Vanguard's investment philosophy

Vanguard offers the tenets of the firm's investment philosophy

 * Vanguard's Investment Philosophy We Believe #1

"Investing is for meeting long-term goals; saving is for meeting short-term goals."


 * Vanguard’s Investment Philosophy We Believe #2

"Broad diversification, with exposure to all parts of the stock and bond markets, reduces risk."


 * Vanguard’s Investment Philosophy We Believe #3

"An investor’s most important decision is selecting the mix of assets to be held in a portfolio, not selecting the individual investments themselves."


 * Vanguard’s Investment Philosophy We Believe #4

"Consistently outperforming the financial markets is extremely difficult."


 * Vanguard’s Investment Philosophy We Believe #5

"Minimizing cost is vital for long-term investment success."


 * Vanguard’s Investment Philosophy We Believe #6

"Investors should know how each investment fits into their plans and why they own that particular asset."


 * Vanguard’s Investment Philosophy We Believe #7

"Risk has many dimensions, and investors should weigh “shortfall risk”—the possibility that a portfolio will fail to meet longer-term financial goals—against “market risk,” or the chance that returns will fluctuate."
 * Vanguard’s Investment Philosophy We Believe #8

"Market-timing and performance-chasing are losing strategies."


 * Vanguard’s Investment Philosophy We Believe #9

"An investor should not expect future long-term returns to be significantly higher or lower than long-term historical returns for various asset classes and subclasses."