P.O. Box 2600
		Valley Forge, PA 19482-2600
		610-669-1605
		brian_p_murphy@vanguard.com
September 4, 2018
Lisa N. Larkin, Esq.
U.S. Securities and Exchange Commission		via electronic filing
100 F Street, N.E.
Washington, DC 20549
RE: Vanguard Scottsdale Funds (the “Trust”)
File No. 33-11763
Post-Effective Amendment No. 53 – Vanguard Total World Bond ETF (the “Fund”)
Dear Ms. Larkin,
This letter responds to your comments provided on July 10, 2018, to the above referenced post-effective
amendment.
Comment 1:	Securities Act Rule 140
Comment:	Under Rule 140 of the Securities Act of 1933 (the “Securities Act”), as amended, the
	Fund could be considered to be engaged in the distribution of the securities of two
	affiliated issuers. In similar situations, such as in a master-feeder arrangement, the Staff
	requires the feeder funds’ registration statement: (1) to be signed by the master fund and
	(2) to contain all of the relevant information of the master fund. Please provide an
	analysis as to whether such requirements relating to Rule 140 are warranted here. See
	Letter from Richard Breeden to the Hon. John Dingell (Apr. 15, 1992).
Response:	We do not believe that the Fund would be engaged in the distribution of shares of
	Vanguard Total Bond Market Index Fund and Vanguard Total International Bond Index
	Fund (together, the “Underlying Funds”) under Rule 140 under the Securities Act. We
	also do not believe that the investment program of the Fund is similar to a master-feeder
	arrangement or that the disclosure requirements that normally apply to master-feeder
	arrangements would be warranted for the Fund.
	Rule 140 under the Securities Act states in pertinent part that “[a] person, the chief part of
	whose business consists of the purchase of the securities of one issuer, or of two or more
	affiliated issuers, and the sale of its own securities to furnish the proceeds with which
	to acquire the securities of such issuer or affiliated issuers, is to be regarded as engaged in
	the distribution of the securities of such issuer or affiliated issuers within the meaning of
	section 2(a)(11) of the [Securities] Act.”
	We understand that Rule 140 was adopted to curb abuses in the underwriting of securities
	by persons whose primary business was the purchase and sale of securities. The Rule

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September 4, 2018

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provides that if the “chief part” of an issuer’s business is to use proceeds from the sale of

its own securities to purchase another issuer’s securities, then the purchasing issuer may

be considered an underwriter effecting a distribution of the securities of the other issuer.

The SEC has interpreted the rule to deem the issuer of the security that is being purchased

with the proceeds from the sale of the other security to be a co-issuer of the other

security, and has required both entities to sign the registration statement of the other

security. This interpretation of the Rule serves to prevent the circumvention of the

registration process by the issuer of the underlying security.

In the case of the Fund, the sale of shares would not furnish the proceeds with which the

Fund would acquire the securities of the Underlying Funds. As a general matter, shares

of the Fund would be purchased by Authorized Participants through in-kind transactions

where an Authorized Participant presents shares of the Underlying Funds to the Fund.

The Fund would have no influence or control over the circumstances under which an

Authorized Participant obtains shares of the Underlying Funds. Authorized Participants

may have held shares of the Underlying Funds in inventory for a long period of time,

may have recently acquired shares of the Underlying Funds in the secondary market, or

may have acquired shares directly from the Underlying Funds through their creation

processes. Regardless of the way in which the Authorized Participants acquire shares of

the Underlying Funds, the Fund would not furnish proceeds to the Underlying Funds,

including as part of any effort to distribute shares of the Underlying Funds. As a result,

Rule 140 would not appear to apply.

In addition, a purchaser of the Fund would become a shareholder in a registered

investment company with its own distinct investment objective, operations, and expenses,

and not an owner of shares of the Underlying Funds. In this regard, the shares to be

issued by the Fund would be materially different from the shares issued by the

Underlying Funds. The NAV of shares of the Fund would not merely reflect the market

prices or NAV of any one of the Underlying Funds, but rather the combination of the

value of the shares of the Underlying Funds and any other assets and liabilities of the

Fund, as determined in compliance with the Investment Company Act of 1940 (“1940

Act”). A purchaser of shares of the Fund therefore would be making an investment

decision with respect to a markedly different security than the securities issued by the

Underlying Funds. In fact, because shares of the Underlying Funds are separately

registered under the Securities Act and the 1940 Act and are readily available to

investors, the very reason to purchase shares of the Fund would be to purchase a security

with economic characteristics that are different than the economic characteristics of the

Underlying Funds individually.

In this regard, the Fund is notably different than a master-feeder arrangement, and the

disclosure requirements that normally apply to master-feeder arrangements would not be

warranted for the Fund. As described in the report cited by the SEC staff (the “Master-

Feeder Report”), in a master-feeder arrangement, the feeder fund invests exclusively in

the shares of the master fund and essentially serves as a conduit for investment in the

master fund. The feeder fund registers its securities under the Securities Act and the

1940 Act, while the master fund does not register its shares under the Securities Act

because its shares are not publicly offered. As explained in the Master-Feeder Report,

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September 4, 2018

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	the SEC staff did not insist that the master fund register its securities under the Securities
	Act because the SEC staff viewed the master fund as the co-issuer of the feeder fund’s
	securities in accordance with Rule 140. The SEC staff noted that “[a]s co-issuer of the
	[feeder] fund’s securities, the [master] fund signs the [feeder] fund’s registration
	statement registering the [feeder] fund’s securities	That registration statement must
	also include disclosure about the [master fund] equivalent to that which investors would
	receive if the [master] fund registered its securities separately.”
	Accordingly, the reason for the master fund to sign the registration statement of the
	feeder fund is to avoid the circumvention of the registration process by the master fund
	because its shares are not publicly registered. In the case of the Fund’s investment in
	shares of the Underlying Funds, there is no such concern because the shares of the
	Underlying Funds are publicly offered and registered under the Securities Act and the
	1940 Act. In addition, the reason for the feeder fund to disclose all of the relevant
	information about the master fund is that the feeder is merely a conduit to investment in
	the master, and the information about the master is not otherwise publicly available.
	Again, in the case of the Fund, its operations and characteristics are distinct from the
	operations and the characteristics of the individual Underlying Funds, and the Fund is not
	merely a conduit for investment in the Underlying Funds. Accordingly, the Fund’s
	disclosure should describe its own operations and characteristics, and it is not necessary
	or appropriate for the disclosure to describe all of the relevant information about the
	Underlying Funds. Extensive disclosure about the Underlying Funds would be
	potentially confusing to investors when included in the Fund’s disclosure, and such
	information is already publicly available through the public registration of the Underlying
	Funds.
Comment 2:	Principal Investment Strategies – Names of Underlying Funds
Comment:	Please confirm that the names provided for the Underlying Funds on page 3 of the
	prospectus are accurate.
Response:	We hereby confirm that the names provided for the Underlying Funds are accurate.
Comment 3:	1940 Act Rule 35d-1 – “Names Rule”
Comment:	The Staff notes that the Fund’s name is “Vanguard Total World Bond ETF”. Please
	expressly describe how the Fund will invest its assets in investments that are tied
	economically to a number of countries throughout the world. See Footnote 42 to the
	adopting release for Rule 35d-1 under the 1940 Act (the “Adopting Release”).
Response:	The Adopting Release states that, although “global” and “international” funds, which are
	similar to “world” funds, are not subject to Rule 35d-1 under the 1940 Act, the terms
	“global” and “international” connote diversification among investments in a number of
	different countries throughout the world. Footnote 42 of the Adopting Release explains
	that the SEC expects that funds using these terms in their names will invest their assets in
	investments that are tied economically to a number of countries throughout the world.
	The SEC Staff, in 2012, clarified that one way to satisfy this requirement would be for a
	fund to invest, under normal market conditions, in at least three different countries, and
	invest at least 40 percent of its assets outside the United States or, if conditions are not

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September 4, 2018

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	favorable, invest at least 30 percent of its assets outside the United States. We believe
	that the Fund’s investment strategy conforms to the guidance found in the above footnote
	and other Staff guidance. As disclosed in the Fund’s “Principal Investment Strategies,”
	the Fund’s “indirect bond holdings are a diversified mix of investment-grade U.S. and
	investment-grade non-U.S. government, corporate, and securitized bonds across yield
	curves and credit risks of multiple countries” (emphasis added). In addition, one of the
	Fund’s two Underlying Funds is the Vanguard Total International Bond Index Fund, the
	index for which “includes government, government agency, corporate, and securitized
	non-U.S. investment-grade fixed income investments…” (emphasis added). Through the
	Fund’s investment in Vanguard Total International Bond Index Fund, approximately 55%
	of the Fund’s assets will be indirectly invested in non-U.S. securities in at least three
	different countries. As of July 31, 2018, Vanguard Total International Bond Index Fund
	was invested in securities in 39 different countries.
Comment 4:	Risks – Fund of Funds Risk
Comment:	Please confirm that “Fund of Funds Risk” is disclosed as a risk of the Fund.
Response:	Although the Fund does not include a risk titled “Fund of Funds Risk,” the Principal
	Investment Strategies section of the prospectus clearly indicates that the Fund intends to
	invest “all, or substantially all, of its assets in two Vanguard bond index ETFs…”
	Immediately following, the Principal Risks section of the prospectus indicates the indirect
	risks of investing in the Underlying Funds (i.e., Interest Rate Risk, Credit Risk,
	Prepayment Risk, Call Risk, Extension Risk). In addition, the Principal Risks section
	discloses a number of risks related to the Fund’s ability to purchase shares of the
	underlying ETFs on a national securities exchange.
	We believe that this disclosure, coupled with the “Plain Talk About Funds of Funds” on
page 16, is sufficient to address the risks inherent in the Fund’s structure.
Comment 5:	More on the Fund and ETF Shares – Security Selection – Underlying Funds’ Indices
Comment:	With regards to each Underlying Fund’s respective underlying index, on page 16 please
	add disclosure related to: (a) the weighting of the index used, (b) an explanation of how
	and when the index changes, and (c) the number of index components.
Response:	We have added disclosure to the statutory prospectus intended to give further detail with
	respect to each Underlying Fund’s target index.
Comment 6:	More on the Fund and ETF Shares – Other Investment Policies and Risks –
	Derivatives

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September 4, 2018

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Comment:	The disclosure on page 20 of the prospectus indicates that the Fund may use total return
	swaps, which are senior securities for purposes of Section 18 of the 1940 Act. When the
	Fund uses total return swaps, it will be required to set aside an appropriate amount of
	liquid assets as determined by Staff guidance to address Section 18 concerns. Please note
	that the Commission has issued a release proposing a rule regarding a fund’s use of
	derivatives and Section 18. Please be aware that the Commission could issue a new rule
	or guidance regarding a fund’s use of derivatives that could impact the way that the Fund
	operates.
Response:	We hereby acknowledge the comment.
Comment 7:	Investment Advisor
Comment:	Please add language stating that a discussion regarding the basis for the board’s approval
	of the investment advisory contract is available in the Fund’s shareholder report per Item
	10(a)(1)(iii) of Form N-1A.
Response:	We have made this requested change.
Comment 8:	Financial Statements
Comment:	Please explain supplementally whether the Fund intends to present the financial
	statements of the Underlying Funds. See FASB ASC paragraph 946-210-45-7 and Letter
	from Lawrence A. Friend, Chief Accountant, SEC Division of Investment Management,
	to Mutual Fund Chief Financial Officers (Nov. 7, 1997).
Response:	The Fund does not intend to present the financial statements of the Underlying Funds in a
	manner similar to the presentation of financial statements of a master-feeder arrangement.
	However, the Fund’s financial statements will include additional information about the
	Underlying Funds.
	As noted above, in a master-feeder arrangement, the securities issued by the master fund
	are the only investment securities held by the feeder fund, and the feeder fund serves as a
	conduit for investment in the master fund. By contrast, the Fund will invest in more than
	one Underlying Fund. Consistent with SEC staff guidance, the Fund has considered
	whether its investment in either Underlying Fund is so significant to the Fund that its
	presentation of financial statements should be made in a manner similar to a master-
	feeder arrangement. While it is possible that the exact allocation of assets to each
	Underlying Fund may change from time to time, the Fund does not expect that the
	investment in any one Underlying Fund will reach a significant enough level to warrant
	the inclusion of the financial statements of the Underlying Funds. In addition, the
	Underlying Funds are themselves registered under the Securities Act and have publicly
	available financial statements. The Fund’s registration statement currently contains
	information regarding the Underlying Funds, including the Underlying Funds’ names and
	corresponding indexes, thus enabling shareholders of the Fund to find information about
	the Underlying Funds to the extent that they are interested in that information. Given the
	availability of publicly available information about the Underlying Funds in various
	places, we believe that a shareholder of the Fund has sufficient transparency into the
	activities of the Underlying Funds.

Lisa N. Larkin, Esq.

September 4, 2018

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Please contact me at (610) 669-1605 with any questions or comments regarding the above response.

Thank you.

Sincerely,

Brian P. Murphy

Senior Counsel

The Vanguard Group, Inc.