Vanguard Growth and Income Fund Admiral Shares VGIAX

Vanguard Growth and Income is in the hands of three capable subadvisors, though its aggregated portfolio lacks distinctiveness. It earns an Above Average People rating and an Average Process rating.

The strategy continues to benefit from a deep and capable three-subadvisor structure. Mary Pryshlak leads Wellington’s sleeve alongside a seasoned group of nine sector analysts averaging roughly 25 years of industry experience. Max Stone and Konstantin Turitsyn lead D.E. Shaw’s quantitative sleeve and leverage the firm’s extensive research resources, while Hal Reynolds and Kristin Ceglar continue to guide Los Angeles Capital’s portion of the portfolio. Each subadvisor manages roughly one-third of assets, creating balanced portfolio contributions and diversified sources of insight.

Each subadvisor employs a reasonable process, but their approaches combine to produce a rather undifferentiated overall portfolio. Los Angeles Capital and D.E. Shaw continue to rely on quantitative frameworks, though each pursues a different path: Los Angeles Capital focuses on predictive signals to anticipate shifting risk premiums, while D.E. Shaw relies more heavily on technical signals such as price movements and neutralizes traditional quant factors like value, size, and momentum. Wellington complements those approaches with bottom-up fundamental research, adding a different source of insight to the strategy. The end result is an aggregate portfolio of over 600 stocks that has similar sector weightings, valuation metrics, and profitability ratios to those of the strategy’s S&P 500 prospectus benchmark.

Owing to the strategy's dearth of distinctive portfolio characteristics, its returns should broadly mirror those of the S&P 500 over time but outpace the typical large-blend Morningstar Category peer. Case in point: The investor share class’ 29.5% return over the trailing 12 months through May 2026 matched that of the index but beat the typical peer's 25.5%. Over the trailing 10 years through May 2026, the fund's 15.4% annualized return lagged the benchmark by 0.2 percentage points but outpaced the typical peer by 2.1 percentage points. Investors should not look to this strategy for home-run swings, but for small outperformance on the margins.

The three subadvisors' approaches are sound individually, but together they produce an undifferentiated, sprawling portfolio. The strategy warrants an Average Process rating.

Vanguard’s replacement of its in-house quant team with Wellington in 2023 added a fresh fundamental view to this traditionally quant-focused strategy. Nine sector analysts run Wellington’s sleeve of the portfolio. Each analyst uses a tailored framework within their sector, emphasizing a bottom-up strategy focused on finding companies with reasonable valuations, strong fundamentals, and credible management.

Longtime subadvisors Los Angeles Capital and D.E. Shaw continue to rely on proven quant approaches. Los Angeles Capital frequently updates its model’s weightings to ensure its factors remain aligned with evolving market preferences. An investment committee conducts quarterly reviews and annually approves the research agenda, including any proposed changes to the model’s factors. D.E. Shaw utilizes models aimed at uncovering pricing inefficiencies at the individual stock level. Rather than relying on conventional quant factors like value, size, or momentum, these models focus on technical signals such as price movements, event-driven catalysts like acquisitions, and fundamental metrics, including balance-sheet strength. Each subadvisor runs about one-third of the portfolio’s assets.

The approaches have merit, but their finer traits don’t shine as the three sleeves converge into a portfolio that is less compelling and differentiated than the sum of its parts.

Strict portfolio guardrails leave little room for the portfolio to differentiate itself. Both sector and individual stock weightings tend to stay within 1 percentage point of the strategy’s S&P 500 prospectus benchmark. As of March 2026, the portfolio’s only sector bet above this threshold was a 4.5-percentage-point underweighting in the technology sector. At the individual stock level, the portfolio was around a percentage point underweight in Nvidia, Apple, Alphabet, and Microsoft. Its heaviest stake in an out-of-benchmark holding was Taiwan Semiconductor Manufacturing, which accounted for only 0.4% of the portfolio’s assets. The portfolio’s active share, a measure of how different a portfolio is compared with a benchmark, was just 37% as of March 2026, well below the typical large-blend category peer’s 56%.

The portfolio looks like its benchmark in other ways, too. Price metrics such as price/earnings, price/sales, and price/free cash flow have all been in line with the index’s, while profitability metrics such as return on equity, return on assets, and return on invested capital also closely resembled those of the benchmark.

Since Wellington replaced Vanguard’s quant team as a subadvisor, the portfolio’s total holdings have come down. The March 2026 portfolio’s 723 holdings were down from the 887 holdings it had in June 2023 when Wellington first joined. The quant-driven strategies (Los Angeles Capital and D.E. Shaw) typically run broad portfolios and are most responsible for the high number of stocks.

The strategy’s strength lies in its lineup of managers, supporting an Above Average People rating.

D.E. Shaw’s sleeve of this portfolio is in good hands after a recent manager departure. In February 2025, manager Ruvim Breydo left the firm. Breydo had been a manager here since 2022 and had more than three decades of experience. Following his departure, D.E. Shaw appointed Max Stone and Konstantin Turitsyn as replacements. They are fully capable. Stone has worked in investment management since 1994 and Turitsyn since 2018, and the strategy’s quant approach transcends the input of any single manager. Plus, the pair still has the support of the firm’s more than 150-member research team.

Veteran investor and Los Angeles Capital cofounder Hal Reynolds leads the firm's sleeve with Kristin Ceglar. Reynolds has more than four decades of investment experience, nearly half of it at Los Angeles Capital. Ceglar, who joined the firm in 2005, brings more than 15 years of portfolio-management expertise. The overall team remains deep, experienced, and well-equipped to support the strategy, which is also quantitative in nature.

Wellington, the sole fundamentally focused manager, brings a strong pedigree in stock investing. Nine sector-focused analysts, who average nearly 25 years of industry experience, have buy-and-sell authority over their respective sectors. The group supports listed manager Mary Pryshlak, who provides portfolio-level oversight and risk management. She also rebalances Wellington’s portion of the portfolio.

Vanguard maintains its High Parent Pillar rating as it continues to grow under new leadership.

CEO Salim Ramji has had a busy first year captaining Vanguard’s crew, and the ship remains pointed in the right direction. The firm made its largest round of fee cuts in early 2025, which came at an estimated cost of USD 350 million. It established a separate division dedicated to its advice and wealth management efforts, a sign that it wants to seriously compete within those lines of business. Asset growth has continued to be a huge success. Only BlackRock’s inflows rival the money Vanguard is taking in. Likewise, the number of clients it serves has more than doubled since 2015.

Despite that success, an ever-growing number of clients has presented a challenge: Vanguard can’t grow its services fast enough to keep up with demand. In some instances, it has had to curb certain services and capabilities or raise fees on others to cope, causing some loyal clients to criticize what they perceive as deteriorating services.

Vanguard has ambitions to bring its disruptive legacy to the bond market. It created roughly a dozen low-cost bond exchange-traded funds for US investors and several others abroad over the 12 months through June 2025. All have low fees in their respective categories, and the actively managed strategies align with Vanguard’s philosophy. They are relatively easy to understand and are conservatively managed.

Vanguard has another opportunity to prove that clients are still its priority. On the surface, its endeavor into the high-fee deal-making world of private assets alongside Wellington and Blackstone looks like a cultural mismatch. So far, the collaboration hasn’t produced anything that’s concerning.

This fund may not reliably beat the market, but it has a strong track record of beating those who try to. The fund’s current three-subadvisor lineup formed in August 2023, and from that date through May 2026, the investor share class gained 21.4% annualized. That topped the typical large-blend category peer and the S&P 500 prospectus benchmark by 3.4 and 0.3 percentage points, respectively. It earned a Morningstar Risk-Adjusted Return of 13.9%, versus 10.9% and 13.6% for its typical rival and the index, respectively.

More recent results are consistent with that pattern. The fund's 29.5% return over the trailing 12 months through May 2026 matched the index and beat the typical peer's 25.5%. Stock selection drove results, with modest overweightings in Broadcom, Micron Technology, and TSM benefiting from strong demand across the semiconductor supply chain.

The longer-term record follows suit. Over the trailing five years through May 2026, the fund returned 14.1% annualized versus 14.2% for the S&P 500 and 11.5% for the typical large-blend peer. Over 10 years, it returned 15.4% annualized, versus 15.6% for the index and 13.3% for the peer. Given its benchmarklike portfolio, this fund is unlikely to vastly outperform the index, but it remains a good bet to come ahead of the average peer.

Vanguard Growth & Income Adm's Prospectus Adjusted Expense Ratio is 0.28% per year. It places it in the cheapest quintile of the Morningstar US Fund Large Blend Category, where the median fee is 0.67% per year. This cost positioning translates into a Medalist Rating Price Score of 1.51, which reflects its relative price positioning within the category. The Price Score ranges from -2.50 (most expensive) to +2.50 (cheapest), with higher scores indicating better cost competitiveness.