Vanguard Core series of model portfolios employs a prudent and efficient approach

The Vanguard Core series of model portfolios employs a prudent and efficient approach to guide global exposures across both stocks and bonds. The series’ rock-bottom fees further strengthen its appeal. Each portfolio earns a Morningstar Analyst Rating of Gold.

The model portfolios in this series are made available to advisors, who may retain discretion over the asset allocation and underlying fund selection. The 11 portfolios in the series span the risk spectrum; starting with a 100% allocation to stocks and decreasing in 10% increments to a 100% bond allocation. Each portfolio holds broadly diversified, low-cost Vanguard exchange-traded funds that effectively track their indexes. Within equities, the series holds Vanguard Total Stock Market ETF VTI and Vanguard Total International Stock ETF VXUS, both rated Gold (referenced ratings as of February 2021). The two fixed-income funds are Vanguard Total Bond Market ETF BND and Vanguard Total International Bond ETF BNDX, earning Gold and Silver ratings, respectively.

Vanguard’s investment strategy group developed this series and handles the day-to-day monitoring responsibilities. The strategic asset allocation committee, including 12 senior leaders at the firm, oversees asset allocation and portfolio construction efforts alongside the firm are other multi-asset offerings like the target-date and target-risk series.

A straightforward, index-oriented construction could be limiting compared to more actively focused model portfolio series, which may incorporate tactical tilts or utilize active underlying funds. However, the series’ focused approach to delivering broad asset class exposures at an extremely attractive price dampens concerns.

The series charges a 0.05% fee across each portfolio; a leader amongst model portfolio series. Its use of cheap but efficient Vanguard ETFs for broad market exposures underpins its attractive price, providing an enduring edge relative to more expensive peers. Model portfolios only provide guidance; users must implement their suggested trades and rebalance on their own. Investors’ results will vary depending on how closely they follow this profile’s recommendations.

General Advice Warning

Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.