There are plenty of choices in the Target Date category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard Target Retirement 2015 Fund . While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
Vanguard Group is responsible for VTXVX, and the company is based out of Malvern, PA. The Vanguard Target Retirement 2015 Fund made its debut in October of 2003 and VTXVX has managed to accumulate roughly $15.84 billion in assets, as of the most recently available information. The fund's current manager, William A. Coleman, has been in charge of the fund since February of 2013.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 5.6%, and is 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 7.5%, 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. VTXVX's standard deviation over the past three years is 4.59% compared to the category average of -43.9%. Looking at the past 5 years, the fund's standard deviation is 5.07% compared to the category average of 0.09%. This makes the fund more 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 VTXVX's case, the fund lost 34.99% in the most recent bear market and outperformed its peer group by 26%. This makes the fund a possibly better choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 0.39, so it is likely going to be less 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. With a positive alpha of 0.36, managers in this portfolio are skilled in picking 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, VTXVX is a no load fund. It has an expense ratio of 0.10% compared to the category average of -34.99%. So, VTXVX is actually more expensive than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $1.
Bottom Line
For additional information on the Target Date 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 VTXVX 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.
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Is Vanguard Target Retirement 2015 Fund (VTXVX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Target Date category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard Target Retirement 2015 Fund . While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
Vanguard Group is responsible for VTXVX, and the company is based out of Malvern, PA. The Vanguard Target Retirement 2015 Fund made its debut in October of 2003 and VTXVX has managed to accumulate roughly $15.84 billion in assets, as of the most recently available information. The fund's current manager, William A. Coleman, has been in charge of the fund since February of 2013.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 5.6%, and is 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 7.5%, 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. VTXVX's standard deviation over the past three years is 4.59% compared to the category average of -43.9%. Looking at the past 5 years, the fund's standard deviation is 5.07% compared to the category average of 0.09%. This makes the fund more 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 VTXVX's case, the fund lost 34.99% in the most recent bear market and outperformed its peer group by 26%. This makes the fund a possibly better choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 0.39, so it is likely going to be less 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. With a positive alpha of 0.36, managers in this portfolio are skilled in picking 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, VTXVX is a no load fund. It has an expense ratio of 0.10% compared to the category average of -34.99%. So, VTXVX is actually more expensive than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $1.
Bottom Line
For additional information on the Target Date 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 VTXVX 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.