Having trouble finding a Sector - Energy fund? Vanguard Energy Investor (VGENX Quick QuoteVGENX - Free Report) is a possible starting point. VGENX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

VGENX is one of many Sector - Energy funds to choose from. Sector - Energy mutual funds are comprised of various changing and hugely important industries throughout the massive global energy sector. Even though clean energy is beginning to pick up steam, oil and gas companies have the highest exposure, but carbon-based fuels will be the biggest group of assets in these funds.

History of Fund/Manager

Vanguard Group is based in Malvern, PA, and is the manager of VGENX. Vanguard Energy Investor made its debut in May of 1984, and since then, VGENX has accumulated about $1.35 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of -2.31%, 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 -13.44%, 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. The standard deviation of VGENX over the past three years is 27.92% compared to the category average of 28.7%. Looking at the past 5 years, the fund's standard deviation is 23.82% compared to the category average of 24.33%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.25, so investors should note that it is hypothetically more volatile than the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. VGENX has generated a negative alpha over the past five years of -16.91, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

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, VGENX is a no load fund. It has an expense ratio of 0.35% compared to the category average of 1.53%. Looking at the fund from a cost perspective, VGENX 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.

Bottom Line

Overall, Vanguard Energy Investor ( VGENX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

For additional information on the Sector - Energy 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 VGENX too 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.