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Is Vanguard Small-Cap Index Investor (NAESX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Index funds, consider Vanguard Small-Cap Index Investor (NAESX - Free Report) as a possibility. 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
Vanguard Group is responsible for NAESX, and the company is based out of Malvern, PA. The Vanguard Small-Cap Index Investor made its debut in March of 1975 and NAESX has managed to accumulate roughly $498.12 million in assets, as of the most recently available information. The fund is currently managed by William Coleman who has been in charge of the fund since April of 2016.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 3.43%, and is in the bottom 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 0.83%, 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. NAESX's standard deviation over the past three years is 22.22% compared to the category average of 12.95%. The standard deviation of the fund over the past 5 years is 19.19% compared to the category average of 11.87%. 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 NAESX's case, the fund lost 53.25% in the most recent bear market and underperformed comparable funds by 10%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 1.22, 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. NAESX has generated a negative alpha over the past five years of -6.33, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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 largely on equities that are traded in the United States.
Currently, this mutual fund is holding 80.88% stock in stocks, with an average market capitalization of $5.15 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
Industrial Cyclical
Other
With turnover at about 16%, this fund is making fewer trades than its comparable peers.
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, NAESX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.84%. From a cost perspective, NAESX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Want even more information about NAESX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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 Small-Cap Index Investor (NAESX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Index funds, consider Vanguard Small-Cap Index Investor (NAESX - Free Report) as a possibility. 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
Vanguard Group is responsible for NAESX, and the company is based out of Malvern, PA. The Vanguard Small-Cap Index Investor made its debut in March of 1975 and NAESX has managed to accumulate roughly $498.12 million in assets, as of the most recently available information. The fund is currently managed by William Coleman who has been in charge of the fund since April of 2016.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 3.43%, and is in the bottom 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 0.83%, 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. NAESX's standard deviation over the past three years is 22.22% compared to the category average of 12.95%. The standard deviation of the fund over the past 5 years is 19.19% compared to the category average of 11.87%. 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 NAESX's case, the fund lost 53.25% in the most recent bear market and underperformed comparable funds by 10%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 1.22, 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. NAESX has generated a negative alpha over the past five years of -6.33, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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 largely on equities that are traded in the United States.
Currently, this mutual fund is holding 80.88% stock in stocks, with an average market capitalization of $5.15 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Technology
- Industrial Cyclical
- Other
With turnover at about 16%, this fund is making fewer trades than its comparable peers.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, NAESX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.84%. From a cost perspective, NAESX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Want even more information about NAESX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.