May 27, 2004 — Vanguard Precious Metals Fund (VGPMX) will reopen to new investors on Friday after being closed for two years, the Vanguard Group said.

The company also announced it plans to change the investment policies of four corporate-bond funds to permit them to invest in a broader range of investment-grade fixed-income securities, including U.S. Treasury and agency bonds, and mortgage-backed securities.

In addition, Vanguard raised the minimum initial investment for Vanguard Energy (VGENX) to $25,000 from $3,000 to stem the amount of cash flowing into the fund. The fund’s assets have more than doubled over the past year to $3.3 billion, Vanguard said.

The Precious Metals Fund will reopen as the Precious Metals and Mining Fund. The new name reflects the fund’s ability to invest in a wider range of companies, Vanguard said. The newly reopened fund will require a minimum initial investment of $10,000.

The new investment mandates, which the funds are expected to adopt in late July, apply to Vanguard Short Term Corp. (VFSTX), Vanguard Intm Term Corporate (VFICX), and Vanguard Long Term Corp. (VWESX), and to a variable annuity product, Vanguard Variable Insurance Fund Short-Term Corporate Portfolio.

Currently, the funds are required to invest at least 80% of their assets in investment-grade corporate bonds. Under the new mandate, Vanguard said, the funds are expected to continue to invest predominately in high-quality corporate bonds. The funds will also be renamed to reflect their new investment policies.

Vanguard also eliminated a requirement limiting the energy fund’s investments in foreign stocks to 50% of its assets. The change will enable the fund’s investment advisor, Wellington Management Co., to “better adapt to the globalization of the energy industry,” Vanguard said.

Contact Robert F. Keane with questions or comments at:

bkeane@ia-mag.com.