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Is Vanguard Extended Market Index Institutional (VIEIX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Small Cap Blend funds, a place to start could be Vanguard Extended Market Index Institutional (VIEIX - Free Report) . VIEIX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VIEIX is one of many Small Cap Blend funds to choose from. Small Cap Blend mutual funds allow investors a way to diversify their funds among various types of small-cap stocks. These funds seek companies with market capitalization of less than $2 billion, and aid in reducing volatility inherent in lower market cap stocks.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VIEIX. Vanguard Extended Market Index Institutional made its debut in July of 1997, and since then, VIEIX has accumulated about $17.48 billion in assets, per the most up-to-date date available. The fund's current manager, Donald Butler, has been in charge of the fund since November of 2000.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 13.54%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 12.88%, which places it in the top 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. The standard deviation of VIEIX over the past three years is 25.22% compared to the category average of 15.28%. Over the past 5 years, the standard deviation of the fund is 20.89% compared to the category average of 13.01%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.29, the fund is likely to be more volatile than the market average. 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. The fund has produced a negative alpha over the past 5 years of -3.17, 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 largely on equities that are traded in the United States.
Currently, this mutual fund is holding 93.11% stock in stocks, with an average market capitalization of $36.91 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Retail Trade
Other
This fund's turnover is about 10%, so the fund managers are 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, VIEIX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.98%. So, VIEIX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $5 million, and each subsequent investment should be at least $1.
Bottom Line
Overall, Vanguard Extended Market Index Institutional ( VIEIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Vanguard Extended Market Index Institutional ( VIEIX ) looks like a good potential choice for investors right now.
This could just be the start of your research on VIEIXin the Small Cap Blend category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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 Extended Market Index Institutional (VIEIX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Small Cap Blend funds, a place to start could be Vanguard Extended Market Index Institutional (VIEIX - Free Report) . VIEIX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VIEIX is one of many Small Cap Blend funds to choose from. Small Cap Blend mutual funds allow investors a way to diversify their funds among various types of small-cap stocks. These funds seek companies with market capitalization of less than $2 billion, and aid in reducing volatility inherent in lower market cap stocks.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VIEIX. Vanguard Extended Market Index Institutional made its debut in July of 1997, and since then, VIEIX has accumulated about $17.48 billion in assets, per the most up-to-date date available. The fund's current manager, Donald Butler, has been in charge of the fund since November of 2000.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 13.54%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 12.88%, which places it in the top 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. The standard deviation of VIEIX over the past three years is 25.22% compared to the category average of 15.28%. Over the past 5 years, the standard deviation of the fund is 20.89% compared to the category average of 13.01%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.29, the fund is likely to be more volatile than the market average. 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. The fund has produced a negative alpha over the past 5 years of -3.17, 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 largely on equities that are traded in the United States.
Currently, this mutual fund is holding 93.11% stock in stocks, with an average market capitalization of $36.91 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
- Retail Trade
- Other
This fund's turnover is about 10%, so the fund managers are 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, VIEIX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.98%. So, VIEIX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $5 million, and each subsequent investment should be at least $1.
Bottom Line
Overall, Vanguard Extended Market Index Institutional ( VIEIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Vanguard Extended Market Index Institutional ( VIEIX ) looks like a good potential choice for investors right now.
This could just be the start of your research on VIEIXin the Small Cap Blend category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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.