VanguardÂ® Balanced Index Fund | Wholesale index funds

Vanguard Balanced Index Fund

Vanguard's multi-sector funds use strategic asset allocation targets and a long-term, diversified investment approach. Vanguard takes the worry out of monitoring your investments by expertly selecting and managing the long-term asset allocation of the fund.

Vanguard's Balanced Index Fund is designed for investors seeking a balance between growth and income assets with an average tolerance for risk. The fund offers excellent diversification with exposure to a wide variety of Australian and international assets. The exposure to Australian and international shares and property securities provides opportunities for long-term capital growth while the fixed interest and cash exposure provides a stabilising effect and income.

Who it may suit

medium to long-term investors (usually five years plus)
investors seeking a medium risk, balanced portfolio of growth and income assets
investors seeking a balance between capital growth and capital stability
investors seeking a tax-effective investment

Objectives

To match the weighted average return of the target indexes for each asset class before taking into account fund fees and expenses.

Asset allocation targets are:

Income assets 50%
Cash 22%
Australian fixed interest 11%
International fixed interest (hedged) 17%

Growth assets 50%
Australian shares 24%
International shares 17%
International property securities (hedged) 3%
Australian property securities 3%

International small companies (hedged) 2%
Emerging markets 1%

Benefits

Diversification	a balanced mix (50:50) of growth and income assets diversified approach lowers risk while providing opportunities for enhanced returns
Long-term growth potential and income	potential for long-term some capital growth and income quarterly distributions
Potential for better after-tax returns	our buy and hold strategy takes advantage of capital gains discounts and the deferral of capital gains liabilities, which may result in better after-tax returns
Low fees	low management costs (around half the industry median) no entry fees other than usual buy/sell spreads
Flexiblity	easily switch funds with no costs other than usual buy/sell spreads no minimum additional investment requirements mean you can add to your investment as much and as often as you like

Investment requirements and fees

Minimum investment amounts
Initial investment	$500,000
Additional investments	Nil
Holding balance	Nil
Switch/withdrawal	Nil
Buy/sell spread*
Purchase	+0.20%
Withdrawal	-0.15%
Management costs
Management costs	0.34% p.a.

* Note that the sell spread is an estimate. There may be circumstances where the sell spread will be lower or higher - for example, the sell spread may be higher when there are large or prolonged withdrawals from the fund. In these circumstances, the sell spread could potentially be as much as the buy spread for the fund.

Risk/return profile

At Vanguard, we believe it's just as important to understand the risks and costs of investing, as it is to know about the rewards.

Our risk/return profiler illustrates the expected risk level and potential return for the Vanguard Balanced Index Fund based on historical data. It's important to remember that past performance is no guarantee of future performance and the risk/return profile of each fund may vary from year to year.