | — | 96,700 |
Total | 9,858,941 | — | — | 9,858,941 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 286 | — | 286 |
D. | As of February 29, 2024, 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 | 8,469,496 |
Gross Unrealized Appreciation | 1,800,212 |
Gross Unrealized Depreciation | (410,767) |
Net Unrealized Appreciation (Depreciation) | 1,389,445 |
E. | During the six months ended February 29, 2024, the fund purchased $145,219,000 of investment securities and sold $222,668,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $994,566,000 and $1,930,917,000, respectively, in connection with in-kind purchases and redemptions of the fund's capital shares. |
F. | Capital share transactions for each class of shares were: |
Six Months Ended February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 1,013,9471 | 11,8611 | 2,179,191 | 26,823 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (1,973,177)1 | (23,125)1 | (2,335,012) | (29,200) | |
Net Increase (Decrease)—ETF Shares | (959,230) | (11,264) | (155,821) | (2,377) | |
Admiral Shares | |||||
Issued | 67,499 | 1,502 | 185,881 | 4,558 | |
Issued in Lieu of Cash Distributions | 6,652 | 155 | 14,096 | 359 | |
Redeemed | (105,344) | (2,396) | (275,482) | (6,754) | |
Net Increase (Decrease)—Admiral Shares | (31,193) | (739) | (75,505) | (1,837) |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 325,000 issued shares and 1,375,000 redeemed shares valued at $27,534,000 and $127,100,000, respectively, which settled shortly afterwards. |
G. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
H. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Biotechnology | 18.7% |
Health Care Equipment & Supplies | 19.9 |
Health Care Providers & Services | 20.3 |
Health Care Technology | 0.9 |
Life Sciences Tools & Services | 11.3 |
Pharmaceuticals | 28.9 |
Shares | Market Value• ($000) | ||
Temporary Cash Investments (0.2%) | |||
Money Market Fund (0.2%) | |||
5,6 | Vanguard Market Liquidity Fund, 5.400% (Cost $46,715) | 467,302 | 46,726 |
Total Investments (100.1%) (Cost $16,444,054) | 20,853,202 | ||
Other Assets and Liabilities—Net (-0.1%) | (24,467) | ||
Net Assets (100.0%) | 20,828,735 | ||
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 $42,041,000. |
2 | Security value determined using significant unobservable inputs. |
3 | “Other” represents securities that are not classified by the fund’s benchmark index. |
4 | Restricted securities totaling $449,000, representing 0.0% of net assets. |
5 | Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield. |
6 | Collateral of $46,665,000 was received for securities on loan. |
CVR—Contingent Value Rights. |
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) |
Alnylam Pharmaceuticals Inc. | 8/30/24 | BANA | 3,777 | (5.326) | — | (18) |
Globus Medical Inc. | 8/30/24 | BANA | 5,399 | (5.322) | — | (17) |
Sarepta Therapeutics Inc. | 8/30/24 | BANA | 8,314 | (5.322) | — | (27) |
— | (62) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $16,397,339) | 20,806,476 |
Affiliated Issuers (Cost $46,715) | 46,726 |
Total Investments in Securities | 20,853,202 |
Investment in Vanguard | 630 |
Receivables for Investment Securities Sold | 50,991 |
Receivables for Accrued Income | 28,261 |
Receivables for Capital Shares Issued | 2,960 |
Total Assets | 20,936,044 |
Liabilities | |
Due to Custodian | 5,908 |
Payables for Investment Securities Purchased | 51,480 |
Collateral for Securities on Loan | 46,665 |
Payables for Capital Shares Redeemed | 2,392 |
Payables to Vanguard | 802 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 62 |
Total Liabilities | 107,309 |
Net Assets | 20,828,735 |
1 Includes $42,041,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 16,563,906 |
Total Distributable Earnings (Loss) | 4,264,829 |
Net Assets | 20,828,735 |
ETF Shares—Net Assets | |
Applicable
to 67,277,329 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
17,875,593 |
Net Asset Value Per Share—ETF Shares | $265.70 |
Admiral Shares—Net Assets | |
Applicable
to 22,219,114 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
2,953,142 |
Net Asset Value Per Share—Admiral Shares | $132.91 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $244.43 | $231.59 | $262.41 | $207.65 | $169.74 | $177.07 |
Investment Operations | ||||||
Net Investment Income1 | 1.777 | 3.418 | 3.157 | 2.893 | 2.702 | 3.6002 |
Net Realized and Unrealized Gain (Loss) on Investments | 21.265 | 12.859 | (30.771) | 54.714 | 37.758 | (7.457) |
Total from Investment Operations | 23.042 | 16.277 | (27.614) | 57.607 | 40.460 | (3.857) |
Distributions | ||||||
Dividends from Net Investment Income | (1.772) | (3.437) | (3.206) | (2.846) | (2.550) | (3.473) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.772) | (3.437) | (3.206) | (2.846) | (2.550) | (3.473) |
Net Asset Value, End of Period | $265.70 | $244.43 | $231.59 | $262.41 | $207.65 | $169.74 |
Total Return | 9.50% | 7.07% | -10.60% | 27.99% | 24.05% | -2.22% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $17,876 | $16,976 | $15,829 | $16,894 | $11,724 | $8,899 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.46% | 1.41% | 1.27% | 1.25% | 1.45% | 2.12%2 |
Portfolio Turnover Rate4 | 2% | 4% | 3% | 5% | 7% | 5% |
The expense ratio and net investment income ratio for the current period have been annualized. |
1 | Calculated based on average shares outstanding. |
2 | Net investment income per share and the ratio of net investment income to average net assets include $1.132 and 0.67%, respectively, resulting from a cash payment received in connection with the merger of and Cigna Corp. And Express Scripts Holding Co. in December 2018. |
3 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $122.27 | $115.84 | $131.26 | $103.87 | $84.91 | $88.57 |
Investment Operations | ||||||
Net Investment Income1 | .889 | 1.711 | 1.583 | 1.450 | 1.351 | 1.8042 |
Net Realized and Unrealized Gain (Loss) on Investments | 10.638 | 6.438 | (15.400) | 27.365 | 18.884 | (3.727) |
Total from Investment Operations | 11.527 | 8.149 | (13.817) | 28.815 | 20.235 | (1.923) |
Distributions | ||||||
Dividends from Net Investment Income | (.887) | (1.719) | (1.603) | (1.425) | (1.275) | (1.737) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.887) | (1.719) | (1.603) | (1.425) | (1.275) | (1.737) |
Net Asset Value, End of Period | $132.91 | $122.27 | $115.84 | $131.26 | $103.87 | $84.91 |
Total Return3 | 9.50% | 7.08% | -10.59% | 28.01% | 24.06% | -2.21% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $2,953 | $2,837 | $2,744 | $2,972 | $1,676 | $1,316 |
Ratio of Total Expenses to Average Net Assets | 0.10%4 | 0.10%4 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.46% | 1.41% | 1.28% | 1.25% | 1.45% | 2.12%2 |
Portfolio Turnover Rate5 | 2% | 4% | 3% | 5% | 7% | 5% |
The expense ratio and net investment income ratio for the current period have been annualized. |
1 | Calculated based on average shares outstanding. |
2 | Net investment income per share and the ratio of net investment income to average net assets include $.566 and 0.67%, respectively, resulting from a cash payment received in connection with the merger of and Cigna Corp. And Express Scripts Holding Co. in December 2018. |
3 | 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. |
4 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
5 | 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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $53,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 20,805,473 | 449 | 501 | 20,806,423 |
Warrants | — | 53 | — | 53 |
Temporary Cash Investments | 46,726 | — | — | 46,726 |
Total | 20,852,199 | 502 | 501 | 20,853,202 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 62 | — | 62 |
E. | As of February 29, 2024, 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 | 16,502,617 |
Gross Unrealized Appreciation | 6,016,277 |
Gross Unrealized Depreciation | (1,665,692) |
Net Unrealized Appreciation (Depreciation) | 4,350,585 |
F. | During the six months ended February 29, 2024, the fund purchased $407,029,000 of investment securities and sold $406,619,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $692,166,000 and $1,293,049,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 817,689 | 3,278 | 1,883,291 | 7,825 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (1,299,166) | (5,450) | (1,627,900) | (6,725) | |
Net Increase (Decrease)—ETF Shares | (481,477) | (2,172) | 255,391 | 1,100 | |
Admiral Shares | |||||
Issued | 188,005 | 1,512 | 391,651 | 3,228 | |
Issued in Lieu of Cash Distributions | 17,140 | 142 | 34,825 | 293 | |
Redeemed | (325,207) | (2,640) | (484,527) | (4,001) | |
Net Increase (Decrease)—Admiral Shares | (120,062) | (986) | (58,051) | (480) |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Aerospace & Defense | 14.9% |
Air Freight & Logistics | 4.1 |
Building Products | 7.3 |
Commercial Services & Supplies | 7.7 |
Construction & Engineering | 2.7 |
Electrical Equipment | 7.7 |
Ground Transportation | 11.6 |
Industrial Conglomerates | 7.1 |
Machinery | 20.0 |
Marine Transportation | 0.2 |
Passenger Airlines | 1.8 |
Professional Services | 9.4 |
Trading Companies & Distributors | 5.5 |
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) |
Illinois Tool Works Inc. | 1/31/25 | CITNA | 5,767 | (5.326) | — | (24) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
CITNA—Citibank, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $4,480,750) | 5,301,128 |
Affiliated Issuers (Cost $16,428) | 16,430 |
Total Investments in Securities | 5,317,558 |
Investment in Vanguard | 152 |
Cash | 604 |
Receivables for Investment Securities Sold | 17,500 |
Receivables for Accrued Income | 9,266 |
Receivables for Capital Shares Issued | 507 |
Total Assets | 5,345,587 |
Liabilities | |
Payables for Investment Securities Purchased | 23,039 |
Collateral for Securities on Loan | 15,260 |
Payables for Capital Shares Redeemed | 114 |
Payables to Vanguard | 198 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 24 |
Total Liabilities | 38,635 |
Net Assets | 5,306,952 |
1 Includes $13,862,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 4,627,321 |
Total Distributable Earnings (Loss) | 679,631 |
Net Assets | 5,306,952 |
ETF Shares—Net Assets | |
Applicable
to 21,376,428 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
4,995,344 |
Net Asset Value Per Share—ETF Shares | $233.68 |
Admiral Shares—Net Assets | |
Applicable
to 2,595,526 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
311,608 |
Net Asset Value Per Share—Admiral Shares | $120.06 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $207.59 | $175.75 | $199.27 | $146.89 | $142.53 | $146.12 |
Investment Operations | ||||||
Net Investment Income1 | 1.600 | 2.829 | 2.432 | 2.264 | 2.366 | 2.597 |
Net Realized and Unrealized Gain (Loss) on Investments | 26.180 | 31.869 | (23.486) | 52.318 | 4.554 | (3.754) |
Total from Investment Operations | 27.780 | 34.698 | (21.054) | 54.582 | 6.920 | (1.157) |
Distributions | ||||||
Dividends from Net Investment Income | (1.690) | (2.858) | (2.466) | (2.202) | (2.560) | (2.433) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.690) | (2.858) | (2.466) | (2.202) | (2.560) | (2.433) |
Net Asset Value, End of Period | $233.68 | $207.59 | $175.75 | $199.27 | $146.89 | $142.53 |
Total Return | 13.48% | 19.99% | -10.62% | 37.41% | 4.96% | -0.73% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $4,995 | $4,493 | $3,461 | $5,438 | $3,090 | $3,457 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.44% | 1.50% | 1.29% | 1.25% | 1.69% | 1.87% |
Portfolio Turnover Rate3 | 3% | 10% | 4% | 5% | 4% | 4% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $106.65 | $90.29 | $102.37 | $75.46 | $73.22 | $75.07 |
Investment Operations | ||||||
Net Investment Income1 | .829 | 1.451 | 1.240 | 1.162 | 1.221 | 1.340 |
Net Realized and Unrealized Gain (Loss) on Investments | 13.449 | 16.376 | (12.056) | 26.880 | 2.336 | (1.941) |
Total from Investment Operations | 14.278 | 17.827 | (10.816) | 28.042 | 3.557 | (.601) |
Distributions | ||||||
Dividends from Net Investment Income | (.868) | (1.467) | (1.264) | (1.132) | (1.317) | (1.249) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.868) | (1.467) | (1.264) | (1.132) | (1.317) | (1.249) |
Net Asset Value, End of Period | $120.06 | $106.65 | $90.29 | $102.37 | $75.46 | $73.22 |
Total Return2 | 13.49% | 19.99% | -10.62% | 37.43% | 4.98% | -0.75% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $312 | $271 | $225 | $372 | $210 | $202 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.46% | 1.49% | 1.27% | 1.25% | 1.71% | 1.87% |
Portfolio Turnover Rate4 | 3% | 10% | 4% | 5% | 4% | 4% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $2,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 5,301,128 | — | — | 5,301,128 |
Temporary Cash Investments | 16,430 | — | — | 16,430 |
Total | 5,317,558 | — | — | 5,317,558 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 24 | — | 24 |
E. | As of February 29, 2024, 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 | 4,507,871 |
Gross Unrealized Appreciation | 1,160,598 |
Gross Unrealized Depreciation | (350,911) |
Net Unrealized Appreciation (Depreciation) | 809,687 |
F. | During the six months ended February 29, 2024, the fund purchased $122,722,000 of investment securities and sold $116,898,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $500,801,000 and $494,913,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 502,423 | 2,332 | 930,187 | 4,752 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (494,965) | (2,600) | (518,694) | (2,800) | |
Net Increase (Decrease)—ETF Shares | 7,458 | (268) | 411,493 | 1,952 | |
Admiral Shares | |||||
Issued | 51,336 | 476 | 91,744 | 925 | |
Issued in Lieu of Cash Distributions | 1,921 | 18 | 2,908 | 31 | |
Redeemed | (47,094) | (442) | (85,738) | (905) | |
Net Increase (Decrease)—Admiral Shares | 6,163 | 52 | 8,914 | 51 |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Communications Equipment | 3.2% |
Electronic Equipment, Instruments & Components | 4.3 |
IT Services | 5.8 |
Semiconductors & Semiconductor Equipment | 29.8 |
Software | 38.7 |
Technology Hardware, Storage & Peripherals | 18.2 |
Futures Contracts | ||||
($000) | ||||
Expiration | Number
of Long (Short) Contracts |
Notional Amount |
Value
and Unrealized Appreciation (Depreciation) | |
Long Futures Contracts | ||||
E-mini NASDAQ 100 Index | March 2024 | 280 | 101,263 | 1,089 |
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) |
Palo Alto Networks Inc. | 8/30/24 | BANA | 46,583 | (5.326) | — | (218) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $54,359,428) | 75,892,796 |
Affiliated Issuers (Cost $247,001) | 247,032 |
Total Investments in Securities | 76,139,828 |
Investment in Vanguard | 2,262 |
Cash | 30,878 |
Cash Collateral Pledged—Futures Contracts | 3,584 |
Cash Collateral Pledged—Over-the-Counter Swap Contracts | 3,770 |
Receivables for Investment Securities Sold | 3,081,853 |
Receivables for Accrued Income | 55,861 |
Receivables for Capital Shares Issued | 13,303 |
Variation Margin Receivable—Futures Contracts | 704 |
Total Assets | 79,332,043 |
Liabilities | |
Payables for Investment Securities Purchased | 3,097,752 |
Collateral for Securities on Loan | 182,518 |
Payables for Capital Shares Redeemed | 29,024 |
Payables to Vanguard | 2,892 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 218 |
Total Liabilities | 3,312,404 |
Net Assets | 76,019,639 |
1 Includes $181,532,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 51,468,021 |
Total Distributable Earnings (Loss) | 24,551,618 |
Net Assets | 76,019,639 |
ETF Shares—Net Assets | |
Applicable
to 124,878,298 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
64,726,501 |
Net Asset Value Per Share—ETF Shares | $518.32 |
Admiral Shares—Net Assets | |
Applicable
to 42,551,804 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
11,293,138 |
Net Asset Value Per Share—Admiral Shares | $265.40 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $444.81 | $349.23 | $426.48 | $328.54 | $213.66 | $202.82 |
Investment Operations | ||||||
Net Investment Income1 | 1.553 | 3.090 | 3.003 | 2.634 | 2.926 | 2.572 |
Net Realized and Unrealized Gain (Loss) on Investments | 73.633 | 95.573 | (77.272) | 97.919 | 114.955 | 10.792 |
Total from Investment Operations | 75.186 | 98.663 | (74.269) | 100.553 | 117.881 | 13.364 |
Distributions | ||||||
Dividends from Net Investment Income | (1.676) | (3.083) | (2.981) | (2.613) | (3.001) | (2.524) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.676) | (3.083) | (2.981) | (2.613) | (3.001) | (2.524) |
Net Asset Value, End of Period | $518.32 | $444.81 | $349.23 | $426.48 | $328.54 | $213.66 |
Total Return | 16.97% | 28.47% | -17.50% | 30.80% | 55.72% | 6.70% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $64,727 | $53,653 | $43,558 | $51,238 | $38,711 | $20,738 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 0.68% | 0.83% | 0.76% | 0.73% | 1.17% | 1.32% |
Portfolio Turnover Rate3 | 8% | 15% | 6% | 4% | 5% | 5% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $227.76 | $178.82 | $218.38 | $168.23 | $109.40 | $103.86 |
Investment Operations | ||||||
Net Investment Income1 | .797 | 1.591 | 1.538 | 1.353 | 1.504 | 1.326 |
Net Realized and Unrealized Gain (Loss) on Investments | 37.702 | 48.931 | (39.572) | 50.136 | 58.864 | 5.509 |
Total from Investment Operations | 38.499 | 50.522 | (38.034) | 51.489 | 60.368 | 6.835 |
Distributions | ||||||
Dividends from Net Investment Income | (.859) | (1.582) | (1.526) | (1.339) | (1.538) | (1.295) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.859) | (1.582) | (1.526) | (1.339) | (1.538) | (1.295) |
Net Asset Value, End of Period | $265.40 | $227.76 | $178.82 | $218.38 | $168.23 | $109.40 |
Total Return2 | 16.97% | 28.47% | -17.50% | 30.81% | 55.78% | 6.70% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $11,293 | $8,783 | $5,994 | $7,301 | $5,149 | $2,470 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 0.68% | 0.83% | 0.75% | 0.73% | 1.17% | 1.32% |
Portfolio Turnover Rate4 | 8% | 15% | 6% | 4% | 5% | 5% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $42,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 75,892,796 | — | — | 75,892,796 |
Temporary Cash Investments | 247,032 | — | — | 247,032 |
Total | 76,139,828 | — | — | 76,139,828 |
Derivative Financial Instruments | ||||
Assets | ||||
Futures Contracts1 | 1,089 | — | — | 1,089 |
Liabilities | ||||
Swap Contracts | — | 218 | — | 218 |
1 | Includes cumulative appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities. |
E. | As of February 29, 2024, 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 | 54,729,981 |
Gross Unrealized Appreciation | 22,625,313 |
Gross Unrealized Depreciation | (1,214,377) |
Net Unrealized Appreciation (Depreciation) | 21,410,936 |
F. | During the six months ended February 29, 2024, the fund purchased $6,234,835,000 of investment securities and sold $5,279,988,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $10,581,743,000 and $8,532,791,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 10,638,6771 | 21,7841 | 16,506,313 | 41,443 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (8,588,381)1 | (17,525)1 | (17,899,600) | (45,550) | |
Net Increase (Decrease)—ETF Shares | 2,050,296 | 4,259 | (1,393,287) | (4,107) |
Six Months Ended February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
Admiral Shares | |||||
Issued | 1,817,041 | 7,545 | 2,150,542 | 10,897 | |
Issued in Lieu of Cash Distributions | 30,963 | 137 | 50,075 | 271 | |
Redeemed | (881,220) | (3,693) | (1,162,226) | (6,126) | |
Net Increase (Decrease)—Admiral Shares | 966,784 | 3,989 | 1,038,391 | 5,042 |
1 | Includes unsettled in-kind transactions as of February 29, 2024 for 9,600,000 issued shares and 9,925,000 redeemed shares valued at $4,944,890,000 and $5,122,229,000, respectively, which settled shortly afterwards. |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Chemicals | 61.3% |
Construction Materials | 7.1 |
Containers & Packaging | 11.4 |
Metals & Mining | 19.6 |
Paper & Forest Products | 0.6 |
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) |
Albemarle Corp. | 1/31/25 | CITNA | 6,479 | (5.326) | — | (23) |
United States Steel Corp. | 8/30/24 | BANA | 10,036 | (5.326) | — | (32) |
— | (55) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. | |
CITNA—Citibank, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $3,748,877) | 4,014,599 |
Affiliated Issuers (Cost $17,461) | 17,462 |
Total Investments in Securities | 4,032,061 |
Investment in Vanguard | 120 |
Receivables for Investment Securities Sold | 14,875 |
Receivables for Accrued Income | 6,198 |
Receivables for Capital Shares Issued | 435 |
Total Assets | 4,053,689 |
Liabilities | |
Due to Custodian | 21 |
Payables for Investment Securities Purchased | 13,968 |
Collateral for Securities on Loan | 7,958 |
Payables for Capital Shares Redeemed | 2,767 |
Payables to Vanguard | 152 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 55 |
Total Liabilities | 24,921 |
Net Assets | 4,028,768 |
1 Includes $6,472,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 3,842,412 |
Total Distributable Earnings (Loss) | 186,356 |
Net Assets | 4,028,768 |
ETF Shares—Net Assets | |
Applicable
to 14,925,712 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
2,882,104 |
Net Asset Value Per Share—ETF Shares | $193.10 |
Admiral Shares—Net Assets | |
Applicable
to 11,655,292 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
1,146,664 |
Net Asset Value Per Share—Admiral Shares | $98.38 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $182.61 | $166.09 | $187.02 | $134.84 | $122.80 | $134.33 |
Investment Operations | ||||||
Net Investment Income1 | 1.590 | 3.253 | 3.213 | 2.801 | 2.522 | 2.501 |
Net Realized and Unrealized Gain (Loss) on Investments | 10.651 | 16.513 | (20.893) | 52.014 | 12.053 | (11.541) |
Total from Investment Operations | 12.241 | 19.766 | (17.680) | 54.815 | 14.575 | (9.040) |
Distributions | ||||||
Dividends from Net Investment Income | (1.751) | (3.246) | (3.250) | (2.635) | (2.535) | (2.490) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.751) | (3.246) | (3.250) | (2.635) | (2.535) | (2.490) |
Net Asset Value, End of Period | $193.10 | $182.61 | $166.09 | $187.02 | $134.84 | $122.80 |
Total Return | 6.77% | 12.09% | -9.55% | 41.00% | 12.12% | -6.73% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $2,882 | $3,070 | $2,889 | $3,924 | $1,676 | $1,921 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.77% | 1.87% | 1.76% | 1.66% | 2.05% | 2.04% |
Portfolio Turnover Rate3 | 3% | 5% | 4% | 5% | 4% | 4% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $93.04 | $84.62 | $95.29 | $68.70 | $62.57 | $68.45 |
Investment Operations | ||||||
Net Investment Income1 | .810 | 1.654 | 1.652 | 1.424 | 1.294 | 1.282 |
Net Realized and Unrealized Gain (Loss) on Investments | 5.423 | 8.420 | (10.665) | 26.507 | 6.130 | (5.892) |
Total from Investment Operations | 6.233 | 10.074 | (9.013) | 27.931 | 7.424 | (4.610) |
Distributions | ||||||
Dividends from Net Investment Income | (.893) | (1.654) | (1.657) | (1.341) | (1.294) | (1.270) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (.893) | (1.654) | (1.657) | (1.341) | (1.294) | (1.270) |
Net Asset Value, End of Period | $98.38 | $93.04 | $84.62 | $95.29 | $68.70 | $62.57 |
Total Return2 | 6.78% | 12.10% | -9.56% | 41.04% | 12.14% | -6.74% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $1,147 | $1,065 | $994 | $1,078 | $583 | $482 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 1.77% | 1.86% | 1.78% | 1.67% | 2.08% | 2.04% |
Portfolio Turnover Rate4 | 3% | 5% | 4% | 5% | 4% | 4% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $3,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 4,014,599 | — | — | 4,014,599 |
Temporary Cash Investments | 17,462 | — | — | 17,462 |
Total | 4,032,061 | — | — | 4,032,061 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 55 | — | 55 |
E. | As of February 29, 2024, 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 | 3,779,419 |
Gross Unrealized Appreciation | 733,974 |
Gross Unrealized Depreciation | (481,332) |
Net Unrealized Appreciation (Depreciation) | 252,642 |
F. | During the six months ended February 29, 2024, the fund purchased $154,195,000 of investment securities and sold $131,781,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $220,665,000 and $530,108,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 225,705 | 1,227 | 492,462 | 2,743 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (530,226) | (3,115) | (564,077) | (3,325) | |
Net Increase (Decrease)—ETF Shares | (304,521) | (1,888) | (71,615) | (582) | |
Admiral Shares | |||||
Issued | 123,786 | 1,363 | 237,053 | 2,655 | |
Issued in Lieu of Cash Distributions | 9,491 | 104 | 17,073 | 200 | |
Redeemed | (115,484) | (1,256) | (278,727) | (3,163) | |
Net Increase (Decrease)—Admiral Shares | 17,793 | 211 | (24,601) | (308) |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |
Electric Utilities | 61.9% |
Gas Utilities | 4.3 |
Independent Power and Renewable Electricity Producers | 3.8 |
Multi-Utilities | 26.0 |
Water Utilities | 4.0 |
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) |
CenterPoint Energy Inc. | 1/31/25 | CITNA | 7,865 | (5.311) | — | (3) |
PG&E Corp. | 8/30/24 | BANA | 18,359 | (5.326) | — | (80) |
— | (83) |
1 | Based on Overnight Bank Funding Rate as of the most recent reset date. Floating interest payment received/paid monthly. |
BANA—Bank of America, N.A. | |
CITNA—Citibank, N.A. |
($000s, except shares, footnotes, and per-share amounts) | Amount |
Assets | |
Investments in Securities, at Value1 | |
Unaffiliated Issuers (Cost $6,618,700) | 6,197,709 |
Affiliated Issuers (Cost $5,097) | 5,098 |
Total Investments in Securities | 6,202,807 |
Investment in Vanguard | 195 |
Cash Collateral Pledged—Over-the-Counter Swap Contracts | 260 |
Receivables for Investment Securities Sold | 18,162 |
Receivables for Accrued Income | 33,782 |
Receivables for Capital Shares Issued | 849 |
Total Assets | 6,256,055 |
Liabilities | |
Due to Custodian | 2,318 |
Payables for Investment Securities Purchased | 27,906 |
Collateral for Securities on Loan | 1,105 |
Payables for Capital Shares Redeemed | 1,066 |
Payables to Vanguard | 237 |
Unrealized Depreciation—Over-the-Counter Swap Contracts | 83 |
Total Liabilities | 32,715 |
Net Assets | 6,223,340 |
1 Includes $1,149,000 of securities on loan. | |
At February 29, 2024, net assets consisted of: | |
Paid-in Capital | 6,836,516 |
Total Distributable Earnings (Loss) | (613,176) |
Net Assets | 6,223,340 |
ETF Shares—Net Assets | |
Applicable
to 35,852,058 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
4,822,081 |
Net Asset Value Per Share—ETF Shares | $134.50 |
Admiral Shares—Net Assets | |
Applicable
to 20,765,673 outstanding $.001 par value shares of beneficial interest (unlimited authorization) |
1,401,259 |
Net Asset Value Per Share—Admiral Shares | $67.48 |
ETF Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $136.43 | $161.46 | $149.52 | $129.35 | $139.09 | $119.32 |
Investment Operations | ||||||
Net Investment Income1 | 2.293 | 4.708 | 4.393 | 4.310 | 4.306 | 4.087 |
Net Realized and Unrealized Gain (Loss) on Investments | (1.699) | (25.005) | 11.897 | 20.048 | (9.802) | 19.562 |
Total from Investment Operations | .594 | (20.297) | 16.290 | 24.358 | (5.496) | 23.649 |
Distributions | ||||||
Dividends from Net Investment Income | (2.524) | (4.733) | (4.350) | (4.188) | (4.244) | (3.879) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (2.524) | (4.733) | (4.350) | (4.188) | (4.244) | (3.879) |
Net Asset Value, End of Period | $134.50 | $136.43 | $161.46 | $149.52 | $129.35 | $139.09 |
Total Return | 0.47% | -12.75% | 11.18% | 19.19% | -4.08% | 20.17% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $4,822 | $5,071 | $6,030 | $5,126 | $4,014 | $4,107 |
Ratio of Total Expenses to Average Net Assets | 0.10%2 | 0.10%2 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 3.45% | 3.19% | 2.87% | 3.09% | 3.18% | 3.22% |
Portfolio Turnover Rate3 | 3% | 4% | 3% | 6% | 5% | 4% |
The expense ratio and net investment income ratio for the current period have been annualized. |
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 0.10%. |
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. |
Admiral Shares | ||||||
For a Share Outstanding Throughout Each Period |
Six Months Ended February 29, 2024 |
Year Ended August 31, | ||||
2023 | 2022 | 2021 | 2020 | 2019 | ||
Net Asset Value, Beginning of Period | $68.45 | $81.00 | $75.01 | $64.89 | $69.78 | $59.86 |
Investment Operations | ||||||
Net Investment Income1 | 1.159 | 2.351 | 2.212 | 2.166 | 2.163 | 2.038 |
Net Realized and Unrealized Gain (Loss) on Investments | (.862) | (12.527) | 5.961 | 10.055 | (4.924) | 9.828 |
Total from Investment Operations | .297 | (10.176) | 8.173 | 12.221 | (2.761) | 11.866 |
Distributions | ||||||
Dividends from Net Investment Income | (1.267) | (2.374) | (2.183) | (2.101) | (2.129) | (1.946) |
Distributions from Realized Capital Gains | — | — | — | — | — | — |
Total Distributions | (1.267) | (2.374) | (2.183) | (2.101) | (2.129) | (1.946) |
Net Asset Value, End of Period | $67.48 | $68.45 | $81.00 | $75.01 | $64.89 | $69.78 |
Total Return2 | 0.46% | -12.73% | 11.22% | 19.22% | -4.05% | 20.19% |
Ratios/Supplemental Data | ||||||
Net Assets, End of Period (Millions) | $1,401 | $1,445 | $1,877 | $1,582 | $1,281 | $1,266 |
Ratio of Total Expenses to Average Net Assets | 0.10%3 | 0.10%3 | 0.10% | 0.10% | 0.10% | 0.10% |
Ratio of Net Investment Income to Average Net Assets | 3.47% | 3.17% | 2.88% | 3.10% | 3.18% | 3.22% |
Portfolio Turnover Rate4 | 3% | 4% | 3% | 6% | 5% | 4% |
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 | The ratio of expenses to average net assets for the period net of reduction from custody fee offset arrangements was 0.10%. |
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. |
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. |
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. |
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 February 29, 2024, custodian fee offset arrangements reduced the fund’s expenses by $1,000 (an annual rate of less than 0.01% of average net assets). |
D. | Various inputs may be used to determine the value of the fund’s investments and derivatives. 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 ($000) |
Level
2 ($000) |
Level
3 ($000) |
Total ($000) | |
Investments | ||||
Assets | ||||
Common Stocks | 6,197,709 | — | — | 6,197,709 |
Temporary Cash Investments | 5,098 | — | — | 5,098 |
Total | 6,202,807 | — | — | 6,202,807 |
Derivative Financial Instruments | ||||
Liabilities | ||||
Swap Contracts | — | 83 | — | 83 |
E. | As of February 29, 2024, 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 | 6,643,934 |
Gross Unrealized Appreciation | 394,938 |
Gross Unrealized Depreciation | (836,065) |
Net Unrealized Appreciation (Depreciation) | (441,127) |
F. | During the six months ended February 29, 2024, the fund purchased $161,685,000 of investment securities and sold $190,183,000 of investment securities, other than temporary cash investments. In addition, the fund purchased and sold investment securities of $404,341,000 and $578,208,000, 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 February 29, 2024 |
Year Ended August 31, 2023 | ||||
Amount ($000) |
Shares (000) |
Amount ($000) |
Shares (000) | ||
ETF Shares | |||||
Issued | 412,389 | 3,133 | 791,370 | 5,346 | |
Issued in Lieu of Cash Distributions | — | — | — | — | |
Redeemed | (580,092) | (4,450) | (804,725) | (5,525) | |
Net Increase (Decrease)—ETF Shares | (167,703) | (1,317) | (13,355) | (179) | |
Admiral Shares | |||||
Issued | 189,186 | 2,831 | 269,479 | 3,578 | |
Issued in Lieu of Cash Distributions | 19,701 | 295 | 41,299 | 562 | |
Redeemed | (232,786) | (3,474) | (458,733) | (6,200) | |
Net Increase (Decrease)—Admiral Shares | (23,899) | (348) | (147,955) | (2,060) |
H. | Significant market disruptions, such as those caused by pandemics, natural or environmental disasters, war, acts of terrorism, or other events, can adversely affect local and global markets and normal market operations. Any such disruptions could have an adverse impact on the value of the fund’s investments and fund performance. |
I. | Management has determined that no events or transactions occurred subsequent to February 29, 2024, that would require recognition or disclosure in these financial statements. |