According to a news release, the mutual fund company took the 50% formerly managed by Newell Associates and gave an extra 20% to Wellington Management – giving Wellington a new 50% total – and the remainder to its in-house Vanguard Quantitative Equity Group. Wellington is the fund’s lead advisor. Newell had been involved with the fund since its 1988 inception.
The third advisor, John A. Levin & Company, retains its 20% allocation under the new arrangement, Vanguard said.
“We believe the advisory team as now configured offers the best combination of investment approach, expertise, and resources to serve shareholders going forward,” said Vanguard Chairman John Brennan Mr. Brennan in a statement.
Of the three managers, Wellington attempts to identify stocks that offer above-average dividend yields, below-average valuations, and the potential for dividend increases in the future.
Levin employs fundamental research to select value-oriented investments, focusing on companies that have one or more of the following attributes: a strong proprietary product or service; selling at a discount; a new product or development; and/or a unique situation that offers attractive return prospects and limited downside risk.
Finally, the Vanguard Quantitative Equity Group uses quantitative valuation methods to build its portfolio from a universe of domestic large capitalization value stocks, focusing on issues with an above-average dividend yield. The Vanguard Quantitative Equity Group portfolio is expected to hold approximately 120 stocks.
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