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Is Vanguard Mid-Cap Growth Index Admiral (VMGMX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Index category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard Mid-Cap Growth Index Admiral (VMGMX - Free Report) . 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 based in Malvern, PA, and is the manager of VMGMX. Vanguard Mid-Cap Growth Index Admiral debuted in September of 2011. Since then, VMGMX has accumulated assets of about $11.40 billion, according to the most recently available information. The fund's current manager, Donald Butler, has been in charge of the fund since February of 2013.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 17.8%, and it sits 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 19.75%, 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. VMGMX's standard deviation over the past three years is 21.22% compared to the category average of 15.86%. Over the past 5 years, the standard deviation of the fund is 17.08% compared to the category average of 13.19%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.07, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a negative alpha over the past 5 years of -0.19, which shows that managers in this portfolio find it difficult to pick 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, VMGMX is a no load fund. It has an expense ratio of 0.07% compared to the category average of 0.79%. VMGMX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $3,000; each subsequent investment needs to be at least $1.
Bottom Line
Don't stop here for your research on Index 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 VMGMX 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 Mid-Cap Growth Index Admiral (VMGMX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Index category, but where should you start your research? Well, one fund that might be worth investigating is Vanguard Mid-Cap Growth Index Admiral (VMGMX - Free Report) . 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 based in Malvern, PA, and is the manager of VMGMX. Vanguard Mid-Cap Growth Index Admiral debuted in September of 2011. Since then, VMGMX has accumulated assets of about $11.40 billion, according to the most recently available information. The fund's current manager, Donald Butler, has been in charge of the fund since February of 2013.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 17.8%, and it sits 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 19.75%, 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. VMGMX's standard deviation over the past three years is 21.22% compared to the category average of 15.86%. Over the past 5 years, the standard deviation of the fund is 17.08% compared to the category average of 13.19%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.07, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a negative alpha over the past 5 years of -0.19, which shows that managers in this portfolio find it difficult to pick 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, VMGMX is a no load fund. It has an expense ratio of 0.07% compared to the category average of 0.79%. VMGMX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $3,000; each subsequent investment needs to be at least $1.
Bottom Line
Don't stop here for your research on Index 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 VMGMX 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.