Vanguard U.S. Multifactor ETF

Vanguard U.S. Multifactor ETF (VFMF) is an actively managed fund. It uses a computer model to pick U.S. stocks of all sizes that show three traits: strong recent price gains, strong fundamentals, and low prices relative to those fundamentals. It spreads its money widely. As of May 31, 2026, it held 613 stocks, and the top 10 made up under 9% of assets. Its 0.18% expense ratio is below the 0.27% average for similar funds.

• Over the year to Oct 27, 2026, VFMF returned +30.9%, 1st of 9 among similar funds.
• Its 5-year annualized return was +14.8%.
• Its worst full calendar year was 2022 (-5.7%); its best was 2021 (+30.0%).
• The deepest fall in its price history was 20.6% (Nov 25, 2024 to Apr 8, 2025), recovered by Aug 13, 2025.

As of May 31, 2026, the fund held 613 securities; the ten largest made up 8.87% of assets.

• Over the three months to May 31, 2026, investors added a net $50.7M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: -4.10%, +8.54%, +1.83%.

VFMF does not track an index. Vanguard's managers use a quantitative model, which is a rules-based computer screen, to score every stock in a universe of U.S. large-, mid- and small-company shares. The model looks for three traits that investors call "factors": momentum (relatively strong recent performance), quality (strong fundamentals) and value (low prices relative to fundamentals).

The model then builds one portfolio with exposure to all three factors. A screen promotes diversification and limits exposure to less liquid and more volatile stocks. Under normal conditions, at least 80% of net assets goes into U.S. companies. The result is broad and evenly spread. As of May 31, 2026, the fund held 613 stocks. The largest, Micron Technology, was about 1.2% of assets, followed by Newmont, Bristol-Myers Squibb, ConocoPhillips and Bank of New York Mellon. The top 10 made up 8.87%.

Holdings change often. The prospectus filed March 27, 2026 lists portfolio turnover of 66%. That means a year's trading equaled about two-thirds of the portfolio's value. Trading costs inside a fund are not part of its expense ratio. The fund also held a sliver of S&P 500 futures (about 0.01% of assets) and 0.23% in cash. Its shares trade on Cboe BZX at market prices. These usually stay close to the fund's net asset value but can differ.

• VFMF charges 0.18% a year, versus an average of 0.27% for the similar funds below (5th of 9, cheapest first).
• Of that, 0.15% is the management fee; the rest covers other fund expenses.
• Using the prospectus's standard example, $10,000 invested would cost about $18 in the first year and $230 over 10 years (assuming a 5% annual return).

It holds a broad basket of U.S. stocks but tilts toward value, quality and momentum, so it could sit next to a market-weighted index fund rather than replace it.

VFMF could add a tilt toward cheaper, financially strong companies with price momentum. Its record in downturns is mixed. It fell 29.97% in the first quarter of 2020. In the 2022 bear market it dropped 18.8% from January 4 to September 26, 2022, and took about 9.5 months to recover. Even so, it lost only 5.68% for calendar 2022, its worst calendar year. In price data starting June 2020, its deepest drop was 20.6%, from November 2024 to April 2025. It recovered in about 4.2 months. A retiree who had to sell during those stretches would have locked in losses.

Income is modest. The trailing yield was 1.37% as of October 27, 2026, paid quarterly. Costs are low: $18 in year one and $230 over 10 years on $10,000, using the SEC's standard example. Past results don't predict future returns, and a plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.