Vanguard Group was able to stand out this year despite – or perhaps because of – a difficult market environment.

In 2009, the Malvern, Pa., fund giant significantly increased its assets under management, introduced products and expanded distribution internationally, according to William McNabb, the company’s chairman and chief executive officer.

“This downturn was devastating on a lot of fronts, but we were pretty well-positioned and were able to anticipate at least some of it,” he said in an interview last week. “We found ourselves in a good position to deal with the bumpy environment.”

Vanguard’s plan to stay on top in 2010 is to continue to introduce products. Last week, it announced it plans to enhance its array of actively-managed funds by launching a pair of products – a small-cap value and a mid-cap value product. McNabb said the funds were filed with the Securities and Exchange Commission and he expects they will be available in “February or maybe March.” “It was a hole in our lineup and we think this was a good opportunity to fill that hole,” he said. “We really continue undaunted. We are always looking to add things where we perceive an opportunity regardless of market conditions.”

Vanguard also plans to introduce more exchange-traded funds in 2010, McNabb said. Exchange-traded funds accounted for $25 billion of the company’s $93 billion in total inflows through Nov. 30.

“ETFs are not really a separate thing for us,” McNabb said. “We see this as another way to index and … an opportunity to take the low-cost diversified story to another audience. ETFs are one of the big trends in the investment business right now and a story that is finding wider and wider appeal.”

The company also plans to continue to increase its distribution globally, McNabb said. Currently, less than 10% of the company’s assets are held outside of the United States. McNabb said he won’t set a goal for growth of its international business, but the company plans to introduce more international products to add assets, including potentially some new ETFs in Australia.

Vanguard has also developed some of the “less sexy” areas of its business connected to asset management, including its servicing side and its Web site, McNabb said.

“We have to continue to enhance and evolve some of our hidden strengths,” he said. “I guess the Web site is not so hidden, considering we have hundreds of thousands of log-ons daily, but we wanted to make a huge investment in it this year so we can continue to generate that kind of traffic next year.”

McNabb said Vanguard also continues to emphasize communications, particularly through online channels including its virtual town hall meetings. “We want to continue to find ways to educate and communicate,” he said. “We really believe that we can never over communicate. These types of things are helping get people through volatile times.”

Geoffrey Bobroff of Bobroff Consulting in East Greenwich, R.I., said traditionally, after a decade in which equity investing slump, the sector will rally, but if Vanguard continues to invest in its actively managed products and its 401(k) business it can profit from any market environment.

McNabb, who in November became only the third chairman in Vanguard’s 35 year history, said not only has the company introduced new exchange-traded funds and a series of bond funds in the past year, but it has also opened an office in the United Kingdom and a series of international funds.

“I think one lesson that has been reinforced during the crisis is that boring works,” he said. “It is not terribly sexy to talk about low-cost diversification and a balanced approach, but those kinds of portfolios have held up the best and those principles have been reinforced more than any other time in my career. It doesn’t generate a lot of chatter at a cocktail party, but we are profiting from those principles in spite of the environment.”

Vanguard has increased its assets under management 30% to $1.3 trillion in the past year. It has attracted $93 billion in new assets in the first 11 months of this year for its second strongest year of inflows in the company’s history. In 2007, it brought in $104 billion in assets. According to Morningstar Inc., this marks the third consecutive years that Vanguard has led the fund industry in net inflows.