Benefit from the Vanguard difference

Transcription

1 Benefit from the Vanguard difference

2 Contents 2 About Vanguard 3 An enduring investment philosophy 4 A different way to invest 6 An indexing leader 7 A trusted partner for advisors in Canada 8 Contact us

3 We believe our unique offer of low costs, client focus and enduring investment solutions will resonate with Canadian investors. F. William McNabb III Chairman and CEO The Vanguard Group, Inc. 1

4 About Vanguard Key fact Vanguard has more than $3.1 trillion in assets under management worldwide. Since establishing the first index mutual fund for individual investors in 1976, The Vanguard Group, Inc. (Vanguard) has become one of the world s largest investment management companies. Today our clients entrust us with more than $3.1 trillion in assets under management. Our growing asset base also includes more than $445 billion in exchangetraded funds. Over the past three decades, Vanguard has expanded its offerings to partner with financial advisors and institutional investors in key global markets within Europe/United Kingdom, Asia and Australia. We attribute our growth to years of meeting our clients needs through our unique offer of low costs, client focus and enduring investment solutions. At Vanguard, we also understand that in the financial business reputation is everything. Over the years, we ve built a sterling reputation for ethics and integrity and looking out for the best interests of our clients. We look forward to continuing this way of doing business as we partner with investment advisors in Canada. With investors increasingly focused on costs and quality, we believe the time is right to provide your clients with access to high-value investments that can help them meet their investment goals and help you grow your business. All figures are as of December 31,

5 An enduring investment philosophy Key fact Vanguard s approach to investing doesn t change with market fads. Since Vanguard s beginning, we have been committed to four principles that guide our fund management and investment programs. We believe that investors should: Create clear, appropriate investment goals. Investors should set measurable and attainable investment goals and develop plans for reaching those goals. Investors with multiple goals (e.g., retirement planning and college savings) should have a separate plan for each. Finally, they should evaluate their plans on a regular, ongoing basis. Develop a suitable asset allocation using broadly diversified funds. A successful investment strategy starts with an asset allocation suitable for its objective. Investors should establish an asset allocation using reasonable expectations for risk and returns. The use of diversified investments helps to ensure against exposure to unnecessary risks. Minimize cost. Every dollar that investors pay for management fees or trading commissions is a dollar less of potential return. Research also suggests that lower-cost investments have tended to outperform higher-cost alternatives. Investors can t control the markets, but they can control the effects of costs. 1 Maintain perspective and long-term discipline. Investing evokes emotion that can disrupt the plans of even the most sophisticated investors. Some investors may make rash decisions based on market volatility. Discipline and perspective can counter that emotion if the investor adopts a systematic approach to investing that applies the principles of asset allocation and diversification and then sticks to it. 1 Source: Vanguard s Principles for Investing Success, July 2014, p

6 A different way to invest Key fact The average management fee of our Canada-domiciled ETFs is 0.22%. 2 Vanguard Investments Canada Inc. is a subsidiary of Vanguard. As such, Canadian investors benefit from Vanguard being one of the world s largest investment management companies and a very different kind of investment firm. The distinction stems from Vanguard s unique ownership structure. Rather than being publicly traded or owned by a small group of individuals, The Vanguard Group, Inc. is owned by its U.S.-domiciled funds and ETFs. Those funds, in turn, are owned by their investors. This unique mutual structure aligns our interests with those of our investors and drives the culture, philosophy and policies throughout the Vanguard organization worldwide. As a result, Canadian investors benefit from Vanguard s low costs, client focus, and stability and experience. 2 Management fees are averages: Investors may not experience similar savings by investing in Vanguard ETFs. Actual management fees for Vanguard ETFs may be higher or lower than this average figure. 4

7 The Vanguard difference Low costs Investors can t control the markets, but they can control the costs of investing. Providing low-cost investments isn t a pricing strategy for us. It s how we do business. We can keep costs low because of our unique ownership structure in the United States, which allows us to return profits to investors through lower costs. Vanguard s scale also helps to keep costs low. As our assets under management increase globally, we can reduce expense ratios for the investors in our funds. Client focus The ownership structure of The Vanguard Group, Inc. aligns our interests with those of our clients. Because Vanguard is not publicly traded, we can extend the benefits of that structure to our clients in Canada. From rigorous risk management to transparent pricing to Plain Talk communications, we put our clients interests first. Everything we do at Vanguard is designed to give our clients the best chance for investment success. Stability and experience In Canada, Vanguard leverages the scale, experience and resources of our established global business. Vanguard s ownership structure means that our clients don t have to worry that we ll be acquired. The company they invest with today will continue to serve them in the future. 5

8 An indexing leader Key fact Vanguard pioneered indexing investing for retail investors almost 40 years ago. Indexing is a powerful strategy for capturing market returns through broad market exposure. An indexed approach with a longterm investment horizon can limit turnover, minimizing transaction expenses that reduce investment returns. When you invest with Vanguard, you have almost 40 years of index investing experience behind you. Vanguard launched the first equity index mutual fund for individual investors in the United States in Funds based on bond and international indexes followed in 1986 and We ve since applied our index management expertise to exchange-traded funds. As we ve developed proprietary software and sophisticated techniques for portfolio construction, risk management and trading, we ve also grown in size, scale and experience. Investors benefit through tight, low-cost benchmark tracking. Of course, an index investment is only as good as the benchmark it seeks to track. We select only market-capitalization benchmarks, which objectively reflect broad markets or market segments and thus minimize investment costs. Many index providers use benchmark construction best practices that Vanguard has promoted for years an industry endorsement of our leadership. 6

9 A trusted partner for advisors in Canada Key fact Vanguard leads the U.S. ETF market in almost every area of the advisor experience and is the leader in advisor loyalty. (Cogent Research Advisor Brandscape, 2014). Vanguard has become a key partner to financial advisors because we understand your business. Your success depends on the confidence of your clients. By delivering low-cost, high-quality investments and research-driven insights, Vanguard helps you earn and keep your clients trust. We launched operations in Canada in 2011 in response to the changing needs of the Canadian advisor market. Advisors are increasingly moving from a transaction-based approach to a fee-based model. We have partnered with advisors making this transition in the United States, Australia and the United Kingdom, and we feel we have much to contribute to advisors adapting to the new model, including: Low-cost ETFs Vanguard s indexing expertise is available through Canadadomiciled ETFs that seek to track the performance of marketcapitalization-weighted indexes representing Canadian and U.S. stocks, international stocks, Canadian real estate and Canadian bonds, making it even easier to build low-cost, well diversified portfolios. The Canada-domiciled Vanguard ETFs are managed by Vanguard Investments Canada Inc. Thought leadership We provide research-driven insights into the topics foremost in advisors minds, as well as education and tools to help you build your practice. Plain Talk Our candid approach to addressing market events and investment topics provides context for discussions that help you help your clients make informed choices. A trusted name Vanguard is a name that investors around the world have come to know for our commitment to serving our clients interests. 7

10 Contact us If you would like to learn more about our products in Canada or about how we can help you build your practice, please visit our website, vanguardcanada.ca, call us at , or write to us at the address below. Vanguard Investments Canada Inc. 155 Wellington Street West Suite 3720 Toronto, ON M5V 3H1 8

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12 Vanguard Investments Canada Inc. 155 Wellington Street West Suite 3720 Toronto, ON M5V 3H1 Connect with Vanguard vanguardcanada.ca Commissions, management fees, and expenses all may be associated with investments in a Vanguard ETF. Investment objectives, risks, fees, expenses, and other important information are contained in the prospectus; please read it before investing. ETFs are not guaranteed, their values change frequently, and past performance may not be repeated. Vanguard ETFs are managed by Vanguard Investments Canada Inc., an indirect wholly-owned subsidiary of The Vanguard Group, Inc. First date of publication: March 31, This material is for informational purposes only. This material is not intended to be relied upon as research, investment, or tax advice and is not an implied or express recommendation, offer or solicitation to buy or sell any security or to adopt any particular investment or portfolio strategy. Any views and opinions expressed do not take into account the particular investment objectives, needs, restrictions and circumstances of a specific investor and, thus, should not be used as the basis of any specific investment recommendation. In this material, references to Vanguard are provided for convenience only and may refer to, where applicable, only The Vanguard Group, Inc., and/or may include its affiliates, including Vanguard Investments Canada Inc. Information, figures and charts are summarized for illustrative purposes only and are subject to change without notice. The management fee is equal to the fee paid by the Vanguard ETF to Vanguard Investments Canada Inc. and does not include applicable taxes or other fees and expenses of the Vanguard ETF. For any Vanguard ETF which invests in underlying Vanguard fund(s), there shall be no duplication of management fees chargeable in connection with the Vanguard ETF and its investment in the Vanguard fund(s). For financial advisor use only. Not for public distribution. All investments, including those that seek to track indexes, are subject to risk, including the possible loss of principal. Diversification does not ensure against a profit or protect against a loss in a declining market. While ETFs are designed to be as diversified as the original indexes they seek to track and can provide greater diversification than an individual investor may achieve independently, any given ETF may not be a diversified investment Vanguard Investments Canada Inc. All rights reserved. ABVG