Morningstar Advisor - Winter 2008 - 5

EDV VANGUARD EXTENDED DURATION TREASURY ETF A new ETF from Vanguard I Low cost, transparent, long effective duration. That’s the perspective this ETF provides. Designed to track the Lehman Brothers Treasury STRIPS 20-30 Year Equal Par Bond Index, this ETF is primarily suited for defined benefit pension plans who are looking to match long-term liabilities. It may also be suitable for other investors such as trusts or endowments who require the flexibility to significantly extend duration in the bond portion of their portfolios. Expertise, TM lower costs, and trusted name. Just what you’d expect from Vanguard. Connect with Vanguard® at 800-231-7865 or our dedicated advisors’ website at advisors.vanguard.com/etf. To buy or sell Vanguard ETFs,TM contact your financial advisor. Usual commissions apply. Not redeemable. Market price may be more or less than NAV. For more information about Vanguard ETFs, call or visit advisors.vanguard.com/etf to obtain a product description and prospectus. Investment objectives, risks, charges, expenses, and other information are contained in these documents; read and consider them carefully before investing. All ETFs are subject to risk, including possible loss of principal. Investments in bond funds are subject to interest rate, credit, and inflation risk. The Fund is primarily intended for pension plans and other institutional investors that desire to closely match long-term liabilities with a portfolio of U.S. Treasury securities of similar long-term duration. Interest rate risk is expected to be extremely high for the Fund because it invests mainly in zero coupon long-term bonds, which have prices that are very sensitive to interest rate changes. Because the Fund invests mainly in Treasury STRIPS with maturities ranging from 20 to 30 years, rising interest rates may cause the value of the Fund's investments to decline significantly. Prospective investors are urged to consult with their own advisors to determine the suitability of an investment in the Fund and the relationship of such an investment to their overall investment program and financial and tax positions. Vanguard Extended Duration Treasury ETF is not sponsored, endorsed, sold, or promoted by Lehman Brothers. Lehman makes no representation or warranty, express or implied, to the owners of Vanguard Extended Duration Treasury ETF or any member of the public regarding the advisability of investing in securities generally or in Vanguard Extended Duration Treasury ETF particularly or the ability of the Lehman Index to track general bond market performance. Lehman hereby expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect to the Lehman Index and any data included therein. Lehman’s only relationship to Vanguard and Vanguard Extended Duration Treasury ETF is the licensing of the Lehman Index which is determined, composed, and calculated by Lehman without regard to Vanguard or the Vanguard Extended Duration Treasury ETF. Lehman is not responsible for and has not participated in the determination of the timing of, prices of, or quantities of Vanguard Extended Duration Treasury ETF to be issued. Vanguard, Vanguard ETFs, Just what you’d expect from Vanguard, Connect with Vanguard, and the ship logo are trademarks of The Vanguard Group, Inc. All other marks are the exclusive property of their respective owners. ©2008 The Vanguard Group, Inc. All rights reserved. U.S. Pat. No.6,879,964 B2. Vanguard Marketing Corporation, Distributor.

http://advisors.vanguard.com/etf http://advisors.vanguard.com/etf http://advisors.vanguard.com/etf

Morningstar Advisor - Winter 2008

Table of Contents for the Digital Edition of Morningstar Advisor - Winter 2008