Louie: There are several factors that set our funds apart, and it starts with our team. First, our portfolio managers also act as traders. It’s a unique organizational structure in this industry, and it helps us gain efficiencies, be more productive, and manage risk. We work closely as a team to leverage our deep and broad knowledge of the benchmarks we track and the markets we invest in.
The experience we share as a team gives us the ability to respond to unusual situations, whether it’s the volatility of the past few years or the addition of a huge company like Tesla to the S&P 500 Index. Tesla was a $15 billion trade—the single biggest name we’ve ever traded. That’s the type of transaction that you want a seasoned, tenured professional to handle!
Beyond our structure, there is something special about the way our team members support each other and believe in our collective mission of creating investor value. I love it on a personal level, but from an investor’s standpoint, our organizational structure creates more efficiencies and our team approach helps us to surface the best ideas and drive better outcomes for them.
Vanguard is investor-owned, which means our interests are aligned with those of our investors. As a team, we do everything we can to provide the best investment experience for Vanguard shareholders. Our objective is to track the benchmark, but if we can return value to temper the impact of a fund’s expense ratio—Vanguard’s average is just 0.09% as of December 31, 2021—we will do so. Our scale is an advantage, but at the same time we run a lean organization. We’re a small group considering how much money we manage. To track tightly, we review and assess portfolio risk, performance, and trading strategy and executions daily.