Overview |
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Investment Objective
The Portfolio seeks to provide inflation protection and income consistent with investment in inflation-indexed securities.
Investment Strategy
The Portfolio invests 100% of its assets in Vanguard® Inflation-Protected Securities Fund. The Fund invests at least 80% of its assets in inflation-indexed bonds issued by the U.S. government, its agencies and instrumentalities, and corporations. The Fund may invest in bonds of any maturity; however, its dollar-weighted average maturity is expected to be in the range of 7 to 20 years. At a minimum, all bonds purchased by the Fund will be rated "investment-grade or, if unrated, will be considered by the advisor to be investment-grade." Unlike a conventional bond, whose issuer makes regular fixed interest payments and repays the face value of the bond at maturity, an inflation-indexed security (IIS) provides principal and interest payments that are adjusted over time to reflect a rise (inflation) or a drop (deflation) in the general price level for goods and services. In the event of deflation, the U.S. Treasury has guaranteed that it will repay at least the face value of an IIS issued by the U.S. government.
NOTE: The Inflation-Protected Securities Portfolio seeks to provide protection from inflation (i.e., a rise in the general price level of goods and services), as measured by the Consumer Price Index. It is possible that the costs of higher education may increase at a rate that exceeds the rate of increase of the Consumer Price Index.
Investment Risks
The Portfolio is subject to a high level of income-fluctuation risk. The Portfolio also has moderate to high levels of interest rate risk and low levels of manager risk and derivatives risk.
Average Annual Returns - Updated Monthly as of
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**Includes the inflation-indexed securities within the Bloomberg Barclays U.S. Treasury Index, which represents U.S. Treasury obligations with maturities of more than 1 year. Effective September 29, 2016, Barclays indexes were rebranded to Bloomberg Barclays indexes.
Annual Investment Returns
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Index performance is provided as a benchmark but is not illustrative of any particular investment. An investment cannot be made in an index.
The performance data shown represents past performance. Past performance - especially short-term past performance - is not a guarantee of future results. Investment returns and principal value will fluctuate, so that investors' units, when sold, may be worth more or less than their original cost. Current performance may be higher or lower than the performance data cited.
