Vanguard Windsor II Fund |
Summary Prospectus |
February 26, 2014 |
Investor Shares & Admiral Shares |
Vanguard Windsor II Fund Investor Shares (VWNFX) |
Vanguard Windsor II Fund Admiral Shares (VWNAX) |
The Funds statutory Prospectus and Statement of Additional Information dated |
February 26, 2014, as may be amended or supplemented, are incorporated into |
and made part of this Summary Prospectus by reference. |
Before you invest, you may want to review the Funds Prospectus, which |
contains more information about the Fund and its risks. You can find |
the Funds Prospectus and other information about the Fund online at |
www.vanguard.com/prospectus. You can also obtain this information at no |
cost by calling 800-662-7447 or by sending an e-mail request to |
online@vanguard.com. |
The Securities and Exchange Commission (SEC) has not approved or disapproved these securities or |
passed upon the adequacy of this prospectus. Any representation to the contrary is a criminal offense. |
Investment Objective
The Fund seeks to provide long-term capital appreciation and income.
Fees and Expenses
The following table describes the fees and expenses you may pay if you buy and hold Investor Shares or Admiral Shares of the Fund.
Shareholder Fees | ||
(Fees paid directly from your investment) | ||
Investor Shares | Admiral Shares | |
Sales Charge (Load) Imposed on Purchases | None | None |
Purchase Fee | None | None |
Sales Charge (Load) Imposed on Reinvested Dividends | None | None |
Redemption Fee | None | None |
Account Service Fee (for certain fund account balances below | $20/year | $20/year |
$10,000) | ||
Annual Fund Operating Expenses | ||
(Expenses that you pay each year as a percentage of the value of your investment) | ||
Investor Shares | Admiral Shares | |
Management Fees | 0.34% | 0.26% |
12b-1 Distribution Fee | None | None |
Other Expenses | 0.02% | 0.02% |
Total Annual Fund Operating Expenses | 0.36% | 0.28% |
Examples
The following examples are intended to help you compare the cost of investing in the Funds Investor Shares or Admiral Shares with the cost of investing in other mutual funds. They illustrate the hypothetical expenses that you would incur over various periods if you invest $10,000 in the Funds shares. These examples assume that the Shares provide a return of 5% a year and that total annual fund operating expenses remain as stated in the preceding table. The results apply whether or not you redeem your investment at the end of the given period. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
1 Year | 3 Years | 5 Years | 10 Years | |
Investor Shares | $37 | $116 | $202 | $456 |
Admiral Shares | $29 | $90 | $157 | $356 |
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Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in more taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the previous expense examples, reduce the Funds performance. During the most recent fiscal year, the Funds portfolio turnover rate was 27%.
Primary Investment Strategies
The Fund invests mainly in large- and mid-capitalization companies whose stocks are considered by an advisor to be undervalued. Undervalued stocks are generally those that are out of favor with investors and that the advisor feels are trading at prices that are below average in relation to measures such as earnings and book value. These stocks often have above-average dividend yields. The Fund uses multiple investment advisors.
Primary Risks
An investment in the Fund could lose money over short or even long periods. You should expect the Funds share price and total return to fluctuate within a wide range, like the fluctuations of the overall stock market. The Fund is subject to the following risks, which could affect the Funds performance:
Stock market risk, which is the chance that stock prices overall will decline. Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices.
Investment style risk, which is the chance that returns from large- and mid-capitalization value stocks will trail returns from the overall stock market. Large- and mid-cap stocks each tend to go through cycles of doing betteror worsethan other segments of the stock market or the stock market in general. These periods have, in the past, lasted for as long as several years. Historically, mid-cap stocks have been more volatile in price than large-cap stocks.
Asset concentration risk, which is the chance that the Funds performance may be hurt disproportionately by the poor performance of relatively few stocks. The Fund tends to invest a high percentage of assets in its ten largest holdings.
Manager risk, which is the chance that poor security selection will cause the Fund to underperform relevant benchmarks or other funds with a similar investment objective. In addition, significant investment in the financial sector subjects the Fund to proportionately higher exposure to the risks of this sector.
An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.
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Annual Total Returns
The following bar chart and table are intended to help you understand the risks of investing in the Fund. The bar chart shows how the performance of the Funds Investor Shareshas varied from one calendar year to another over the periods shown. The table shows how the average annual total returns of the share classes presented compare with those of relevant market indexes, which have investment characteristics similar to those of the Fund. Keep in mind that the Funds past performance (before and after taxes) does not indicate how the Fund will perform in the future. Updated performance information is available on our website at vanguard.com/performance or by calling Vanguard toll-free at 800-662-7447.
Annual Total Returns Vanguard Windsor II Fund Investor Shares
During the periods shown in the bar chart, the highest return for a calendar quarter was 17.78% (quarter ended June 30, 2009), and the lowest return for a quarter was 21.62% (quarter ended December 31, 2008).
Average Annual Total Returns for Periods Ended December 31, 2013 | |||
1 Year | 5 Years | 10 Years | |
Vanguard Windsor II Fund Investor Shares | |||
Return Before Taxes | 30.69% | 17.10% | 7.87% |
Return After Taxes on Distributions | 29.36 | 16.54 | 7.11 |
Return After Taxes on Distributions and Sale of Fund Shares | 18.35 | 13.89 | 6.45 |
Vanguard Windsor II Fund Admiral Shares | |||
Return Before Taxes | 30.80% | 17.19% | 7.97% |
Comparative Indexes | |||
(reflect no deduction for fees, expenses, or taxes) | |||
Russell 1000 Value Index | 32.53% | 16.67% | 7.58% |
Standard & Poor's 500 Index | 32.39 | 17.94 | 7.41 |
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Actual after-tax returns depend on your tax situation and may differ from those shown in the preceding table. When after-tax returns are calculated, it is assumed that the shareholder was in the highest individual federal marginal income tax bracket at the time of each distribution of income or capital gains or upon redemption. State and local income taxes are not reflected in the calculations. Please note that after-tax returns are shown only for the Investor Shares and may differ for each share class. After-tax returns are not relevant for a shareholder who holds fund shares in a tax-deferred account, such as an individual retirement account or a 401(k) plan. Also, figures captioned Return After Taxes on Distributions and Sale of Fund Shares may be higher than other figures for the same period if a capital loss occurs upon redemption and results in an assumed tax deduction for the shareholder.
Investment Advisors
Armstrong Shaw Associates Inc. (Armstrong Shaw) Barrow, Hanley, Mewhinney & Strauss, LLC (Barrow, Hanley) Hotchkis and Wiley Capital Management, LLC (Hotchkis and Wiley) Lazard Asset Management LLC (Lazard) Sanders Capital, LLC (Sanders) The Vanguard Group, Inc. (Vanguard)
Portfolio Managers
Jeffrey M. Shaw, Chairman, Chief Investment Officer, and Co-Founder of Armstrong Shaw. He has managed a portion of the Fund since 2006.
James P. Barrow, Founding Partner and Executive Director of Barrow, Hanley. He has managed a portion of the Fund since 1985.
Jeff G. Fahrenbruch, CFA, Managing Director of Barrow, Hanley. He has served as an associate portfolio manager for a portion of the Fund since 2013.
David W. Ganucheau, CFA, Managing Director of Barrow, Hanley. He has served as an associate portfolio manager for a portion of the Fund since 2013.
George H. Davis, Jr., Chief Executive Officer of Hotchkis and Wiley. He has co-managed a portion of the Fund since 2003.
Sheldon J. Lieberman, Principal of Hotchkis and Wiley. He has co-managed a portion of the Fund since 2003.
Christopher Blake, Managing Director of Lazard. He has co-managed a portion of the Fund since 2007.
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Andrew Lacey, Deputy Chairman of Lazard. He has co-managed a portion of the Fund since 2007.
John P. Mahedy, CPA, Director of Research and Co-Chief Investment Officer of Sanders. He has co-managed a portion of the Fund since 2010.
Lewis A. Sanders, CFA, Chief Executive Officer and Co-Chief Investment Officer of Sanders. He has co-managed a portion of the Fund since 2010.
James D. Troyer, CFA, Principal of Vanguard. He has managed a portion of the Fund since 2006 (co-managed since 2012).
James P. Stetler, Principal of Vanguard. He has co-managed a portion of the Fund since 2012.
Michael R. Roach, CFA, Portfolio Manager at Vanguard. He has co-managed a portion of the Fund since 2012.
Purchase and Sale of Fund Shares
You may purchase or redeem shares online through our website (vanguard.com), by mail (The Vanguard Group, P.O. Box 1110, Valley Forge, PA 19482-1110), or by telephone (800-662-2739). The following table provides the Funds minimum initial and subsequent investment requirements.
Account Minimums | Investor Shares | Admiral Shares* |
To open and maintain an account | $3,000 | $50,000 |
To add to an existing account | Generally $100 (other than | Generally $100 (other than |
by Automatic Investment | by Automatic Investment | |
Plan, which has no | Plan, which has no | |
established minimum) | established minimum) |
*Institutional and financial intermediary clients should contact Vanguard for information on special eligibility rules that may apply to them.
Tax Information
The Funds distributions may be taxable as ordinary income or capital gain. If you are investing through a tax-deferred retirement account, such as an IRA, special tax rules apply.
Payments to Financial Intermediaries
The Fund and its investment advisors do not pay financial intermediaries for sales of Fund shares.
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Vanguard Windsor II Fund Investor SharesFund Number 73 Vanguard Windsor II Fund Admiral SharesFund Number 573
CFA® is a trademark owned by CFA Institute.
© 2014 The Vanguard Group, Inc. All rights reserved.
Vanguard Marketing Corporation, Distributor.
SP 73 022014
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