In spite of their strong records, two Vanguard funds that have been suffering steep redemptions will now be reopened to investors—and industry observers say this is an indication of investors’ skittishness in this weak economy.


The $10.2 billion Vanguard Explorer Fund, closed in February 2006, and the $22.2 billion Vanguard Health Care Fund, closed in March 2005, are now reopened.


“We believe that the funds can accommodate additional assets at this time, given their current size and cash flow levels,” said Vanguard Chairman and CEO John J. Brennan.


“The market is down, small caps have been underperforming and healthcare stocks are struggling,” Dan Newhall, a principal in the portfolio review group at Vanguard told “We want to offset redemptions.”


Four Vanguard funds remain closed: the Vanguard PRIMECAP, Vanguard Capital Opportunity, Vanguard Precious Metals and Mining and the Vanguard International Explorer funds.

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