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Is Vanguard Consumer Staples Index Admiral (VCSAX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Large Cap Blend funds, consider Vanguard Consumer Staples Index Admiral (VCSAX - Free Report) as a possibility. VCSAX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that VCSAX is a Large Cap Blend option, an area loaded with different options. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a " buy and hold " mindset. Additionally, blended funds mix large, more established firms into their portfolios, giving investors exposure to value and growth opportunities.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VCSAX. The Vanguard Consumer Staples Index Admiral made its debut in January of 2004 and VCSAX has managed to accumulate roughly $596.42 million in assets, as of the most recently available information. The fund is currently managed by Michael A. Johnson who has been in charge of the fund since December of 2010.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 8.25%, 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 6.18%, 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. Over the past three years, VCSAX's standard deviation comes in at 9.42%, compared to the category average of 10.58%. Over the past 5 years, the standard deviation of the fund is 10.02% compared to the category average of 10.32%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In VCSAX's case, the fund lost 27.95% in the most recent bear market and underperformed its peer group by 21.72%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VCSAX has a 5-year beta of 0.59, 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 positive alpha over the past 5 years of 1.62, which shows that managers in this portfolio are skilled in picking 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, VCSAX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1%. Looking at the fund from a cost perspective, VCSAX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $1.
Bottom Line
Overall, Vanguard Consumer Staples Index Admiral ( VCSAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Vanguard Consumer Staples Index Admiral ( VCSAX ) looks like a great potential choice for investors right now.
Don't stop here for your research on Large Cap Blend funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare VCSAX to its peers as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is Vanguard Consumer Staples Index Admiral (VCSAX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Large Cap Blend funds, consider Vanguard Consumer Staples Index Admiral (VCSAX - Free Report) as a possibility. VCSAX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that VCSAX is a Large Cap Blend option, an area loaded with different options. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a " buy and hold " mindset. Additionally, blended funds mix large, more established firms into their portfolios, giving investors exposure to value and growth opportunities.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VCSAX. The Vanguard Consumer Staples Index Admiral made its debut in January of 2004 and VCSAX has managed to accumulate roughly $596.42 million in assets, as of the most recently available information. The fund is currently managed by Michael A. Johnson who has been in charge of the fund since December of 2010.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 8.25%, 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 6.18%, 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. Over the past three years, VCSAX's standard deviation comes in at 9.42%, compared to the category average of 10.58%. Over the past 5 years, the standard deviation of the fund is 10.02% compared to the category average of 10.32%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In VCSAX's case, the fund lost 27.95% in the most recent bear market and underperformed its peer group by 21.72%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VCSAX has a 5-year beta of 0.59, 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 positive alpha over the past 5 years of 1.62, which shows that managers in this portfolio are skilled in picking 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, VCSAX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1%. Looking at the fund from a cost perspective, VCSAX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $1.
Bottom Line
Overall, Vanguard Consumer Staples Index Admiral ( VCSAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Vanguard Consumer Staples Index Admiral ( VCSAX ) looks like a great potential choice for investors right now.
Don't stop here for your research on Large Cap Blend funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare VCSAX to its peers as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.