ETF Research Center

Vanguard Materials ETF seeks to track the performance of the MSCI US Investable Market Materials Index.

FUND BASICS
Category	US Equities
Fund Sponsor	Vanguard Group Inc/The
Website	www.vanguard.com
Inception date	Jan 30, 2004
Assets (mns)	$1,978
Currency	USD
Expense ratio	10 bp
Distributions	Quarterly

FUND STRUCTURE
Regulation	Open-Ended Fund
Custodian	Brown Brothers Harriman & Co
Weighting	Market Cap
Index replication	Full
Uses derivatives	No
Options available	Yes

SECTOR BREAKDOWN

CONSTITUENT BREAKDOWN
No. of constituents	115
Wgt avg mkt cap (mns)	$29,957
Large cap (>$10bn)	74.2%
Mid cap ($2-10bn)	21.4%
Small cap (<$2bn)	4.4%
Developed mkts	100.0%
Emerging mkts	0.0%

TOP TEN HOLDINGS
Total	51.4 %
PRAXAIR INC	13.3 %
AIR PRODUCTS & CHEMICALS INC	6.2 %
ECOLAB INC	5.9 %
SHERWIN-WILLIAMS CO/THE	5.4 %
DOW CHEMICAL	4.4 %
DOW, INC.	4.0 %
NEWMONT MINING CORP	4.0 %
PPG INDUSTRIES INC	3.1 %
BALL CORP	2.7 %
CORTEVA INC	2.5 %

TOP COUNTRY EXPOSURE
	UNITED STATES	81.7 %
	BRITAIN	17.6 %

HISTORICAL PERFORMANCE info

	Custom date range	Compare to
	thru

Standardized Annual Returns (thru January 31)
Year-to-date	1 year	5 years	10 years	Since Incep.
-6.5%	7.4%	5.8%	9.4%	8.1%

Market Correlations
versus...	Beta	R-squared
S&P500	1.14	80%
MSCI EAFE	1.19	73%
MSCI Emg. Mkts.	0.84	62%

Technical Indicators
Recent close	$131.42
30d moving avg.	$130.47
Annualized volatility	15.5%
Short interest (ETF)	0.0%
Short interest (Underlying)	3.5%
Relative strength (RSI)	52

Liquidity measures
Avg. volume (thou.)	61
Turnover	0.4%
Bid/Ask (% of price)	0.05%
ADV underlying (mns)	$6,147

Distributions

FINDING ALTERNATIVE FUNDS

Below is a list of 19 potential alternatives to the Vanguard Materials Index Fund ETF based on the alternatives' overlap in portfolio holdings with VAW. Consider funds with lower expense ratios and/or higher ALTAR Score™ ratings as possible alternatives.

Benchmark ticker:

VAW

Expense:

10 bp

ALTAR Score™:

7.8%

ALTERNATIVE ETFs BASED ON OVERLAP WITH VAW
Ticker	Fund Name	Overlap¹ vs VAW (%)	Expense ratio (bp)	Savings vs VAW (bp)	ALTAR Score™ (%)	ALTAR vs VAW (%)
FMAT	Fidelity MSCI Materials	99.2	8	2	7.8	-0.0
XLB	Materials Select Sector SPDR	77.3	13	-3	8.0	+0.2
IYM	iShares DJ US Basic Material	68.9	42	-32	7.6	-0.3
JHMA	John Hancock Multifactor Materials	68.3	40	-30	7.3	-0.5
RTM	Invesco S&P Equal Weight Materials	57.9	40	-30	7.6	-0.3
PYZ	Invesco Dynamic Basic Materials Sector	39.7	60	-50	5.4	-2.5
FXZ	First Trust Materials Alphadex	37.8	65	-55	7.7	-0.1
MXI	iShares S&P Global Materials	36.5	46	-36	6.5	-1.3
SZNE	Pacer CFRA-Stovall Equal Weight Seasonal Rotation	23.5	60	-50	6.9	-0.9
IGE	iShares North American Natural Resources	15.8	46	-36	4.4	-3.4
EQRR	ProShares Equities for Rising Rates	15.6	35	-25	7.8	-0.1
FTAG	First Trust Indxx Global Agriculture	14.6	70	-60	7.5	-0.3
XME	SPDR Metals & Mining ETF	12.7	35	-25	3.3	-4.6
GNR	SPDR S&P Global Nat. Resources	12.1	40	-30	6.8	-1.0
KNG	Cboe Vest S&P 500 Dividend Aristocrats Target Income	11.9	75	-65	5.3	-2.5
NOBL	ProShares S&P500 Aristocrats	11.9	35	-25	5.7	-2.1
NANR	SPDR S&P N. American Nat. Resources	11.7	35	-25	4.5	-3.4
TPHD	Timothy Plan High Dividend Stock	11.4	52	-42	6.5	-1.3
DIET	Defiance Next Gen Food & Agriculture	11.2	30	-20	4.7	-3.1

¹Overlap is the percentage of holdings by weight that are identical. For example, if Fund A has a 2% position in Apple, Inc. (AAPL) and Fund B has a 5% position, their overlapping position in AAPL is 2%.

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RESULTS & ESTIMATES

	2015	2016	2017	2018	2019	2020E	2021E
Sales per share	**	**	**	**	**	**	**
Earnings per share	**	**	**	**	**	**	**
Dividends per share	**	**	**	**	**	**	**
Book value per share	**	**	**	**	**	**	**

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

OTHER FUNDAMENTAL METRICS

Long term EPS growth est.	**%		Debt-to-equity	**x
Asset turnover	**%		Assets-to-equity	**x

Return on equity

Revision activity*

*Six months ago = 100

Net margins

Compound annual growth rates

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VALUATION METRICS

	2019	2020E	2021E
Price-to-sales	**	**	**
Price-to-earnings	**	**	**
Price-to-cash flow	**	**	**
Price-to-growth	**	**	**
Price-to-book value	**	**	**
Yield	**	**	**

Historical valuation trends

Forward multiple:	Vanguard Materials Index Fund
Relative to:	S&P500	MSCI EAFE	MSCI Emg. Mkts.	Other ETF:

SPECULATIVE

Deeply undervalued but risky. A rating of SPECULATIVE is assigned to ETFs with ALTAR Scores in the top quintile (the top 20%) of their category, indicating exceptional appreciation potential. However, often these are narrowly-focused funds or in industries with structural issues, which may also make them very risky. Nonetheless they may still be useful as part of a well-diversified portfolio.

ALTAR Score™

Calculation of ALTAR Score™
Avg. Return on Equity	13.7	%
Divided by: Fwd. P/BV	1.7	x
Less: Expense ratio	10	bp
Equals: ALTAR Score	7.8	%

More information on ALTAR Score™

MODERN PORTFOLIO THEORY info

CONSENSUS RECOMMENDATIONS: FUND CONSTITUENTS

COMPOSITE RATING	1.59	CATEGORY AVERAGE	1.56

The composite rating is a weighted average of analysts' consensus recommendations for individual ETF constituents, based on the following scale: BUY = 1; OVERWEIGHT = 1.5, HOLD = 2; UNDERWEIGHT = 2.5; and SELL = 3. Readers are cautioned that because analyst ratings tend to be inflated, the composite score may be more useful as a relative measure of sentiment between funds rather than as a stand-alone recommendation.