you and vanguard aligned for your clients’ success · pdf fileyou and vanguard aligned...

Y O U A N D V A N G U A R D

Aligned for your clients’ success™

FOR FINANCIAL ADVISORS AND INSTITUTIONS ONLY. NOT FOR PUBLIC DISTRIBUTION.

Your day is long and challenging. You take care of your practice, your employees, your clients, and your friends and family. Once in a while, you have time for yourself.

Your industry is changing, giving clients more alternatives—and you more competition.

Your goals are big. You do so much more than financial planning. You are a business owner, a leader in your community, and a behavioral coach. You are the trusted voice of reason for your clients.

Here’s how Vanguard can help.

Y O U H A V E M A N Y G O A L S F O R

Your practiceYou’re building your practice so clients win and you do too. As an advisor, you look to differentiate your value, stave off your competition, and increase your income. We share your goals and are aligned with you to help build your practice.

Our advisor’s alpha research can guide your discussions with clients.

It helps clients understand that you can add as much as 3 percentage points of value to their portfolios over time by using key principles, such as behavioral coaching.

Vanguard’s proprietary research helps you stay in the know.

Stay up to date on market and world events with our research, which offers deep dives on topics that matter the most to you. White papers and presentations are master classes on key subjects, such as ETFs, portfolio construction, wealth management, and generational planning. Our partnerships with outside research firms, such as Spectrem Group, give you insights into client behavior.

It’s7 a.m.

Providefee flexibility

Keep up with trends

Marketcheck

Clientprep

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Vanguard Advisor’s

Alpha™

150+bps

0–105bps

0–120bpsAbout 3%

Vanguard Advisor’s

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How Vanguard can help

Vanguard mutual funds and ETFs can lower clients’ all-in costs.

Vanguard’s reputation for integrity communicates your commitment to selecting low-cost investments that give your clients the best chance to increase their wealth.

Low cost is in our DNA

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Morningstar industry asset-weighted average (excluding Vanguard)Lipper industry straight average

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Sources: Vanguard; Morningstar, Inc.; and Lipper, a Thomson Reuters Company, as of December 31, 2016.

Spotlight onyour practice

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Leverage expert

commentary

Streamline investing

Adding passive investments to actively managed portfolios Exploring active/passive scenarios via the Portfolio Analytics tool

De�ne value proposition

Wealthmanagement

Loyalty/retention


Recouptime

Behavioral coaching

Deep and lastingclient relationships

De�ne value proposition

Wealthmanagement

Loyalty/retention


Recouptime

Behavioral coaching

Deep and lastingclient relationships

Demonstrate your value

Spectrem Group research briefs

Putting a value on your value: Quantifying your value to your clients

Learn about saving for college

ETF Knowledge Center™

ETF Capital Markets Team trading expertise

Quantifying your value to your clients

Vanguard Advisor’s Alpha® tool kit

Quarterly economic and investment outlook

Advisor continuing education credits

Vanguard Blog for AdvisInsights and updates for financial professionals

Home Economy & Markets ETFs Portfolio Const

The greatest risk in the marketJoe Davis I September 29, 2014 I Topics: Economy & Mar

Vanguard ETF® strategic model portfolios

Portfolio Analytics tool and consulting services

Vanguard Retirement Plan Access™ Small Market 401(k)

Investor Education guides

SensitiveYou added 6 product. Click Apply to see results.

100%

Advice about social media


Your timeIf only you had more. Every day, every minute is spoken for. You need an investment partner that can help you make efficient decisions so you have more time to deepen client relationships and expand your practice.

Your to-do list is 20 items long—and growing.

You are wondering how a turbulent stock market will affect plans to sell a client’s ETF. You need to prepare for three client meetings. And you’re wishing you were able to attend an industry conference you found invaluable last year.


You check in at Vanguard’s ETF Knowledge Center.

You read up on how market volatility affects bid-ask spreads. Because your client’s trade is large, you call Vanguard’s ETF Capital Markets Team to help ensure the best execution.

It’s7 a.m.


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Next up: You prep for client meetings.

You hop on to Vanguard’s Portfolio Analytics tool to create customized reports, complete with clients’ names and holdings.

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You have some extra time.

You read the latest financial research on Vanguard’s LinkedIn page for financial advisors and check out the Vanguard Advisors Twitter feed for updates from that industry conference you couldn’t attend. It’s almost like being there.

During a review, a client expresses interest in a short-term bond fund. You tap the Vanguard for Advisors app on your tablet to bring up data about options in that fund category. You also share client-approved materials on bond investing from Vanguard’s advisor website.

You use Vanguard’s time-saving products and services.

This allows you to put more resources where they matter most—into getting to know your clients and developing new ones.

It’s7 a.m.


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Leverage expert

commentary



Global Macro Matters: Short economic updates

One of the industry’s largest wholesale sales forces

Vanguard Client Relationship Center™

Advisor continuing education credits

Vanguard ETF strategic model portfolios

Portfolio Analytics tool and consulting services

Vanguard’s advisor app

www.abcadvisors.com 100 Main Street • Anywhere, USA 12345 • 123.456.7890

Hours: Monday through Friday 9:00am - 5:00pm

How we communicate with youWe offer scheduled planning reviews, regular check-ins, ongoing education opportunities, and an informative client newsletter. You can also count on a response within 24 hours whenever you contact us with a question or concern.

Our fee structureOur investment advisory practice is fee-based. Our annual advisory fees are calculated simply as a percentage of assets under management. Our fees are not based on trading activity or commissions. The table below reflects what our fees may look like for you.

AMOUNT MANAGED ADVISORY FEE FEE CALCULATION

Up to $X X% $X

$X to $X X% $X to $X

More than $X X% $X

Additional charges may apply based on planning needs. Consult your advisor for fee arrangements specific to your circumstances.

Our servicesWe offer a range of planning resources and services to help you reach your goals:

• Comprehensive portfolio management• Periodic reviews • Financial planning • Investment strategies

• Ongoing investment monitoring• Insurance solutions • Cash flow and tax planning • Coordination with other professionals

• Wealth management • Income distribution • Estate planning • Retirement planning

Prepared for: Mr. and Ms. John and Jane Doe

Our commitment to youWe are dedicated to helping you achieve your investment goals by providing personal attention and quality services.

How we help you succeedWe provide cost-efficient portfolio construction, comprehensive wealth management, and ongoing discussions to earn your confidence and help you achieve your goals.

Discuss options

Create and implement your plan

Monitor your plan

Discuss updates and observations

Gather information about your situation

Evaluate your

situation

Understand your goals

REACH YOUR GOALS | MAINTAIN CONFIDENCE | BALANCE RISK, REWARDS

Jane C. Smith, CFP®

Vanguard’s advisor website

Portfolio Review Group

Social media updates

Research & commenInfographicApril 7, 2015

Learn more aboutredefining how ad

Fairly anaApril 6, 2015

Jim Rowley discutracking error.

Vanguard Blog for Advisors™

Customizable client documents

Van

Home

Client Relationship Center™

Resources for building a stronger client engagement™

®

• Create and evaluate client portfolios

• Compare two portfolios

• Create and add a custom benchmark

Quick info

Vanguard Portfolio Analytics

Thought leadership

It’s7 a.m.


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It’s7 a.m.


Keep up with trends

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It’s7 a.m.


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Marketcheck

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Your clientsYou know that beating the market is tough. You do so much more than pick investments. You coach your clients to achieve their goals, teach them to be persistent and disciplined about investing, and counsel them about complex financial decisions. You need products and services that build wealth and help you explain the value you create.

Clients know and recognize the Vanguard name.

Clients know that you use Vanguard mutual funds and ETFs because they are widely recognized for providing strong relative performance at low cost. Our brand builds your brand. Clients can appreciate how carefully you listen and then create plans that help them achieve their goals.

Vanguard Advisor’s Alpha materials help your clients see the benefits of your philosophy.

With these materials, clients learn about how you can help them increase their wealth through behavioral coaching, portfolio rebalancing, and other best practices. This may lead them to recommend you to their friends.

Your clients appreciate how well you know them.

At the Vanguard Client Relationship Center, you will find all the tools, materials, and coaching tips you need to cultivate client relationships, including onboarding and investment-review documents, ideas for discussing the value you add, and helpful hints for teaching clients key investing principles.



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1 Source: Lipper, a Thomson Reuters Company. Number of Vanguard funds that outperformed their Lipper peer-group averages for the ten-year period ended December 31, 2016: For the period, 206 of 224 Vanguard funds outper-formed their Lipper peer-group averages. Results will vary for other time periods. Only funds with a minimum ten-year history, were included in the comparison.2 Source: Lipper, a Thomson Reuters Company. Number of Vanguard ETFs that outperformed their Lipper peer-group averages for the ten-year period ended December 31, 2016: For the period, 23 of 27 Vanguard ETFs outperformed their Lipper peer-group averages. Results will vary for other time periods. Only ETFs with a minimum ten-year history were included in the comparison.Note that the competitive performance data shown represent past performance, which is not a guarantee of future results, and that all investments are subject to risks. For the most recent performance, visit our website at vanguard.com/performance.

3 Vanguard’s total assets under management, as of December 31, 2016.

Leverage expert

commentary


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Vanguard Investment Strategy Group research

Putting a value on your value: Quantifying your value to your clients

Learn about indexing

BEH AV IOR A L COACHING

VanguardAdvisor’sAlpha™

Portfolio comparison and other tools

Vanguard Blog for Advisors™

Vanguard client-approved materials

Vanguard trading experts can help ensure smooth trade execution

U.S. investors should consider the potential diversification benefits of investing in other countries’ equity markets. Less-than-perfect correlation of other developed economies’ equity markets with the U.S. equity market produces returns that can vary from the returns of U.S. stocks alone. This paper summarizes the existing Vanguard research Global equities: Balancing home bias and diversification (Philips, 2014).

Equities not domiciled in the United States accounted for 51% of the global equity market as of December 31, 2013,1 reflecting a significant opportunity for portfolio diversification.

Although no one answer fits all investors, empirical and practical considerations suggest a reasonable starting allocation to non-U.S. stocks of 20%, with an upper limit based on global market capitalization, subject to the investor’s perspective on the short- and long-term trade-offs.

The case for investing in non-U.S. stocks

As of December 31, 2013, non-U.S. equities, including those of developed countries such as Germany, Japan, and the United Kingdom, plus those of emerging markets countries such as Brazil, India, and China, made up 51% of the global equity market.

Despite the size of non-U.S. equity markets (as shown in Figure 1, on page 2), U.S. mutual fund investors, on average, held only 27% of their total equity allocations in non-U.S.-domiciled funds as of year-end 2013, according to Morningstar, Inc. Although this is within the 20% to 40% range we recommend, it falls at the lower end of that range. While U.S. investors, on average, are not exploiting the optimum benefits of global diversification,

their portfolios are more diversified than those who invest solely in the U.S. stock market and exclude more than one-half of the global opportunity set.

The rationale for diversification of investment across a global market is clear. U.S. stocks are exposed to U.S. economic and market forces, while stocks domiciled outside the United States offer exposure to a wider array of economic and market forces.

All else being equal, U.S. investors should realize a diversification benefit from investing globally because the equity markets of other developed economies are less-than-perfectly correlated with the U.S. equity market. These differing economies and markets produce returns that can vary from those of U.S. stocks.

While individual countries experience greater volatility at times than that of the United States, the broad MSCI World Index ex USA (which focuses on developed markets) has experienced volatility similar to that of the United States (as shown in Figure 2, on page 2).

The broadest global index—representing the combined MSCI USA Index, the MSCI World Index ex USA, and the MSCI Emerging Markets Index—has experienced the lowest average volatility.

Global equities: Balancing home bias and diversification Fourth quarter 2014


1 Sources: Thomson Reuters Datastream and MSCI.

Vanguard Client Relationship Center™

Winning the advisor’s gameFamed investor Charles Ellis explains how financial advisors can succeed by focusing on individual clients’ needs and priorities.

Spring 2015

ETF Perspectives Vanguard insights for financial advisors™

Strong reputation of Vanguard mutual funds and ETFs

Vanguard wholesalers available to provide data and answer questions quickly

Articulating your value

Clients value long-term performance

Over the last ten years

of all Vanguard funds outperformed their Lipper peer-group averages1

of all Vanguard ETFs® outperformed their Lipper peer-group averages2

92%85%

More advisors, and their clients, are choosing Vanguard

35%$3.9 trillion assets under management3

Vanguard Financial Advisor Services

About $1 of every $3 invested at Vanguard comes through a financial advisor

$3.1trillion1

Building your investment

StructuresLearn how ETFs are organized fromwell as the tax implications of the var

20162007

$1.4 trillion

$260 billion

Vanguard Financial Advisor Services™

Assets under management

Source: Vanguard, as of December 31, 2016.

Contact Vanguard Financial Advisor Services at 800-997-2798 or visit us on the web at advisors.vanguard.com

Want more?

You and VanguardAligned for your clients’ success

© 2017 The Vanguard Group, Inc. All rights reserved. U.S. Patent Nos. 6,879,964; 7,337,138; 7,720,749; 7,925,573; 8,090,646; and 8,417,623. Vanguard Marketing Corporation, Distributor.

FAPASB 062017

Vanguard Financial Advisor ServicesTM

P.O. Box 2900Valley Forge, PA 19482-2900

All investing is subject to risk, including possible loss of principal.

Past performance is not a guarantee of future returns.

Vanguard ETF Shares are not redeemable with the issuing Fund other than in very large aggregations worth millions of dollars. Instead, investors must buy and sell Vanguard ETF Shares in the secondary market and hold those shares in a brokerage account. In doing so, the investor may incur brokerage commissions and may pay more than net asset value when buying and receive less than net asset value when selling.

For more information about Vanguard funds and Vanguard ETF Shares, visit advisors.vanguard.com or call 800-997-2798 to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information are contained in the prospectus; read and consider it carefully before investing.

Connect with Vanguard® > advisors.vanguard.com > 800-997-2798

Investment Products: Not FDIC Insured • No Bank Guarantee • May Lose Value


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