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Originally Posted by Spanky
Does anyone know the reason that Vanguard does not offer any stable value fund for their employer-sponsored retirement accounts?
It seems odd since most (2/3) offer them.
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Our company has their 401(k) through Vanguard, and they do offer a stable value fund: Vanguard Retirement Savings Trust:
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Vanguard® Retirement Savings Trust seeks stability of principal and a high level of current income consistent with a 2-3 year average maturity. The trust is a tax-exempt collective trust invested primarily in investment contracts issued by insurance companies and commercial banks, and similar types of fixed-principal investments. The trust intends to maintain a constant net asset value of $1.00 per share. Investments in Vanguard Retirement Savings Trust are limited to participant-directed defined contribution plans and, with Vanguard’s approval, other qualified pension plans.
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Strategy and Policy
Investment strategy
The fund invests primarily in investment contracts issued by insurance companies, banks or other financial institutions, including investment contracts backed by high-quality fixed income securities.
The fund seeks to achieve its objective by diversifying among high credit-quality investments and investment contracts which are structured to smooth market gains and losses over time.
Investment policy
* The trust invests in a combination of synthetic contracts (backed primarily by Vanguard® bond funds), traditional investment contracts backed by major insurance providers, and bank contracts.
* The trust’s strict credit guidelines require that traditional investment contracts be rated at least AA.
* The trust will maintain an average maturity between 2-3 years.
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see Vanguard's Commingled Trusts.
- Alec
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