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Investment Grade Bond - Intermediate fund seekers should not consider taking a look at Vanguard Intermediate-Term Investment-Grade Admiral (VFIDX - Free Report) at this time. VFIDX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify VFIDX in the Investment Grade Bond - Intermediate category, an area rife with potential choices. Investment Grade Bond - Intermediate funds target the middle part of the curve, typically by investing in bonds that mature in more than three years but less than 15 years. At these maturity levels, fixed income instruments have medium duration risk--but they compensate investors with a respectable yield compared to shorter maturity options. Finally, a focus on investment grade ensures that these funds are safer, but yields will be lower than in the junk bond category.
History of Fund/Manager
Vanguard Group is responsible for VFIDX, and the company is based out of Malvern, PA. Vanguard Intermediate-Term Investment-Grade Admiral debuted in February of 2001. Since then, VFIDX has accumulated assets of about $33.85 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 4.05%, and is in the middle 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 6.76%, 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 VFIDX over the past three years is 4.59% compared to the category average of 10.98%. Looking at the past 5 years, the fund's standard deviation is 4.14% compared to the category average of 9.11%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 1.1, meaning that it is more volatile than a broad market index of fixed income securities. Taking this into account, VFIDX has a positive alpha of 0.65, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, VFIDX has 23.68% in high quality bonds rated at least 'AA' or higher, while 73.67% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, VFIDX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 0.79%. From a cost perspective, VFIDX is actually cheaper than its peers.
This fund requires a minimum initial investment of $50,000, and each subsequent investment should be at least $1.
Bottom Line
Overall, Vanguard Intermediate-Term Investment-Grade Admiral ( VFIDX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Vanguard Intermediate-Term Investment-Grade Admiral ( VFIDX ) looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Investment Grade Bond - Intermediate 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 VFIDX to its peers as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is VFIDX a Strong Bond Fund Right Now?
Investment Grade Bond - Intermediate fund seekers should not consider taking a look at Vanguard Intermediate-Term Investment-Grade Admiral (VFIDX - Free Report) at this time. VFIDX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify VFIDX in the Investment Grade Bond - Intermediate category, an area rife with potential choices. Investment Grade Bond - Intermediate funds target the middle part of the curve, typically by investing in bonds that mature in more than three years but less than 15 years. At these maturity levels, fixed income instruments have medium duration risk--but they compensate investors with a respectable yield compared to shorter maturity options. Finally, a focus on investment grade ensures that these funds are safer, but yields will be lower than in the junk bond category.
History of Fund/Manager
Vanguard Group is responsible for VFIDX, and the company is based out of Malvern, PA. Vanguard Intermediate-Term Investment-Grade Admiral debuted in February of 2001. Since then, VFIDX has accumulated assets of about $33.85 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 4.05%, and is in the middle 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 6.76%, 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 VFIDX over the past three years is 4.59% compared to the category average of 10.98%. Looking at the past 5 years, the fund's standard deviation is 4.14% compared to the category average of 9.11%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 1.1, meaning that it is more volatile than a broad market index of fixed income securities. Taking this into account, VFIDX has a positive alpha of 0.65, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, VFIDX has 23.68% in high quality bonds rated at least 'AA' or higher, while 73.67% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, VFIDX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 0.79%. From a cost perspective, VFIDX is actually cheaper than its peers.
This fund requires a minimum initial investment of $50,000, and each subsequent investment should be at least $1.
Bottom Line
Overall, Vanguard Intermediate-Term Investment-Grade Admiral ( VFIDX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Vanguard Intermediate-Term Investment-Grade Admiral ( VFIDX ) looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Investment Grade Bond - Intermediate 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 VFIDX to its peers as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.