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Is Vanguard FTSE All-World ex-US Index Admiral (VFWAX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Index category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard FTSE All-World ex-US Index Admiral (VFWAX - Free Report) . 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
VFWAX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard FTSE All-World ex-US Index Admiral made its debut in September of 2011, and since then, VFWAX has accumulated about $8.79 billion in assets, per the most up-to-date date available. The fund's current manager, Justin Hales, has been in charge of the fund since February of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. VFWAX has a 5-year annualized total return of 11.16% and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 9.8%, 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 17.79% compared to the category average of 15.56%. Looking at the past 5 years, the fund's standard deviation is 14.71% compared to the category average of 12.94%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VFWAX has a 5-year beta of 0.85, which means it is likely to be less volatile than the market average. 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 -3.29, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key 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 0.79%. 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
For additional information on this product, or to compare it to other mutual funds in the Index, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is Vanguard FTSE All-World ex-US Index Admiral (VFWAX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Index category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard FTSE All-World ex-US Index Admiral (VFWAX - Free Report) . 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
VFWAX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard FTSE All-World ex-US Index Admiral made its debut in September of 2011, and since then, VFWAX has accumulated about $8.79 billion in assets, per the most up-to-date date available. The fund's current manager, Justin Hales, has been in charge of the fund since February of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. VFWAX has a 5-year annualized total return of 11.16% and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 9.8%, 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 17.79% compared to the category average of 15.56%. Looking at the past 5 years, the fund's standard deviation is 14.71% compared to the category average of 12.94%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VFWAX has a 5-year beta of 0.85, which means it is likely to be less volatile than the market average. 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 -3.29, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key 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 0.79%. 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
For additional information on this product, or to compare it to other mutual funds in the Index, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.