Stable value

Overview

The goal of stable value funds in a portfolio is capital preservation. They invest, directly or indirectly, in high-quality, short- to intermediate-term fixed income investments and are distinguished from bond funds by maintaining a constant $1 share price net asset value (NAV).

The stable value funds hold insurance contracts to wrap the underlying fixed income strategies. This allows the stable value fund to use book-value accounting, permitting the fund to maintain the stable share price.

Why Vanguard stable value?

Vanguard has been managing stable value since 1984. In that time, our stable value products have had solid performance thanks to our robust process of allocation and selection across highly diversified asset classes in the underlying strategies. We can also help ensure that the underlying assets are still covered to help protect the $1 NAV because we have one of the highest numbers of issuers in the industry.

We believe stable value can be a valuable investment option for conservative investors. Given that the primary goal of stable value is principal preservation, we tend to utilize a conservative investment approach that focuses on high-quality bonds, and our goal is to leverage the strength of our active portfolio management teams to deliver competitive returns over the long term, while maintaining a high-quality bias. Neena Saxena Head of Stable Value Investments

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A stable value investment is neither insured nor guaranteed by the U.S. government. There is no assurance that the investment will be able to maintain a stable net asset value, and it is possible to lose money in such an investment.

All investing is subject to risk, including the possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss.