Vanguard VIF Real Estate Index Portfolio


Investment Objective

The Portfolio seeks to provide a high level of income and moderate long-term capital appreciation by tracking the performance of a benchmark index that measures the performance of publicly traded equity REITs and other real estate-related investments.

Principal Investment Strategies

The Portfolio employs an indexing investment approach designed to track the performance of the MSCI US Investable Market Real Estate 25/50 Index. The Index is made up of stocks of large, mid-size, and small U.S. companies within the real estate sector, as classified under the Global Industry Classification Standard (GICS). The GICS real estate sector is composed of equity real estate investment trusts (known as REITs), which includes specialized REITs, and real estate management and development companies. The Portfolio attempts to replicate the Index by investing all, or substantially all, of its assets in the stocks that make up the Index, holding each stock in approximately the same proportion as its weighting in the Index.

Principal Investment Risks

An investment in the Fund is subject to the following risks which are described in more detail in the Statutory Prospectus.

An investment in the Portfolio could lose money over short or long periods of time. You should expect the Portfolio's share price and total return to fluctuate within a wide range. The Portfolio is subject to the following risks, which could affect the Portfolio's performance:

  • Industry concentration risk, which is the chance that the stocks of REITs and other real estate-related investments will decline because of adverse developments affecting the real estate industry and real property values. Because the Portfolio concentrates its assets in these stocks, industry concentration risk is high.
  • 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. The Portfolio's target index may, at times, become focused in stocks of a limited number of companies, which could cause the Portfolio to underperform the overall stock market.
  • Asset concentration risk, which is the chance that, because the Portfolio's target index (and therefore the Portfolio) tends to be heavily weighted in its ten largest holdings, the Portfolio's performance may be hurt disproportionately by the poor performance of relatively few stocks.
  • Interest rate risk, which is the chance that REIT stock prices overall will decline, and that the cost of borrowing for REITs will increase because of rising interest rates. Interest rate risk is high for the Portfolio.
  • Investment style risk, which is the chance that returns from REIT stocks—which typically are small- or mid-capitalization stocks—will trail returns from the overall stock market. Historically, REIT stocks have performed quite differently from the overall market.

An investment in the Portfolio is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

AS OF 8/13/2020
Year to Date -11.95%
Prior 3 Months 7.61%
Prior 1 Year -6.54%
Prior 3 Years 1.71%
Prior 5 Years 3.59%
Prior 10 Years* 5.38%
Date of Inception1: 08/05/2013
* Or since inception if the Fund has been in existence for less than 120 months.
1 Date of Inception shown is the date the Underlying Fund became available to the Separate Account, in accordance with a current SEC staff position. An Underlying Fund may have begun operations at an earlier date.

The performance data shown represent past performance, which is not a guarantee of future results. Investment returns and unit values will fluctuate so that units, when redeemed, may be worth more or less than their original cost. Investment Fund total return performance currently may be lower or higher than the figures stated above.

The total return performance data are based on a hypothetical investment of $1,000, which is redeemed at the end of the periods shown. The total return figures reflect the reinvestment of investment income and capital gains and losses, and are net of expenses which include a contract fee, an expense risk fee, administrative charges, a distribution expense charge and Underlying Funds fees and expenses.

The total return figures for periods extending beyond a year are average rates of return and do not reflect the Funds' actual year-to-year results, which varied over the periods shown. Contributions or withdrawals made within a period would experience different rates of return based on the unit values on the dates of such transactions.

Portfolio Information for the Vanguard VIF Real Estate Index Portfolio
Portfolio Turnover Rate

Portfolio Turnover Rate(%): 10%**Excludes all short-term securities.

Industry Allocation as of 3/31/2020
Industry% of Portfolio
Diversified REITs4.7%
Industrial REITs7.2%
Office REITs9.9%
Residential REITs14.0%
Retail REITs14.1%
Specialized REITs32.4%
Hotel & Resorts REITs4.8%
Health Care REITs9.5%
Real Estate Operating Cos.0.3%
Real Estate Development0.4%
Real Estate Services 2.6%
Diversified Real Estate Activities0.1%
The above Portfolio Information is provided to illustrate the types of securities in which the Portfolio may invest. The information is subject to change and may not represent the Portfolio's current or future holdings.
Top Ten Holdings as of 3/31/2020 (reflects most recent information available)
Company % of Portfolio
American Tower corp.7.5%
Simon Property Group Inc.4.9%
Crown Castle International Corp.4.6%
Prologis Inc.3.9%
Equinix Inc.3.2%
Public Storage3.0%
Welltower Inc.2.5%
Equity Residential2.4%
AvalonBay Communities Inc. 2.4%
Digital Realty Trust Inc.2.1%
The above Portfolio Information is provided to illustrate the types of securities in which the Portfolio may invest. The information is subject to change and may not represent the Portfolio's current or future holdings.
Manager Biography

Walter Nejman, Portfolio Manager at Vanguard. He has been with Vanguard since 2005, has worked in investment management since 2008, and has co-managed the Portfolio since 2016. Education: B.A., Arcadia University; M.B.A., Villanova University.

Gerard C. O'Reilly, Principal of Vanguard. He has been with Vanguard since 1992, has managed investment portfolios since 1994, and has managed the Portfolio since its inception in 1999 (co-managed since 2016). Education: B.S., Villanova University.

You should consider the investment objectives, risks, and charges and expenses of the variable annuity contract and the underlying investment funds carefully before investing. This and other information is contained in the contract prospectus or brochure and underlying funds prospectuses and summary prospectuses, which can be obtained by calling 800.468.3785 or visiting Read them carefully before investing.

Investment Options