1. How can I access Vanguard's funds?
2. Can I access my client's account information online?
3. Why should I consider recommending Vanguard to my clients?
4. What types of funds does Vanguard offer?
5. How is Vanguard's investment approach different to other fund managers?
6. How does an optimised approach differ from enhanced indexing?
7. Why are Vanguard's funds tax-effective?
8. What information do I receive as an adviser?
9. What additional services are provided to advisers?
10. What ratings do Vanguard's funds have?
11. Why are some of the 2007/08 distributions lower than last year?
1. How can I access Vanguard's funds?
Vanguard's funds are available direct through Vanguard or via a range of platforms.
Investing direct
You can download a PDS and application from our website or call Adviser Services on 1300 655 205. Advisers can also complete applications for Vanguard's Investor Index Funds on behalf of their clients online. After you have completed the online application, print it out and arrange for your client to sign it. Complete online application form
Investing via a platform
Vanguard's funds are available on more than 50 platforms. For the complete list of platforms please click here. This is not an advertisement for the platforms listed. Please refer to the PDS issued by the platform operator.
2. Can I access my client's account information online?
Yes. Vanguard Online is a secure site where you can monitor your client's investments 24 hours a day, seven days a week. To get started, all you need is your client's Investor Number and Personal Identification Number (PIN). Vanguard Online features:
- Investment summary for current account balances, unit prices and number of units
- The latest tax, distribution and quarterly statements
- The last 20 transactions with date, type, value and unit prices
- A facility to update contact details, ask questions or provide feedback using the Mailbox feature.
3. Why should I consider recommending Vanguard to my clients?
With an established pedigree in Australia and the United States, the Vanguard Group has grown into one of the world's largest and most respected investment management companies with more than A$1.3 trillion in funds under management.
This is how we deliver value to your business and clients.
Long-term performance history*
Vanguard aims to deliver superior long-term investment results at low cost. We efficiently manage costs through every stage of the investment process so we can deliver better investment results for your clients.
Smart implementation
Our smart implementation strategies allow you to concentrate on developing the best financial strategies for your clients so you can get on with managing your business.
We aim to deliver benchmark returns not benchmark portfolios. So, rather than holding every security in the index we aim to build portfolios with the optimal number of securities to closely track the index performance without incurring unnecessary costs. So, your clients get all the benefits of holding a diversified portfolio like lower risk and the potential for improved returns, without the associated costs.
High quality, low-cost products
Vanguard offers a wide range of index solutions from single sector to diversified funds in super and non-super products. Our funds are available on more than 50 platforms or you can access them directly from Vanguard. We keep our costs low. In fact, our fees are around half the industry median.
Help for your business and clients
As long-term investment partners, we provide a range of resources to help managing your business and client relationships easier.
*Past performance is not a reliable indicator of future performance.
4. What types of funds does Vanguard offer?
Vanguard provides a range of retail and wholesale index funds, for personal investors, high-net wealth clients, businesses, self managed super funds and trusts. Your clients can invest in asset sector funds such as Australian shares, international shares, emerging markets, Australian property securities, Australian fixed interest, international fixed interest, cash, diversified bonds, high yield Australian shares and hedged international shares. Or they can invest in diversified funds such as conservative, balanced, growth or high growth. There is also a personal super plan. Our funds are available directly through Vanguard or via a range of platforms.
5. How is Vanguard's investment approach different to other fund managers?
As an index fund manager, Vanguard structures its portfolio to closely track the performance of a specified market index, allowing for efficient portfolio management.
We believe a long term approach to investing delivers the best results. That's why we buy and hold stocks with long term growth in mind, rather than actively trading them in pursuit of short-term gains.
We manage costs wherever we can so your clients can keep more of the returns they earn. Because we hold stocks for the long term we have lower turnover than many active funds. Lower turnover means lower costs and tax, which can lead to better real returns for investors in the long run.
Our approach focuses on the end result. That is, the return your clients take home after expenses and tax. An example of this is the way we take advantage of capital gains discounts to minimise the tax impact for investors.
Instead of holding every security in an index, we aim to build portfolios with the optimal number of securities to closely track the index performance without incurring unnecessary transaction costs. It's what we call optimised indexing. This way investors get all the benefits of holding a diversified portfolio like lower risk and the potential for improved returns, without the associated costs.
6. How does an optimised approach differ from enhanced indexing?
Optimisation-based processes seek to determine the appropriate number of securities to hold to deliver the full market return while taking into account the structure of the index (distribution of marketcap weight; which markets; the number of securities), and the nature (the size and frequency) of portfolio capital flow activity.
Enhanced indexing is really low-risk active management. A better way to describe it is as structured quantitative processes designed to capture a factor, or characteristic, the portfolio manager believes will outperform over time. These processes still run the risk of underperforming their benchmark and shouldn't be considered as an "index plus" strategy.
Enhanced indexing processes may also have reduced after-tax returns compared with an optimised approach, simply because of increased portfolio activity. Enhanced indexing turnover averages around 20% to 50% pa compared to typical benchmark turnover of 5 to 10%. Vanguard's funds' average turnover is currently around 2 to 5%. This is due to the reduced number of securities held and positive cashflow, which avoid the need for the fund to sell existing assets to acquire new index assets.
7. Why are Vanguard's funds tax-effective?
Our "buy and hold" strategy takes advantage of capital gains discounts and the deferral of capital gains liabilities, which can result in better after-tax returns for investors.
Index fund managers typically turn their portfolios over less often than active managers. As distributions of capital gains are taxable, there is a definite advantage in deferring their realisation for as long as possible. If securities are held for more than 12 months, any capital gain on the disposal of those securities will attract a lower rate for investors eligible for the capitals gains discount.
Vanguard also uses crossing strategies to minimise the impacts of cashflows. Crossing refers to the process of matching redemption and application monies to avoid having to buy securities on market, which can provide both tax and cost savings when passed onto the investor.
8. What information do I receive as an adviser?
To keep you abreast of important industry topics, investment issues and product and performance updates, Vanguard provides advisers with regular publications, including the Bridge and our monthly adviser e-newsletter FASTnews. In addition, we publish a range of adviser brochures, including our credentials brochure, which explains how Vanguard can deliver value to your business and clients, and a range of product fliers explaining the benefits and features of each index fund.
We also offer a wide range of educational material, our popular index chart, after-tax reporting, web tools and calculators you can use with your clients.
9. What additional services are provided to advisers?
As long-term investment partners, Vanguard works alongside advisers to help you and your clients meet your objectives. We offer a range of resources to help make managing your business and client relationships easier, including:
- Adviser Services call centre
- After-tax reporting
- Web tools and resources
- Adviser communications
- Investor education
- Research library
- Index chart - print and online versions
10. What ratings do Vanguard's funds have?
Please click here for current ratings.
11. Why are some of the 2007/08 distributions lower than last year?
The 2007/08 financial year was one of the most volatile in 20 years. As a direct result distributions from Vanguard's range of index funds have been impacted in varying ways. You can access a detailed report below for further information.
Vanguard_Investor_Index_Funds0708.pdf (PDF - 18KB) Vanguard_Index_Funds0708.pdf (PDF - 26KB)
