There are plenty of choices in the Mutual Fund Equity Report category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard Value Index Admiral (VVIAX). The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
History of Fund/Manager
VVIAX finds itself in the Vanguard Group family, based out of Malvern, PA. The Vanguard Value Index Admiral made its debut in November of 2000 and VVIAX has managed to accumulate roughly $31.30 billion in assets, as of the most recently available information. Gerard O’Reilly is the fund’s current manager and has held that role since November of 2000.
Obviously, what investors are looking for in these funds is strong performance relative to their peers. VVIAX has a 5-year annualized total return of 10.93% and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 11%, which places it in the top third during this time-frame.
When looking at a fund’s performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, VVIAX’s standard deviation comes in at 18.47%, compared to the category average of 16.67%. The standard deviation of the fund over the past 5 years is 16.11% compared to the category average of 14.6%. This makes the fund more volatile than its peers over the past half-decade.
The fund has a 5-year beta of 0.92, so investors should note that it is hypothetically less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio’s performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a negative alpha over the past 5 years of -1.41, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is mostly on equities that are traded in the United States.
The mutual fund currently has 90.31% of its holdings in stocks, which have an average market capitalization of $158.98 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 9%, this fund is making fewer trades than comparable funds.
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, VVIAX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.99%. Looking at the fund from a cost perspective, VVIAX is actually cheaper than its peers.
While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to be at least $1.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VVIAX too for additional information. And don’t forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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