We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Vanguard FTSE All-World ex-US Index Admiral (VFWAX) a Strong Mutual Fund Pick Right Now?
Read MoreHide Full Article
If investors are looking at the Index fund category, Vanguard FTSE All-World ex-US Index Admiral (VFWAX - Free Report) could be a potential option. VFWAX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
VFWAX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard FTSE All-World ex-US Index Admiral debuted in September of 2011. Since then, VFWAX has accumulated assets of about $7.99 billion, according to the most recently available information. The fund's current manager, Justin Hales, has been in charge of the fund since February of 2016.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 9.18%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.22%, which places it in the bottom 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. VFWAX's standard deviation over the past three years is 18.39% compared to the category average of 15.53%. Over the past 5 years, the standard deviation of the fund is 15.39% compared to the category average of 13.23%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.89, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. VFWAX has generated a negative alpha over the past five years of -3.75, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, VFWAX is a no load fund. It has an expense ratio of 0.11% compared to the category average of 0.81%. So, VFWAX is actually cheaper than its peers from a cost perspective.
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.
Bottom Line
Overall, Vanguard FTSE All-World ex-US Index Admiral ( VFWAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.
This could just be the start of your research on VFWAXin the Index category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is Vanguard FTSE All-World ex-US Index Admiral (VFWAX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Index fund category, Vanguard FTSE All-World ex-US Index Admiral (VFWAX - Free Report) could be a potential option. VFWAX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
VFWAX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard FTSE All-World ex-US Index Admiral debuted in September of 2011. Since then, VFWAX has accumulated assets of about $7.99 billion, according to the most recently available information. The fund's current manager, Justin Hales, has been in charge of the fund since February of 2016.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 9.18%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.22%, which places it in the bottom 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. VFWAX's standard deviation over the past three years is 18.39% compared to the category average of 15.53%. Over the past 5 years, the standard deviation of the fund is 15.39% compared to the category average of 13.23%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.89, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. VFWAX has generated a negative alpha over the past five years of -3.75, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, VFWAX is a no load fund. It has an expense ratio of 0.11% compared to the category average of 0.81%. So, VFWAX is actually cheaper than its peers from a cost perspective.
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.
Bottom Line
Overall, Vanguard FTSE All-World ex-US Index Admiral ( VFWAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.
This could just be the start of your research on VFWAXin the Index category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.