Q&A for changes to Vanguard s Ireland-domiciled fund range

Transcription

1 Q&A for changes to Vanguard s Ireland-domiciled fund range As we broaden our presence in Europe, we are able to enhance our product suite by reducing costs and introducing a new share class structure designed to meet the needs of our investors. We remain committed to helping clients build a low cost investment portfolio to meet their investment goals. To help you understand how these changes affect you, we have addressed the most important questions in this Q&A and also provided a complete table of all revisions. If you have further questions you can also contact your Vanguard representative directly. Q&A What is changing? 1. We ve lowered the TERs for existing Investor and Institutional USD, EUR, and JPY share classes of 22 Irish funds 2. We ve also lowered the TERs for the GBP share classes of the Vanguard Emerging Markets Stock and the Vanguard Global Bond 3. Existing Investor and Institutional share classes Minimum Subscriptions and Conversion Thresholds are changing. 4. We ll add 57 new share classes to the Prospectus. You ll find all the relevant details in Appendix 1. Will all 57 new share classes be active on the effective date? No. Not all 57 share classes will be seeded on the effective date. Vanguard will rely on clients to seed the share classes. We have identified 19 priority share classes that we think are most important to our clients. Vanguard will make the remaining 38 share classes available upon client demand. Are the Fund s Investment Objectives and/or Policies changing? No. The changes are isolated to the TERs and share class structure only. Where will the new share classes be registered? The new share classes will be registered in the same jurisdictions as the current share classes EU countries include Denmark, France, Germany, Luxembourg, The Netherlands, Sweden and the UK. The registration of the new shares in Switzerland will take approximately one month from the filing date to clear the Swiss regulator, FINMA. How can I invest in one of the new share classes? Should you wish to invest in one of the 38 new share classes (other than the 19 priority share classes) you can contact your Vanguard representative. Our Client Services Team will then co-ordinate the subscription with you. When are the changes effective? The changes will apply to transactions with a trade date of 3 December 2013 (the effective date )

2 Who is eligible for Investor, Institutional and Plus shares? The conditions for eligibility are as follows: Investor Minimum initial investment of $100,000/ 100,000/ 100,000/YEN 10 million Institutional Minimum initial investment of $5,000,000/ 5,000,000/ 5,000,000/YEN 500 million Plus Minimum initial investment of $/ / /YEN 20 billion Will Vanguard automatically exchange/switch or convert current clients into the new share classes if they are eligible? No. For the same reason Vanguard does not provide individual tax advice, Vanguard will not be advising or forcing a client to exchange/switch or convert their existing shares. The decision to exchange/switch or convert shares lies solely with the client. There may be capital gains tax implications and/or PDL/ADL on redemptions applicable for exchanging/ switching or converting shares for some clients. Clients, therefore, must individually assess their own circumstances and the implications and then instruct Vanguard accordingly. Additional changes to Irish Funds: In tandem with the share class changes, we ve also changed the dealing deadline for the three Vanguard Bond Funds. The current dealing cut-off for purchase and redemptions into the Global Bond (the Fund ) changes from 11:00 AM Irish Time on Trade date minus 1 ( T-1 ) to 12:00 PM Irish Time on Trade date ( T ). The dealing deadlines for Vanguard Euro Investment Grade Bond Index Fund and Vanguard Euro Government Bond are changing from AM Irish Time on Trade Date to PM Irish Time on Trade Date. When is the change effective? The dealing deadline change will be applied to transactions with a trade date of 3 December 2013 (the effective date ). Will the valuation point change? No. The change to the dealing deadline will not affect the valuation point of the Fund. It will remain at end of day U.S. time. Definitions: Exchange/Switch = from one fund to another fund (e.g., Sell EM Stock shares and buy Global Stock shares) Conversion = from one share class to another share class of the same fund (e.g. Global Stock Institutional Share to Global Stock Plus ). Vanguard will not apply a PDL to conversions within the same fund. What happens if I don t meet the new minimum for Institutional i.e. $5m / 5m / 5m / YEN 500m? Will I be moved to Investor? No. No client will be worse off under the proposed changes. You will not be forced to move shares. Who will be affected by the TER reductions? Reductions in TERs affect all holders of the institutional and investor share classes listed in appendix 1. We will automatically apply the revised TERs to current shareholders holdings from the effective date.

3 Appendix 1 Changes to existing Investor and Institutional share classes Conversion Threshold for all existing Investor will change to $5m/ 5m/ 5m/5m/YEN 500m Conversion Threshold for all existing Institutional will change to $200m/ 200m/ 200m/200m/YEN 20billion Minimum Subscription for all existing Institutional will change to $5m/ 5m/ 5m/5m/YEN 500m The TER for the Vanguard Global Bond Pound Sterling Hedged Income will change to 0.20% (from 0.25%) to be in line with the new Investor TER The TER for the Vanguard Global Bond Pound Sterling Hedged will change to 0.20% (from 0.25%) to be in line with the new Investor TER The TER for the Vanguard Emerging Markets Stocks Pound Sterling Income will change to 0.40% (from 0.55%) to be in line with the new Investor TER The TER for the Vanguard Emerging Markets Stocks Pound Sterling will change to 0.40% (from 0.55%) to be in line with the new Investor TER 57 new share classes Ref Name of Sub-Fund Class of ISIN Minimum Subscription or Income Conversion threshold* Offer Price** Global Funds 1 Vanguard Emerging Markets Stock 2 Vanguard Emerging Markets Stock Plus U.S. Dollar IE00BFPM9H50 $ $ $100 Plus Euro IE00BFPM9J Vanguard Global Bond Investor U.S. Dollar Hedged 4 Vanguard Global Bond Plus U.S. Dollar Hedged 5 Vanguard Global Bond Investor Euro Hedged 6 Vanguard Global Bond Plus Euro Hedged 7 Vanguard Global Bond Plus Swiss Franc Hedged 8 Vanguard Global Bond Plus JPY Hedged $100,000 $5,000,000 $100 IE00BFPM9Y26 $ $ $ ,000 5,000, billion 20 billion 10,000 9 Vanguard Global Stock Plus U.S. Dollar IE00BFPM9M04 $ $ $ Vanguard Global Stock Plus Euro IE00BFPM9N Vanguard Global Stock Investor Euro Hedged 12 Vanguard Global Stock Plus Euro Hedged 100,000 5,000, Fixed Income Funds 13 Vanguard U.S. Ultra-Short-Term Bond Fund 14 Vanguard 20+ Year Euro Treasury 15 Vanguard Eurozone Inflation- Linked Bond 16 Vanguard Eurozone Inflation- Linked Bond 17 Vanguard Euro Investment Grade Bond 18 Vanguard Euro Investment Grade Bond 19 Vanguard U.S. Investment Grade Credit Plus U.S. Dollar $ Income $ $100 Plus Euro 100 Plus U.S. Dollar $ $ $100 Plus Euro 100 Plus U.S. Dollar $ $ $100 Plus Euro IE00BFPM9X Plus U.S. Dollar IE00BFPMB022 $ $ $100

4 Ref Name of Sub-Fund Class of ISIN Minimum Subscription or Income Conversion threshold* Offer Price** 20 Vanguard U.S. Investment Grade Credit 21 Vanguard Euro Government Bond 22 Vanguard Euro Government Bond 23 Vanguard Japan Government Bond 24 Vanguard Japan Government Bond 25 Vanguard Japan Government Bond 26 Vanguard U.S. Government Bond 27 Vanguard U.S. Government Bond Plus Euro IE00BFPMB Plus U.S. Dollar $ $ $100 Plus Euro IE00BFPM9W Plus U.S. Dollar $ $ $100 Plus Euro 100 Plus JPY 20 billion 20 billion 10,000 Plus U.S. Dollar IE00BFPM9Z33 $ $ $100 Plus Euro 100 Equity Funds 28 Vanguard Global Small-Cap 29 Vanguard Global Small-Cap Plus U.S. Dollar $ $ $100 Plus Euro IE00BFRTDD Vanguard Global Small-Cap 31 Vanguard Global Small-Cap 32 Vanguard Global Small-Cap 33 Vanguard SRI European Stock Fund 34 Vanguard SRI European Stock Fund 35 Vanguard SRI European Stock Fund Plus Swiss Franc Investor Euro Hedged Plus Euro Hedged ,000 5,000, Plus U.S. Dollar $ $ $100 Plus Euro IE00BFPM9R Plus Swiss Franc 36 Vanguard SRI Global Stock Fund Plus U.S. Dollar $ $ $ Vanguard SRI Global Stock Fund Plus Euro IE00BFPM9S Vanguard SRI Global Stock Fund Plus Swiss Franc 39 Vanguard European Stock 40 Vanguard European Stock 41 Vanguard Eurozone Stock 42 Vanguard Eurozone Stock Plus U.S. Dollar IE00BFPM9K89 $ $ $100 Plus Euro IE00BFPM9L Plus U.S. Dollar $ $ $100 Plus Euro Vanguard Japan Stock Plus U.S. Dollar $ $ $ Vanguard Japan Stock Plus Euro IE00BFPM9P Vanguard Japan Stock Plus JPY 20 billion 20 billion 10, Vanguard Pacific Ex-Japan Stock 47 Vanguard Pacific Ex-Japan Stock 48 Vanguard Switzerland Stock 49 Vanguard Switzerland Stock 50 Vanguard U.S. 500 Stock 51 Vanguard U.S. 500 Stock Plus U.S. Dollar IE00BFPM9Q42 $ $ $100 Plus Euro 100 Plus Euro 100 Plus Swiss Franc Plus U.S. Dollar IE00BFPM9T72 $ $ $ Plus Euro IE00BFPM9V94 100

5 Ref Name of Sub-Fund Class of ISIN Minimum Subscription or Income Conversion threshold* Offer Price** 52 Vanguard U.S. 500 Stock 53 Vanguard U.S. 500 Stock Investor Euro Hedged Plus Euro Hedged 54 Vanguard U.S. Futures Fund Institutional U.S. Dollar 100,000 5,000, $5,000,000 $ $ Vanguard U.S. Futures Fund Plus U.S. Dollar $ $ $ Vanguard U.S. Futures Fund Institutional Euro 5,000, Vanguard U.S. Futures Fund Plus Euro 100 Note: The 19 share classes deemed as high priority are highlighted in light grey.

6 Connect with Vanguard global.vanguard.com This document is directed at professional investors only as defined under the MiFID Directive. Not for Public Distribution. The value of investments, and the income from them, may fall or rise and investors may get back less than they invested. The material contained in this document is not to be regarded as an offer to buy or sell or the solicitation of any offer to buy or sell securities in any jurisdiction where such an offer or solicitation is against the law, or to anyone to whom it is unlawful to make such an offer or solicitation, or if the person making the offer or solicitation is not qualified to do so. The information on this document does not constitute legal, tax, or investment advice. You must not, therefore, rely on the content of this document when making any investment decisions. The KIID and the Prospectus for this fund is available in local languages from Vanguard via our website Manager of Vanguard Investment Series plc is Vanguard Group (Ireland) Limited. Vanguard Asset Management, Limited is a distributor of Vanguard Investment Series plc. Vanguard Investment Series plc has been authorised by the Central Bank of Ireland as a UCITS and has been registered for public distribution in certain EU countries. Prospective investors are referred to the Funds prospectus for further information. Prospective investors are also urged to consult their own professional advisors on the implications of making an investment in, and holding or disposing shares of the Funds and the receipt of distributions with respect to such shares under the law of the countries in which they are liable to taxation. Issued by Vanguard Asset Management, Limited which is authorised and regulated in the UK by the Financial Conduct Authority Vanguard Asset Management, Limited. All rights reserved. VAM