#USA #Vanguard #Valley Forge #Harris Associates #Aristotle Capital

Vanguard's New Investment Strategy: Key Changes in Advisory Teams

As of December 15, 2025, Vanguard has made notable adjustments to the investment advisory framework of its prominent funds, the Vanguard Windsor II Fund and the Vanguard Variable Insurance Fund – Diversified Value Portfolio. This strategic move removes Lazard Asset Management, the existing manager for both funds, and reallocates assets to Harris Associates LLC, doing business as Harris | Oakmark, as well as Aristotle Capital Management, LLC for the VVIF.

This decision is anticipated to result in a modest increase of 0.02% to the expense ratios of both funds. The changes suggest a redirection of investment strategy that could enhance the potential for returns while managing costs effectively.

For the Vanguard Windsor II Fund, the assets previously managed by Lazard, which comprised a targeted allocation of 25%, will now transition to Harris | Oakmark. The fund will maintain its current allocations with Hotchkis and Wiley Capital Management, LLC, Sanders Capital, LLC, and Aristotle Capital, each retaining a 25% target. This adjustment reflects Vanguard’s commitment to continuously optimize fund management performance.

In the case of the Vanguard Variable Insurance Fund (VVIF), Lazard’s substantial 60% allocation will be shifted equally to Harris | Oakmark and Aristotle Capital, each receiving 30%. Hotchkis and Wiley will preserve their existing 40% stake. Over time, the VVIF aims to balance its target allocation to an equal distribution of 33% among the three managerial firms, utilizing organic cash flow to achieve this reallocation.

Harris | Oakmark’s Expertise
Harris | Oakmark has joined Vanguard’s advisory ranks as a new collaboration. Established in 1976 and based in Chicago, this investment firm manages approximately $97 billion in assets as of September 2025. Harris | Oakmark focuses on firms trading below their intrinsic value, leveraging an independent, fundamental, bottom-up research methodology across various sectors to identify lucrative investment opportunities.

The selected management team from Harris | Oakmark boasts esteemed leaders, including:

• - William Nygren, CFA: He is a Partner and Chief Investment Officer for U.S equities, with extensive expertise managing various Oakmark funds.
• - Robert Bierig: Another integral member, Robert brings a wealth of experience in asset management and strategy execution, previously serving at Amethyst Capital Management and Morgan Stanley.
• - Michael Nicolas, CFA: Michael has a background as a Managing Director with Lakeview Investment Group and is known for managing diverse investment strategies.

Aristotle Capital's Role
Aristotle Capital, which has been advising the Windsor II since 2019, has now entered the VVIF advisory team as well. Specializing in both equity and fixed-income portfolio management, Aristotle aims to add value through active management strategies that align with long-term client goals. Their investment philosophy revolves around identifying promising businesses and constructing focused portfolios based on thorough analyses.

The Vanguard manager research team emphasizes ongoing evaluations of current and prospective advisors, prioritizing long-term drivers of success over short-term performance metrics. Vanguard's Board of Trustees and fund managers have concluded that these recent changes are aligned with the best interests of existing and future shareholders in both the Windsor II Fund and VVIF.

About Vanguard
Founded in 1975, Vanguard stands as one of the foremost investment management firms worldwide, offering various products and retirement services to millions of investors globally. Their unique, investor-owned structure ensures that fund shareholders directly benefit from Vanguard's operations, reinforcing their mission to advocate for all investors, guaranteeing fairness, and promoting favorable investment outcomes.

Investors seeking further insights about Vanguard funds are encouraged to consult their official website to access relevant documentation and evaluate investment objectives and potential risks before committing. Remember, all investments carry risks, including the possibility of losing principal.

Vanguard Marketing Corporation is the exclusive distributor for these funds.