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Is Vanguard Strategic Equity Fund (VSEQX) a Strong Mutual Fund Pick Right Now?
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Mutual Fund Equity Report fund seekers should consider taking a look at Vanguard Strategic Equity Fund (VSEQX - Free Report) . VSEQX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VSEQX. Vanguard Strategic Equity Fund debuted in August of 1995. Since then, VSEQX has accumulated assets of about $7.71 billion, according to the most recently available information. The fund's current manager, Cesar Orosco, has been in charge of the fund since February of 2021.
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 8.86%, and it sits in the top 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 17.21%, which places it in the top third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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 VSEQX over the past three years is 20% compared to the category average of 19.48%. Over the past 5 years, the standard deviation of the fund is 23.37% compared to the category average of 21.91%. 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 1.15, so it is likely going to be more 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 -3.73, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
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.
Right now, 95% of this mutual fund's holdings are stocks and it has a negligible amount of assets in foreign securities. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
Industrial Cyclical
Turnover is 52%, which means, on average, the fund makes more trades per year than the comparable average.
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, VSEQX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.96%. So, VSEQX 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.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Strategic Equity Fund ( VSEQX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds 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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Is Vanguard Strategic Equity Fund (VSEQX) a Strong Mutual Fund Pick Right Now?
Mutual Fund Equity Report fund seekers should consider taking a look at Vanguard Strategic Equity Fund (VSEQX - Free Report) . VSEQX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VSEQX. Vanguard Strategic Equity Fund debuted in August of 1995. Since then, VSEQX has accumulated assets of about $7.71 billion, according to the most recently available information. The fund's current manager, Cesar Orosco, has been in charge of the fund since February of 2021.
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 8.86%, and it sits in the top 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 17.21%, which places it in the top third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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 VSEQX over the past three years is 20% compared to the category average of 19.48%. Over the past 5 years, the standard deviation of the fund is 23.37% compared to the category average of 21.91%. 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 1.15, so it is likely going to be more 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 -3.73, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
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.
Right now, 95% of this mutual fund's holdings are stocks and it has a negligible amount of assets in foreign securities. The fund has the heaviest exposure to the following market sectors:
- Finance
- Technology
- Industrial Cyclical
Turnover is 52%, which means, on average, the fund makes more trades per year than the comparable average.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, VSEQX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.96%. So, VSEQX 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.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Strategic Equity Fund ( VSEQX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds 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.