The Fund seeks to provide current income while seeking to maintain liquidity and a relatively stable capital value. The return characteristics of the portfolio are expected to be broadly in line with the Bloomberg AusBond Bank Bill Index. The Fund invests in high-quality, short-term money market instruments and short-dated debt securities, including certificates of deposit, banker’s acceptances, commercial paper, euro commercial paper, government securities and other short-term or short-dated debt securities. 

Benefits of investing in the Vanguard Cash Reserve Fund

The significant features and benefits of investing in the Fund include:

• Competitive long-term performance - Vanguard's investment approach provides investors with an efficient way to capture long-term market performance.

• Diversification - The Fund provides exposure to a diversified portfolio of securities, which means the Fund is less exposed to the performance fluctuations of individual securities. This moderates the volatility of the portfolio and smooths out' investment returns over time.

• Low cost investing - The Fund has low ongoing fees as we strive to minimise the costs of managing and operating the Fund. The Fund typically has low portfolio turnover resulting in low trading costs such as brokerage and other transaction costs. 

The significant features and benefits of investing with Vanguard include:

• Stability and experience - The Vanguard Group, Inc. established the world's first index mutual fund for individual investors in 1976 and has been a leader in low cost index investing ever since. In Australia, Vanguard leverages the scale, experience and resources of our established global business. Investing in the Fund allows you to access the knowledge and skill of Vanguard as a specialist investment manager.

• Client focus - The Vanguard Group, Inc. was founded on a simple but revolutionary idea - that an investment company should manage the funds it offers in the sole interest of its clients. From rigorous risk management to transparent pricing to plain talk communications, we put our clients' interest first.

• Low costs - Investors can't control the markets, but they can control the costs of investing. Providing low cost investments isn't a pricing strategy for us. It's how we do business. Vanguard's scale also helps to keep costs low.

Summary risk level
Low

Relatively stable returns, with a low potential for loss of capital.

Who it may suit

Investors with a short-term investment horizon, or seeking a steady and reliable income stream.

Investors with a short-term investment horizon, or seeking a steady and reliable income stream.

Investment Strategy and Investment Return Objective

The Fund seeks to provide current income while seeking to maintain liquidity and a relatively stable capital value. The return characteristics of the portfolio are expected to be broadly in line with the Bloomberg AusBond Bank Bill Index. 

The Fund invests in high-quality, short-term money market instruments and short-dated debt securities, including certificates of deposit, banker's acceptances, commercial paper, euro commercial paper, government securities and other short-term or short-dated debt securities.

How we invest your money

The Fund will maintain a dollar-weighted average maturity of 70 days or less. Appropriate interest rate derivative financial instruments may be used from time to time to adjust the average maturity of the portfolio. From time to time the Fund may invest in floating rate securities and repurchase agreements that involve investing cash with either a commercial or an investment bank and receiving a high quality government or government related security as collateral for the term of the investment.

Strategic asset allocation* 

Australian fixed interest 100%

*This is a targeted strategic asset allocation. In addition, cash may be held for the purposes of liquidity management and derivatives may be used to manage market exposure.

Changing the investment strategy

Vanguard may from time to time vary the investment strategy of the Fund, including by changing the target benchmark for the Fund. Vanguard will notify investors of any such changes.