UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT COMPANY
Investment Company Act file number: 811-01685
Name of Registrant: Vanguard Morgan Growth Fund
Address of Registrant:
P.O. Box 2600
Valley Forge, PA 19482
Name and address of agent for service:
Heidi Stam, Esquire
P.O. Box 876
Valley Forge, PA 19482
Date of fiscal year end: September 30th
Date of reporting period: December 31, 2015
Item 1: Schedule of Investments
| Vanguard Morgan Growth Fund | |||
| Schedule of Investments | |||
| As of December 31, 2015 | |||
| Market | |||
| Value | |||
| Shares | ($000) | ||
| Common Stocks (96.7%)1 | |||
| Consumer Discretionary (21.2%) | |||
| * | Amazon.com Inc. | 549,251 | 371,233 |
| Home Depot Inc. | 1,283,668 | 169,765 | |
| Comcast Corp. Class A | 2,368,631 | 133,662 | |
| * | Priceline Group Inc. | 88,654 | 113,029 |
| * | O'Reilly Automotive Inc. | 413,648 | 104,827 |
| NIKE Inc. Class B | 1,618,334 | 101,146 | |
| Lowe's Cos. Inc. | 1,322,804 | 100,586 | |
| * | Netflix Inc. | 752,969 | 86,125 |
| McDonald's Corp. | 711,289 | 84,032 | |
| Starbucks Corp. | 1,337,888 | 80,313 | |
| Walt Disney Co. | 743,787 | 78,157 | |
| TJX Cos. Inc. | 927,263 | 65,752 | |
| Ross Stores Inc. | 1,218,016 | 65,541 | |
| Expedia Inc. | 440,856 | 54,798 | |
| Marriott International Inc. Class A | 788,063 | 52,832 | |
| Advance Auto Parts Inc. | 342,965 | 51,620 | |
| Industria de Diseno Textil SA ADR | 2,935,822 | 50,643 | |
| * | Under Armour Inc. Class A | 558,974 | 45,059 |
| *,^ Tesla Motors Inc. | 160,646 | 38,557 | |
| * | LKQ Corp. | 1,220,828 | 36,173 |
| Wyndham Worldwide Corp. | 463,327 | 33,661 | |
| Dunkin' Brands Group Inc. | 607,506 | 25,874 | |
| CBS Corp. Class B | 521,345 | 24,571 | |
| PulteGroup Inc. | 1,242,671 | 22,144 | |
| Carter's Inc. | 236,485 | 21,054 | |
| * | Dollar Tree Inc. | 255,563 | 19,735 |
| * | Michaels Cos. Inc. | 863,845 | 19,100 |
| Hilton Worldwide Holdings Inc. | 864,830 | 18,507 | |
| Las Vegas Sands Corp. | 410,593 | 18,000 | |
| * | Ulta Salon Cosmetics & Fragrance Inc. | 92,190 | 17,055 |
| Scripps Networks Interactive Inc. Class A | 297,997 | 16,452 | |
| Tractor Supply Co. | 191,440 | 16,368 | |
| * | CarMax Inc. | 300,860 | 16,237 |
| Brunswick Corp. | 321,356 | 16,232 | |
| Harman International Industries Inc. | 169,163 | 15,937 | |
| Dollar General Corp. | 208,809 | 15,007 | |
| * | Discovery Communications Inc. Class A | 514,631 | 13,730 |
| * | JD.com Inc. ADR | 402,297 | 12,980 |
| Hanesbrands Inc. | 412,260 | 12,133 | |
| Wolverine World Wide Inc. | 717,635 | 11,992 | |
| Royal Caribbean Cruises Ltd. | 117,013 | 11,843 | |
| * | Urban Outfitters Inc. | 519,085 | 11,809 |
| BorgWarner Inc. | 270,060 | 11,675 | |
| * | Jarden Corp. | 203,057 | 11,599 |
| Aramark | 351,418 | 11,333 | |
| Service Corp. International | 424,275 | 11,040 | |
| Starwood Hotels & Resorts Worldwide Inc. | 158,090 | 10,952 | |
| *,^ Shake Shack Inc. Class A | 274,188 | 10,858 | |
| L Brands Inc. | 106,833 | 10,237 | |
| GNC Holdings Inc. Class A | 324,525 | 10,067 |
| Carnival Corp. | 184,400 | 10,046 |
| Ralph Lauren Corp. Class A | 87,292 | 9,731 |
| * Sirius XM Holdings Inc. | 2,276,900 | 9,267 |
| * NVR Inc. | 5,540 | 9,102 |
| * MGM Resorts International | 396,751 | 9,014 |
| * DISH Network Corp. Class A | 155,500 | 8,891 |
| Foot Locker Inc. | 131,200 | 8,540 |
| * Bright Horizons Family Solutions Inc. | 123,795 | 8,270 |
| * IMAX Corp. | 223,213 | 7,933 |
| * lululemon athletica Inc. | 136,002 | 7,136 |
| Goodyear Tire & Rubber Co. | 194,100 | 6,341 |
| * Norwegian Cruise Line Holdings Ltd. | 68,400 | 4,008 |
| Delphi Automotive plc | 41,300 | 3,541 |
| DR Horton Inc. | 110,000 | 3,523 |
| Omnicom Group Inc. | 43,600 | 3,299 |
| * AMC Networks Inc. Class A | 36,500 | 2,726 |
| * Liberty Interactive Corp. QVC Group Class A | 77,300 | 2,112 |
| PVH Corp. | 19,800 | 1,458 |
| * Discovery Communications Inc. | 50,900 | 1,284 |
| Time Warner Inc. | 13,600 | 880 |
| 2,479,134 | ||
| Consumer Staples (6.5%) | ||
| Costco Wholesale Corp. | 941,658 | 152,078 |
| PepsiCo Inc. | 1,446,229 | 144,507 |
| CVS Health Corp. | 1,018,686 | 99,597 |
| Mondelez International Inc. Class A | 1,649,782 | 73,976 |
| * Monster Beverage Corp. | 434,553 | 64,731 |
| Estee Lauder Cos. Inc. Class A | 694,613 | 61,167 |
| Colgate-Palmolive Co. | 586,052 | 39,043 |
| Altria Group Inc. | 357,500 | 20,810 |
| Anheuser-Busch InBev NV ADR | 121,245 | 15,156 |
| Kroger Co. | 347,000 | 14,515 |
| Brown-Forman Corp. Class B | 135,343 | 13,437 |
| * Performance Food Group Co. | 502,940 | 11,638 |
| * TreeHouse Foods Inc. | 118,035 | 9,261 |
| ^ Pilgrim's Pride Corp. | 396,100 | 8,750 |
| Coty Inc. Class A | 270,400 | 6,930 |
| Clorox Co. | 47,700 | 6,050 |
| Mead Johnson Nutrition Co. | 71,881 | 5,675 |
| Hormel Foods Corp. | 51,300 | 4,057 |
| Walgreens Boots Alliance Inc. | 40,800 | 3,474 |
| Hershey Co. | 22,000 | 1,964 |
| 756,816 | ||
| Energy (1.1%) | ||
| BP plc ADR | 791,084 | 24,729 |
| Chevron Corp. | 249,276 | 22,425 |
| Core Laboratories NV | 136,475 | 14,840 |
| * Cameron International Corp. | 165,020 | 10,429 |
| * Carrizo Oil & Gas Inc. | 274,777 | 8,128 |
| Valero Energy Corp. | 114,000 | 8,061 |
| Tesoro Corp. | 75,700 | 7,977 |
| * Weatherford International plc | 883,980 | 7,417 |
| Cabot Oil & Gas Corp. | 414,300 | 7,329 |
| * Gulfport Energy Corp. | 256,615 | 6,305 |
| Plains GP Holdings LP Class A | 448,800 | 4,241 |
| Superior Energy Services Inc. | 240,685 | 3,242 | |
| *,^ InterOil Corp. | 82,081 | 2,579 | |
| * | Southwestern Energy Co. | 300,070 | 2,133 |
| * | FMC Technologies Inc. | 18,500 | 537 |
| 130,372 | |||
| Financials (5.7%) | |||
| Public Storage | 270,567 | 67,019 | |
| Intercontinental Exchange Inc. | 217,184 | 55,656 | |
| Bank of America Corp. | 2,901,951 | 48,840 | |
| American International Group Inc. | 723,873 | 44,858 | |
| Goldman Sachs Group Inc. | 247,266 | 44,565 | |
| JPMorgan Chase & Co. | 656,636 | 43,358 | |
| Morgan Stanley | 1,045,041 | 33,243 | |
| FactSet Research Systems Inc. | 178,418 | 29,005 | |
| Moody's Corp. | 245,430 | 24,626 | |
| American Tower Corporation | 224,855 | 21,800 | |
| Aon plc | 221,724 | 20,445 | |
| * | Signature Bank | 132,098 | 20,260 |
| Raymond James Financial Inc. | 346,033 | 20,060 | |
| * | E*TRADE Financial Corp. | 664,709 | 19,702 |
| * | Berkshire Hathaway Inc. Class B | 117,400 | 15,501 |
| * | Affiliated Managers Group Inc. | 83,265 | 13,302 |
| T. Rowe Price Group Inc. | 177,455 | 12,686 | |
| Nasdaq Inc. | 208,858 | 12,149 | |
| Citigroup Inc. | 231,900 | 12,001 | |
| Simon Property Group Inc. | 56,100 | 10,908 | |
| Equinix Inc. | 34,886 | 10,549 | |
| Ameriprise Financial Inc. | 88,400 | 9,408 | |
| Citizens Financial Group Inc. | 306,862 | 8,037 | |
| MSCI Inc. Class A | 108,800 | 7,848 | |
| AvalonBay Communities Inc. | 41,900 | 7,715 | |
| Marsh & McLennan Cos. Inc. | 134,400 | 7,452 | |
| Voya Financial Inc. | 199,200 | 7,352 | |
| Legg Mason Inc. | 171,200 | 6,716 | |
| WisdomTree Investments Inc. | 403,491 | 6,327 | |
| American Express Co. | 71,050 | 4,942 | |
| * | Ally Financial Inc. | 250,300 | 4,666 |
| Jones Lang LaSalle Inc. | 27,700 | 4,428 | |
| * | Realogy Holdings Corp. | 90,400 | 3,315 |
| Extra Space Storage Inc. | 30,200 | 2,664 | |
| Communications Sales & Leasing Inc. | 125,100 | 2,338 | |
| FNF Group | 30,800 | 1,068 | |
| Crown Castle International Corp. | 8,800 | 761 | |
| 665,570 | |||
| Health Care (17.6%) | |||
| Bristol-Myers Squibb Co. | 2,681,536 | 184,463 | |
| Gilead Sciences Inc. | 1,331,125 | 134,697 | |
| Amgen Inc. | 789,780 | 128,205 | |
| * | Celgene Corp. | 1,023,326 | 122,554 |
| * | Allergan plc | 338,856 | 105,892 |
| Eli Lilly & Co. | 896,784 | 75,563 | |
| * | Alexion Pharmaceuticals Inc. | 394,491 | 75,249 |
| * | Vertex Pharmaceuticals Inc. | 584,843 | 73,591 |
| * | BioMarin Pharmaceutical Inc. | 673,107 | 70,515 |
| Cardinal Health Inc. | 777,488 | 69,406 | |
| CR Bard Inc. | 309,323 | 58,598 | |
| Aetna Inc. | 461,647 | 49,913 |
| Becton Dickinson and Co. | 307,015 | 47,308 |
| Johnson & Johnson | 427,454 | 43,908 |
| Shire plc ADR | 212,728 | 43,609 |
| Medtronic plc | 553,877 | 42,604 |
| * Illumina Inc. | 211,765 | 40,647 |
| Merck & Co. Inc. | 766,181 | 40,470 |
| * Biogen Inc. | 121,923 | 37,351 |
| Novo Nordisk A/S ADR | 510,349 | 29,641 |
| AstraZeneca plc ADR | 848,867 | 28,819 |
| Cooper Cos. Inc. | 201,063 | 26,983 |
| Perrigo Co. plc | 183,714 | 26,583 |
| * Medivation Inc. | 484,821 | 23,436 |
| Zoetis Inc. | 471,150 | 22,577 |
| Thermo Fisher Scientific Inc. | 155,690 | 22,085 |
| * Cerner Corp. | 351,991 | 21,179 |
| Anthem Inc. | 149,836 | 20,893 |
| AbbVie Inc. | 343,100 | 20,325 |
| * Regeneron Pharmaceuticals Inc. | 36,181 | 19,642 |
| Zimmer Biomet Holdings Inc. | 190,095 | 19,502 |
| * PAREXEL International Corp. | 271,397 | 18,488 |
| * Hologic Inc. | 469,975 | 18,183 |
| UnitedHealth Group Inc. | 147,900 | 17,399 |
| * Sirona Dental Systems Inc. | 158,320 | 17,347 |
| ResMed Inc. | 318,895 | 17,121 |
| * Varian Medical Systems Inc. | 198,819 | 16,065 |
| * MEDNAX Inc. | 215,334 | 15,431 |
| * Express Scripts Holding Co. | 170,155 | 14,873 |
| * Akorn Inc. | 398,040 | 14,851 |
| * Align Technology Inc. | 224,235 | 14,766 |
| Baxalta Inc. | 296,600 | 11,576 |
| AmerisourceBergen Corp. Class A | 107,800 | 11,180 |
| Universal Health Services Inc. Class B | 91,593 | 10,944 |
| * STERIS plc | 140,770 | 10,606 |
| Humana Inc. | 58,826 | 10,501 |
| * Jazz Pharmaceuticals plc | 72,885 | 10,245 |
| * HCA Holdings Inc. | 143,600 | 9,712 |
| * Mettler-Toledo International Inc. | 28,200 | 9,563 |
| * Centene Corp. | 144,200 | 9,490 |
| * Alkermes plc | 115,995 | 9,208 |
| * United Therapeutics Corp. | 57,000 | 8,927 |
| * Quintiles Transnational Holdings Inc. | 125,500 | 8,617 |
| * Incyte Corp. | 77,699 | 8,426 |
| McKesson Corp. | 38,200 | 7,534 |
| Abbott Laboratories | 151,100 | 6,786 |
| * DexCom Inc. | 67,787 | 5,552 |
| Cigna Corp. | 36,600 | 5,356 |
| HealthSouth Corp. | 130,208 | 4,533 |
| * Charles River Laboratories International Inc. | 42,000 | 3,376 |
| DENTSPLY International Inc. | 10,100 | 615 |
| 2,053,479 | ||
| Industrials (8.1%) | ||
| Boeing Co. | 966,355 | 139,725 |
| * IHS Inc. Class A | 537,013 | 63,598 |
| Honeywell International Inc. | 548,794 | 56,839 |
| Danaher Corp. | 559,829 | 51,997 |
| * TransDigm Group Inc. | 220,694 | 50,418 |
| * Verisk Analytics Inc. Class A | 613,145 | 47,139 |
| Equifax Inc. | 391,951 | 43,652 |
| Nielsen Holdings plc | 636,287 | 29,651 |
| JB Hunt Transport Services Inc. | 359,497 | 26,373 |
| Cintas Corp. | 288,879 | 26,302 |
| American Airlines Group Inc. | 560,475 | 23,736 |
| * United Continental Holdings Inc. | 373,458 | 21,399 |
| Acuity Brands Inc. | 87,695 | 20,503 |
| Rockwell Automation Inc. | 195,985 | 20,110 |
| * HD Supply Holdings Inc. | 620,724 | 18,640 |
| AMETEK Inc. | 340,383 | 18,241 |
| Watsco Inc. | 148,390 | 17,381 |
| * Stericycle Inc. | 137,605 | 16,595 |
| Carlisle Cos. Inc. | 181,405 | 16,089 |
| Roper Technologies Inc. | 78,976 | 14,989 |
| Fastenal Co. | 362,025 | 14,778 |
| Pentair plc | 296,920 | 14,706 |
| * Copart Inc. | 357,436 | 13,586 |
| Southwest Airlines Co. | 281,600 | 12,126 |
| Delta Air Lines Inc. | 235,100 | 11,917 |
| * Hertz Global Holdings Inc. | 784,890 | 11,169 |
| Wabtec Corp. | 153,468 | 10,915 |
| Waste Connections Inc. | 192,249 | 10,828 |
| MSC Industrial Direct Co. Inc. Class A | 163,680 | 9,210 |
| KAR Auction Services Inc. | 246,643 | 9,133 |
| Huntington Ingalls Industries Inc. | 70,300 | 8,918 |
| Alaska Air Group Inc. | 108,700 | 8,751 |
| Lockheed Martin Corp. | 39,900 | 8,664 |
| * United Rentals Inc. | 114,595 | 8,313 |
| * Spirit AeroSystems Holdings Inc. Class A | 165,400 | 8,282 |
| Masco Corp. | 288,000 | 8,150 |
| PACCAR Inc. | 153,800 | 7,290 |
| * Kirby Corp. | 137,626 | 7,242 |
| Flowserve Corp. | 162,795 | 6,850 |
| Trinity Industries Inc. | 280,600 | 6,740 |
| * Quanta Services Inc. | 252,975 | 5,123 |
| Owens Corning | 105,400 | 4,957 |
| CEB Inc. | 63,521 | 3,900 |
| United Parcel Service Inc. Class B | 31,800 | 3,060 |
| Robert Half International Inc. | 60,800 | 2,866 |
| Union Pacific Corp. | 33,800 | 2,643 |
| 3M Co. | 13,000 | 1,958 |
| Textron Inc. | 34,500 | 1,449 |
| Allison Transmission Holdings Inc. | 43,000 | 1,113 |
| * JetBlue Airways Corp. | 42,600 | 965 |
| 948,979 | ||
| Information Technology (33.0%) | ||
| Apple Inc. | 4,775,647 | 502,685 |
| * Alphabet Inc. | 533,205 | 404,639 |
| * Facebook Inc. Class A | 2,848,208 | 298,093 |
| Microsoft Corp. | 4,241,523 | 235,320 |
| Visa Inc. Class A | 2,716,229 | 210,644 |
| Oracle Corp. | 4,452,319 | 162,643 |
| * salesforce.com inc | 1,765,021 | 138,378 |
| * Alphabet Inc. Class A | 140,849 | 109,582 |
| * Alliance Data Systems Corp. | 353,442 | 97,751 |
| MasterCard Inc. Class A | 907,371 | 88,342 |
| * | Check Point Software Technologies Ltd. | 905,199 | 73,665 |
| * | Alibaba Group Holding Ltd. ADR | 849,932 | 69,074 |
| * | Vantiv Inc. Class A | 1,406,719 | 66,707 |
| * | Red Hat Inc. | 800,307 | 66,273 |
| Paychex Inc. | 1,039,240 | 54,965 | |
| Activision Blizzard Inc. | 1,399,847 | 54,188 | |
| * | Fiserv Inc. | 581,979 | 53,228 |
| * | LinkedIn Corp. Class A | 233,232 | 52,496 |
| Cisco Systems Inc. | 1,922,435 | 52,204 | |
| * | First Solar Inc. | 785,566 | 51,839 |
| * | Adobe Systems Inc. | 536,297 | 50,380 |
| * | Workday Inc. Class A | 594,167 | 47,343 |
| Maxim Integrated Products Inc. | 1,190,555 | 45,241 | |
| * | PayPal Holdings Inc. | 1,242,184 | 44,967 |
| Tencent Holdings Ltd. | 2,276,151 | 44,567 | |
| * | Electronic Arts Inc. | 606,662 | 41,690 |
| Jack Henry & Associates Inc. | 513,484 | 40,083 | |
| * | F5 Networks Inc. | 397,378 | 38,530 |
| * | eBay Inc. | 1,347,203 | 37,021 |
| * | Cognizant Technology Solutions Corp. Class A | 606,325 | 36,392 |
| Linear Technology Corp. | 825,295 | 35,050 | |
| Intuit Inc. | 335,237 | 32,350 | |
| Global Payments Inc. | 494,237 | 31,883 | |
| Amphenol Corp. Class A | 551,813 | 28,821 | |
| CDW Corp. | 619,079 | 26,026 | |
| Amdocs Ltd. | 475,163 | 25,930 | |
| * | NXP Semiconductors NV | 305,363 | 25,727 |
| * | Baidu Inc. ADR | 132,759 | 25,097 |
| * | Splunk Inc. | 416,722 | 24,507 |
| QUALCOMM Inc. | 458,626 | 22,924 | |
| * | Euronet Worldwide Inc. | 292,258 | 21,168 |
| Broadcom Corp. Class A | 337,198 | 19,497 | |
| CDK Global Inc. | 406,499 | 19,297 | |
| Accenture plc Class A | 169,000 | 17,660 | |
| * | Gartner Inc. | 194,532 | 17,644 |
| Analog Devices Inc. | 313,678 | 17,353 | |
| * | Cadence Design Systems Inc. | 746,143 | 15,527 |
| * | VeriFone Systems Inc. | 519,815 | 14,565 |
| Avago Technologies Ltd. Class A | 92,500 | 13,426 | |
| Lam Research Corp. | 148,861 | 11,823 | |
| Fair Isaac Corp. | 122,642 | 11,550 | |
| Fidelity National Information Services Inc. | 176,055 | 10,669 | |
| * | Qorvo Inc. | 202,412 | 10,303 |
| * | Citrix Systems Inc. | 128,800 | 9,744 |
| * | Palo Alto Networks Inc. | 54,056 | 9,521 |
| * | Rackspace Hosting Inc. | 353,300 | 8,946 |
| * | Zebra Technologies Corp. | 123,480 | 8,600 |
| Total System Services Inc. | 170,800 | 8,506 | |
| * | First Data Corp. Class A | 506,200 | 8,109 |
| *,^ VMware Inc. Class A | 138,700 | 7,846 | |
| * | Genpact Ltd. | 306,110 | 7,647 |
| Jabil Circuit Inc. | 327,400 | 7,625 | |
| * | Fortinet Inc. | 244,026 | 7,606 |
| FLIR Systems Inc. | 168,455 | 4,729 | |
| *,^ Fitbit Inc. Class A | 140,900 | 4,169 | |
| Atmel Corp. | 463,438 | 3,990 | |
| Broadridge Financial Solutions Inc. | 63,100 | 3,390 | |
| Skyworks Solutions Inc. | 42,400 | 3,258 | |||
| Motorola Solutions Inc. | 21,300 | 1,458 | |||
| Sabre Corp. | 36,100 | 1,010 | |||
| 3,853,881 | |||||
| Materials (1.4%) | |||||
| Sherwin-Williams Co. | 224,703 | 58,333 | |||
| * | WR Grace & Co. | 205,365 | 20,452 | ||
| Monsanto Co. | 199,651 | 19,670 | |||
| Ashland Inc. | 166,160 | 17,065 | |||
| PolyOne Corp. | 371,070 | 11,785 | |||
| * | Crown Holdings Inc. | 169,800 | 8,609 | ||
| Packaging Corp. of America | 114,400 | 7,213 | |||
| Sealed Air Corp. | 144,100 | 6,427 | |||
| CF Industries Holdings Inc. | 139,150 | 5,679 | |||
| International Flavors & Fragrances Inc. | 34,100 | 4,080 | |||
| NewMarket Corp. | 2,100 | 799 | |||
| Nucor Corp. | 17,900 | 721 | |||
| Air Products & Chemicals Inc. | 4,500 | 585 | |||
| * | Axalta Coating Systems Ltd. | 20,900 | 557 | ||
| 161,975 | |||||
| Other (1.0%) | |||||
| ^,2 Vanguard Growth ETF | 1,044,900 | 111,167 | |||
| Telecommunication Services (1.1%) | |||||
| Verizon Communications Inc. | 1,515,058 | 70,026 | |||
| * | SBA Communications Corp. Class A | 414,731 | 43,576 | ||
| Cogent Communications Holdings Inc. | 279,224 | 9,686 | |||
| * | T-Mobile US Inc. | 181,200 | 7,089 | ||
| 130,377 | |||||
| Utilities (0.0%) | |||||
| * | Calpine Corp. | 52,100 | 754 | ||
| Total Common Stocks (Cost $8,074,861) | 11,292,504 | ||||
| Coupon | |||||
| Temporary Cash Investments (4.4%)1 | |||||
| Money Market Fund (3.0%) | |||||
| 3,4 Vanguard Market Liquidity Fund | 0.363% | 355,389,322 | 355,389 | ||
| Face | |||||
| Maturity | Amount | ||||
| Date | ($000) | ||||
| Repurchase Agreement (1.2%) | |||||
| Bank of America Securities, LLC | |||||
| (Dated 12/31/15, Repurchase Value | |||||
| $136,105,000, collateralized by Federal | |||||
| National Mortgage Assn. 2.290%-2.745%, | |||||
| 1/1/41-12/1/42, and Federal Home Loan | |||||
| Mortgage Corp. 2.323%-3.500%, 2/1/29- | |||||
| 3/1/43, with value of $138,822,000) | 0.300% | 1/4/16 | 136,100 | 136,100 | |
| U.S. Government and Agency Obligations (0.2%) | |||||
| 5,6 Federal Home Loan Bank Discount Notes | 0.200% | 2/5/16 | 200 | 200 | |
| 5 | Federal Home Loan Bank Discount Notes | 0.225% | 2/12/16 | 1,000 | 1,000 |
| 5,6 Federal Home Loan Bank Discount Notes | 0.315% | 3/2/16 | 5,000 | 4,997 | |
| 5 | Federal Home Loan Bank Discount Notes | 0.245% | 4/20/16 | 5,000 | 4,993 |
| 5,6 Federal Home Loan Bank Discount Notes | 0.290%–0.294% | 4/29/16 | 2,000 | 1,997 | |
| 6,7 Freddie Mac Discount Notes | 0.220% | 4/15/16 | 6,000 | 5,993 | |
| 6 | United States Treasury Bill | 0.370%–0.386% | 5/26/16 | 700 | 699 |
| 6 | United States Treasury Note | 0.375% | 5/31/16 | 1,000 | 1,000 |
| United States Treasury Note | 3.250% | 5/31/16 | 1,000 | 1,011 | |
| 21,890 | |||||
| Total Temporary Cash Investments (Cost $513,387) | 513,379 | ||||
| Total Investments (101.1%) (Cost $8,588,248) | 11,805,883 | ||||
| Other Assets and Liabilities-Net (-1.1%)4 | (128,939) | ||||
| Net Assets (100%) | 11,676,944 | ||||
* Non-income-producing security.
^ Includes partial security positions on loan to broker-dealers. The total value of securities on loan is $28,418,000.
1 The fund invests a portion of its cash reserves in equity markets through the use of index futures contracts. After giving effect to futures investments, the fund's effective common stock and temporary cash investment positions represent 98.6% and 2.5%, respectively, of net assets.
2 Considered an affiliated company of the fund as the issuer is another member of The Vanguard Group.
3 Affiliated money market fund available only to Vanguard funds and certain trusts and accounts managed by Vanguard. Rate shown is the 7-day yield.
4 Includes $29,128,000 of collateral received for securities on loan.
5 The issuer operates under a congressional charter; its securities are generally neither guaranteed by the U.S. Treasury nor backed by the full faith and credit of the U.S. government.
6 Securities with a value of $11,587,000 have been segregated as initial margin for open futures contracts.
7 The issuer was placed under federal conservatorship in September 2008; since that time, its daily operations have been managed by the Federal Housing Finance Agency and it receives capital from the U.S. Treasury, as needed to maintain a positive net worth, in exchange for senior preferred stock.
ADR—American Depositary Receipt.
A. Security Valuation: Securities are valued as of the close of trading on the New York Stock Exchange (generally 4 p.m., Eastern time) on the valuation date. Equity securities are valued at the latest quoted sales prices or official closing prices taken from the primary market in which each security trades; such securities not traded on the valuation date are valued at the mean of the latest quoted bid and asked prices. Securities for which market quotations are not readily available, or whose values have been affected by events occurring before the fund's pricing time but after the close of the securities’ primary markets, are valued at their fair values calculated according to procedures adopted by the board of trustees. These procedures include obtaining quotations from an independent pricing service, monitoring news to identify significant market- or security-specific events, and evaluating changes in the values of foreign market proxies (for example, ADRs, futures contracts, or exchange-traded funds), between the time the foreign markets close and the fund's pricing time. When fair-value pricing is employed, the prices of securities used by a fund to calculate its net asset value may differ from quoted or published prices for the same securities. Investments in Vanguard Market Liquidity Fund are valued at that fund’s net asset value. Temporary cash investments acquired over 60 days to maturity are valued using the latest bid prices or using valuations based on a matrix system (which considers such factors as security prices, yields, maturities, and ratings), both as furnished by independent pricing services. Other temporary cash investments are valued at amortized cost, which approximates market value.
B. Foreign Currency: Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars using exchange rates obtained from an independent third party as of the fund's pricing time on the valuation date. Realized gains (losses) and unrealized appreciation (depreciation) on investment securities include the effects of changes in exchange rates since the securities were purchased, combined with the effects of changes in security prices. Fluctuations in the value of other assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses) until the assets or liabilities are settled in cash, at which time they are recorded as realized foreign currency gains (losses).
Morgan Growth Fund
C. Repurchase Agreements: The fund enters into repurchase agreements with institutional counterparties. Securities pledged as collateral to the fund under repurchase agreements are held by a custodian bank until the agreements mature. Each agreement requires that the market value of the collateral be sufficient to cover payments of interest and principal. The fund further mitigates its counterparty risk by entering into repurchase agreements only with a diverse group of prequalified counterparties, monitoring their financial strength, and entering into master repurchase agreements with its counterparties. The master repurchase agreements provide that, in the event of a counterparty's default (including bankruptcy), the fund may terminate any repurchase agreements with that counterparty, determine the net amount owed, and sell or retain the collateral up to the net amount owed to the fund. Such action may be subject to legal proceedings, which may delay or limit the disposition of collateral.
D. Various inputs may be used to determine the value of the fund's investments. These inputs are summarized in three broad levels for financial statement purposes. The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.
Level 1—Quoted prices in active markets for identical securities.
Level 2—Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3—Significant unobservable inputs (including the fund's own assumptions used to determine the fair value of investments).
The following table summarizes the market value of the fund's investments as of December 31, 2015, based on the inputs used to value them:
| Level 1 | Level 2 | Level 3 | |
| Investments | ($000) | ($000) | ($000) |
| Common Stocks | 11,247,937 | 44,567 | — |
| Temporary Cash Investments | 355,389 | 157,990 | — |
| Futures Contracts—Assets1 | 645 | — | — |
| Futures Contracts—Liabilities1 | (2,969) | — | — |
| Total | 11,601,002 | 202,557 | — |
| 1 Represents variation margin on the last day of the reporting period. | |||
E. Futures Contracts: The fund uses index futures contracts to a limited extent, with the objective of maintaining full exposure to the stock market while maintaining liquidity. The fund may purchase or sell futures contracts to achieve a desired level of investment, whether to accommodate portfolio turnover or cash flows from capital share transactions. The primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks held by the fund and the prices of futures contracts, and the possibility of an illiquid market. Counterparty risk involving futures is mitigated because a regulated clearinghouse is the counterparty instead of the clearing broker. To further mitigate counterparty risk, the fund trades futures contracts on an exchange, monitors the financial strength of its clearing brokers and clearinghouse, and has entered into clearing agreements with its clearing brokers. The clearinghouse imposes initial margin requirements to secure the fund's performance and requires daily settlement of variation margin representing changes in the market value of each contract.
Futures contracts are valued at their quoted daily settlement prices. The aggregate settlement values of the contracts are not recorded in the Schedule of Investments. Fluctuations in the value of the contracts are recorded as an asset (liability).
Morgan Growth Fund
At December 31, 2015, the aggregate settlement value of open futures contracts and the related unrealized appreciation (depreciation) were:
| ($000) | ||||
| Aggregate | ||||
| Number of | Settlement | Unrealized | ||
| Long (Short) | Value Long | Appreciation | ||
| Futures Contracts | Expiration | Contracts | (Short) | (Depreciation) |
| E-mini S&P 500 Index | March 2016 | 2,161 | 219,925 | 1,831 |
Unrealized appreciation (depreciation) on open futures contracts is required to be treated as realized gain (loss) for tax purposes.
F. At December 31, 2015, the cost of investment securities for tax purposes was $8,588,248,000. Net unrealized appreciation of investment securities for tax purposes was $3,217,635,000, consisting of unrealized gains of $3,445,465,000 on securities that had risen in value since their purchase and $227,830,000 in unrealized losses on securities that had fallen in value since their purchase.
Item 2: Controls and Procedures
(a) Disclosure Controls and Procedures. The Principal Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.
(b) Internal Control Over Financial Reporting. During the last fiscal quarter, there was no significant change in the Registrant’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 3: Exhibits
(a) Certifications
| VANGUARD MORGAN GROWTH FUND | |
| By: | /s/ F. WILLIAM MCNABB III* |
| F. WILLIAM MCNABB III | |
| CHIEF EXECUTIVE OFFICER | |
| Date: February 18, 2016 | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| VANGUARD MORGAN GROWTH FUND | |
| By: | /s/ F. WILLIAM MCNABB III* |
| F. WILLIAM MCNABB III | |
| CHIEF EXECUTIVE OFFICER | |
| Date: February 18, 2016 | |
| VANGUARD MORGAN GROWTH FUND | |
| /s/ THOMAS J. HIGGINS* | |
| THOMAS J. HIGGINS | |
| CHIEF FINANCIAL OFFICER | |
| Date: February 18, 2016 | |
* By:/s/ Heidi Stam
Heidi Stam, pursuant to a Power of Attorney filed on April 22, 2014 see file Number 2-17620, Incorporated by Reference.
I, F. William McNabb III, certify that:
1. I have reviewed this report on Form N-Q of Vanguard Morgan Growth Fund;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 18, 2016 |
/s/ F. William McNabb III |
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F. William McNabb III |
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Chief Executive Officer |
0362216, v0.84
I, Thomas J. Higgins, certify that:
1. I have reviewed this report on Form N-Q of Vanguard Morgan Growth Fund;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 18, 2016 |
/s/ Thomas J Higgins |
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Thomas J. Higgins |
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Chief Financial Officer |
0362216, v0.84