Vanguard International Growth Fund

Product brief
As of December 31, 2019

A multiadvisor equity portfolio that seeks to provide long-term capital appreciation by investing primarily in the
stocks of companies located outside Canada and the United States.

Product summary
• An actively managed fund with two independent subadvisors: Baillie Gifford Overseas Limited and Schroder Investment
Management North America Inc. Each subadvisor uses distinct fundamental investment strategies in managing separate
portions of the fund’s assets and follows a proven investment philosophy and process.
• Applications: This fund may be suitable for investors with a long-term perspective (three years or longer) and medium risk
tolerance who seek international diversification to complement their existing Canadian/U.S. holdings and/or wish to
participate in an international equity fund that emphasizes companies with strong growth potential.
• Benchmark:1 MSCI ACWI ex USA Index. The index captures large- and mid-cap companies across 22 developed markets
and 24 emerging markets, excluding the U.S. The index covers approximately 85% of global equities outside the U.S.

Key facts Risk rating

Fund code VIC400 Low to Medium
Low Medium High
medium to high
CIFSC category International Equity
Inception date June 20, 2018
Management fee2 0.40% Subadvisor allocation
MER3 0.61%
Net assets $99.2 M n 59% Baillie Gifford Overseas Limited
Currency CAD n 40% Schroder Investment Management
North America Inc.
Annually (net income and net
Distribution schedule n 1% The Vanguard Group, Inc. (cash)
capital gains)
Minimum investment $5,000 initial, $100 additional
RRSP, RRIF, RESP, TFSA, DPSP, Style map
Eligibility
RDSP, Non-reg
Large-cap

Mid-cap

Small-cap

Value Blend Growth

1 This fund is actively managed and does not seek to track the performance of a benchmark. Please see “Important information” on the benchmark, including the reason
for using the benchmark and the differences between the benchmark and the fund’s investment strategy.
2 The management fee is equal to the fee paid by the Vanguard fund to Vanguard Investments Canada Inc. and does not include applicable taxes or other fees and
expenses of the Vanguard fund. The management fee is from period June 25, 2018 to June 30, 2019 and is calculated on a semi-annual basis. As a result of a
management fee waiver program, this fee may change and could be up to a maximum of 50bps. Please see the fund’s prospectus for detailed information on the
management fees and the management fee waivers applicable to the fund.
3 Management expense ratio (MER) is the MER as of March 31, 2019, including waivers and absorptions and is expressed as an annualized percentage of the daily
average net asset value. The MER would have been 0.63% without any absorptions or waivers. Vanguard Investments Canada Inc. expects to continue absorbing or
waiving certain fees indefinitely, but may, in its discretion, discontinue this practice at any time.

FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY. NOT FOR PUBLIC DISTRIBUTION.
Performance summary of Vanguard International Growth Fund*
Total returns4 for period ending December 31, 2019 (CAD)
25%

20

15

10

0
Since
3 months Year to date 1 year 3 years 5 years 10 years inception**
 Fund 11.89% 24.71% 24.71% 16.60% 13.15% 11.04% 10.82%
 Benchmark*** 6.68% 15.37% 15.37% 8.64% 7.92% 6.93% 8.84%
*Please see “Important information” for significant disclosures regarding the performance shown, which represents the actual historical returns of Investor Shares of
the U.S.-domiciled Vanguard International Growth Fund, which has a similar investment mandate to the Canada-domiciled Vanguard International Growth Fund and
is managed by the same investment advisors. The benchmark shown is a spliced international index: MSCI EAFE Index through May 31, 2010; MSCI All Country World
Index ex USA thereafter.
  **Returns since September 30, 1981, the inception date of Investor Shares of the U.S.-domiciled Vanguard International Growth Fund.
***The U.S.-domiciled Vanguard International Growth Fund is actively managed and does not seek to track the performance of its benchmark. Please see “Important
information” on the benchmark, including the reason for using the benchmark and the differences between the benchmark and the fund’s investment strategy.

Equity characteristics Fund Benchmark Sector weighting5 Fund Benchmark

Number of stocks 117 2,412 Consumer Services 30.1% 8.9%
Median market cap $73.2B $47.5B Technology 15.9 9.6
Price/earnings ratio 32.3x 16.8x Consumer Goods 15.4 14.5
Price/book ratio 3.4x 1.7x Financials 12.1 24.7
Return on equity 15.5% 13.1% Health Care 11.2 9.0
Earnings growth rate 20.0% 9.7% Industrials 9.1 13.1
Cash investments 1.0% — Basic Materials 3.2 6.5
Equity yield (dividend) 1.4% 3.1% Oil & Gas 2.0 6.6
Telecommunications 1.1 3.7
Top 10 holdings (% of total net assets) 6 Fund
Utilities 0.0 3.3
Alibaba Group Holding Ltd. 5.6%
Total 100.0% 100.0%
Tencent Holdings Ltd. 5.2
ASML Holding NV 5.0
AIA Group Ltd. 3.1 Market allocation Fund
Amazon.com Inc. 3.0 China 18.8%
MercadoLibre Inc. 2.5 Japan 10.2
Kering SA 2.3 United States 10.2
Illumina Inc. 2.1 France 8.4
TAL Education Group 2.0 Germany 7.2
Ferrari NV 2.0 United Kingdom 6.9
Top Ten Total 32.8% Netherlands 5.8
The holdings listed exclude any temporary cash investments and equity index products. Switzerland 5.3
Volatility Fund 4 Sweden 4.7
Standard deviation 13.01% Hong Kong 4.5
Beta 1.34 Total (% of net assets) 82.0%
Upside capture 145.87
Downside capture 114.46

4 Information as of December 31, 2019. Because the fund is new, information shown is for Investor Shares of U.S.-domiciled Vanguard International Growth Fund,
which has a similar investment mandate to the Canada-domiciled Vanguard International Growth Fund and is managed by the same investment advisors. Please
see “Important information.” Data sourced from FactSet and Vanguard Investments Canada.
5 Please see “Important information” for sector weightings. Total may not sum to 100% due to rounding.
6 Please see “Important information” for the number of holdings.
Due to rounding, discrepancies with figures may occur.
FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY. NOT FOR PUBLIC DISTRIBUTION. 2
Investment advisors
Vanguard International Growth Fund is managed primarily by two independent
subadvisors: Baillie Gifford Overseas Limited and Schroder Investment Management Our enduring
approach to

North America Inc. The Vanguard Group, Inc., manages the cash portion of the portfolio.
selecting
active managers

The multiadvisor structure provides investment style diversification and the potential for
We’re actively different

less volatility than in similar single-advisor funds, while allowing individual subadvisors the Wellington
Management
Canada ULC

Baillie Gifford

opportunity to generate superior returns. For more information on Vanguard’s manager

Overseas Ltd.
Pzena
Investment
Management,
LLC
Vanguard

selection and oversight process, please see Our enduring approach to

Quantitative
Equity Group Schroder Investment
Management
North America Inc.
This document is for financial advisor and accredited investor use only and is not for public distribution.

selecting active managers at vanguardcanada.ca/managerselection.

Overview of advisors

Baillie Gifford Overseas Limited Schroder Investment Management North America Inc.
Portfolio manager James Anderson, Thomas Coutts Simon Webber
Investment focus Large- and mid-cap international equity Large- and mid-cap international equity
Investment style Growth Growth at a reasonable price (GARP)

FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY. NOT FOR PUBLIC DISTRIBUTION. 3
 Profile: Baillie Gifford
Key facts
Founded in 1908. More than 100 investment professionals.
Headquartered in Edinburgh, Scotland. Private partnership that is among the largest independently
owned investment management firms in the United Kingdom.
Approximately USD 252 billion in assets under management
as of September 30, 2019.

Portfolio management

James Anderson Thomas Coutts

• Portfolio manager. • Portfolio manager.
• Advised the fund since 2003. Advised the mandate since 2018. • Advised the fund since 2018. Advised the mandate since 2016.
• Worked in investment management since 1983. • Worked in investment management since 1999.
• BA, Oxford University. • BA, Oxford University.

Manager highlights

Baillie Gifford’s long-term investment approach is The Portfolio Construction Group (PCG) is responsible
employed by a deep and experienced team of investors for stock selection; it takes advantage of the insights
who are willing to think differently than the market. of other specialist investment teams at Baillie Gifford.

Investment focus
Asset class International growth
Investment style Growth
Annual turnover (target range) 15%–30%
Number of holdings (target range) 50–70
Investment themes The advisor seeks special cultures and management, competitive strength in
underestimated technological shifts, and global industrial growth companies
with competitive advantages.

Investment philosophy/process

• Baillie Gifford believes that superior growth leads to
share-price outperformance in the long term and that one
must be willing to invest with conviction, sometimes in
unfashionable opportunities, to deliver outperformance.
• It believes that patience turns time and volatility to an
investor’s advantage.
• The advisor seeks to identify companies with long-term,
sustainable competitive advantages by developing deep
industry and company knowledge.
• Baillie Gifford is willing to pay a valuation premium for
exceptional long-term growth companies.

Opportunity Execution Valuation

• Market background. • Ability to capitalize on • Determine the extent to which

– Industrial growth rate.
– Pricing structure.
• Competitive advantages.
– Barriers to entry.
– Uniqueness of products.
– Cost advantages.
the market opportunity.
• Financial structure.
• Management.
– Shareholder-orientation.
– Long-term focus.
– Capital allocation.
the market already appreciates
the strengths.
• Markets often underestimate
the time horizon of the growth
opportunity for great companies.

FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY. NOT FOR PUBLIC DISTRIBUTION. 4
 Profile: Schroders
Key facts
Founded in 1804. More than 400 investment professionals worldwide.
Headquartered in London, England. Private partnership that is among the largest independently
owned investment management firms in the United Kingdom.
Approximately USD 566 billion in assets under management
as of September 30, 2019.

Portfolio management

Simon Webber, CFA

• Portfolio manager. • Worked in investment management since 1999.
• Advised the fund since 2018. Advised the mandate since 2009. • BSc, University of Manchester.

Manager highlights

The portfolio manager leverages the support of Schroders’ portfolio combines investments in core and
dedicated global sector specialists who work closely with opportunistic stocks.
Schroders’ extensive global research network of more
than 70 local equity analysts located around the globe.

Investment focus
Asset class International equity
Investment style Growth at a reasonable price (GARP)
Annual turnover (target range) 40%–60%
Number of holdings (target range) 60–70
Investment themes The advisor focuses on future earnings growth resulting from sustainable
competitive advantages and key structural trends within a company’s industry or the
global economy and seeks to purchase these companies at reasonable valuations.

Investment philosophy/process

• Schroders believes quality growth companies with
sustainable competitive advantages selling at reasonable
prices produce superior long-term returns.
• Schroders leverages fundamental research to identify quality
growth stocks selling at attractive valuations with sustainable
competitive advantages. The team conducts its bottom-up
research within the context of key structural trends that will
influence a company’s future growth potential, seeking to
identify a “growth gap” between what the market expects
and what the team believes the company can achieve.

Step 1 Step 2 Step 3 Step 4

Filter universe Research local expertise/ Stock selection Portfolio construction

global perspective and risk control
Quantitative screens confirm/challenge views

Local analysts Local Best ideas Two types

Global • Growth of holdings
grade liquidity- research
sector
screened stocks grades • Quality • Core
overlay
on 1–4 scale 1&2 • Valuation • Opportunistic

1,600 stocks 500 stocks 130–150 stocks 60–70 stocks

FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY. NOT FOR PUBLIC DISTRIBUTION. 5
Connect with Vanguard®  > vanguardcanada.ca
Contact your Vanguard Investments Canada sales team or financial advisor for more information.
Important information
Date of publication: January 2020
Performance of Vanguard International Growth Fund: The
performance of the Vanguard fund shown here is based on actual
historical returns of Investor Shares of the U.S.-domiciled Vanguard
International Growth Fund. The indicated rates of return are the
historical annual compounded total returns including changes in price
and reinvestment of all dividends or distributions and do not take into
account sales, redemption, distribution or optional charges or income
taxes payable by any investors that would have reduced returns.
Vanguard International Growth Fund is regulated under applicable
U.S. laws and bears expenses that are different from the Canada-
domiciled Vanguard International Growth Fund. The U.S.-domiciled
Vanguard International Growth Fund is not being marketed in Canada
and investors in Canada may not purchase its securities. The
performance of the U.S.-domiciled Vanguard International Growth
Fund is for illustrative purposes only and is not intended to reflect
future value of, or returns on investments in that fund or the Canada-
domiciled Vanguard International Growth Fund.
Use of the benchmark: The MSCI ACWI ex USA Index was
chosen as the fund’s benchmark because it is a broad-based global
developed equity market index. Although the fund uses this index
for long-term performance comparisons, it is not managed relative
to the composition of the index. There are differences between
the fund and the index in, among other things, security holdings
and geographical and sector allocations. As a result, the fund may
experience periods when its performance differs materially from
that of the index. The performance of an index is for illustrative
purposes only and is not intended to reflect the future value of,
or return on investment in, the fund.
Number of holdings: The number of holdings shown is unaudited
and should not be relied upon as investment advice.
Sector allocations: The sector allocations provided exclude any
temporary cash investments. Sector categories are based on the
Global Industry Classification Standard (GICS), except for the Other
category (if applicable), which includes securities that have not been
provided a GICS classification as of the effective reporting period.
CFA® is a registered trademark owned by CFA Institute.
The Global Industry Classification Standard (“GICS”) was developed
by and is the exclusive property and a service mark of MSCI Inc.
FOR FINANCIAL ADVISOR AND ACCREDITED INVESTOR USE ONLY.
NOT FOR PUBLIC DISTRIBUTION.
(“MSCI”) and Standard and Poor’s, a division of McGraw-Hill
Companies, Inc. (“S&P”) and is licensed for use by Vanguard. Neither
MSCI, S&P nor any third party involved in making or compiling the
GICS or any GICS classification makes any express or implied
warranties or representations with respect to such standard or
classification (or the results to be obtained by the use thereof), and
all such parties hereby expressly disclaim all warranties of originality,
accuracy, completeness, merchantability or fitness for a particular
purpose with respect to any such standard or classification. Without
limiting any of the foregoing, in no event shall MSCI, S&P, any of its
affiliates or any third party involved in making or compiling the GICS
or any GICS classification have any liability for any direct, indirect,
special, punitive, consequential or any other damages (including lost
profits) even if notified of the possibility of such damages.
While this information has been compiled from sources believed to
be reliable, Vanguard Investments Canada Inc. does not guarantee
the accuracy, completeness, timeliness or reliability of this
information or any results from its use. Information, figures and
charts are summarized for illustrative purposes only and are subject
to change without notice. This material is for informational purposes
only. This material is not intended to be relied upon as research,
investment, or tax advice and is not an implied or express
recommendation, offer or solicitation to buy or sell any security or
to adopt any particular investment or portfolio strategy.
All investments are subject to risk, including the possible loss of
principal. Foreign investing involves additional risks, including
currency fluctuations and political uncertainty. This material does not
constitute an offer or solicitation and may not be treated as an offer
or solicitation in any jurisdiction where such an offer or solicitation is
against the law, or to anyone to whom it is unlawful to make such an
offer or solicitation, or if the person making the offer or solicitation is
not qualified to do so.
Commissions, management fees, and expenses all may
be associated with investment funds. Investment
objectives, risks, fees, expenses, and other important
information are contained in the prospectus; please
read it before investing. Investment funds are not
guaranteed, their values change frequently, and past
performance may not be repeated. Vanguard funds are
managed by Vanguard Investments Canada Inc. and are
available across Canada through registered dealers.
© 2020 Vanguard Investments Canada
All rights reserved.
INADQ_CA_IG 012020