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Is VTIPX a Strong Bond Fund Right Now?

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Investors in search of a Mutual Fund Bond fund might want to consider looking at Vanguard Short Term Inflation Protected Security Index Iv (VTIPX - Free Report) . 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 based in Malvern, PA, and is the manager of VTIPX. The Vanguard Short Term Inflation Protected Security Index Iv made its debut in October of 2012 and VTIPX has managed to accumulate roughly $7.85 billion in assets, as of the most recently available information. The fund's current manager, Joshua Barrickman, has been in charge of the fund since October of 2012.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 3.02%, and it sits in the middle 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 4.83%, which places it in the middle 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. Compared to the category average of 11.55%, the standard deviation of VTIPX over the past three years is 1.82%. The standard deviation of the fund over the past 5 years is 1.68% compared to the category average of 9.65%. This makes the fund less volatile than its peers over the past half-decade.

VTIPX carries a beta of 0.17, meaning that the fund is less volatile than a broad market index of fixed income securities. With this in mind, it has a positive alpha of 1.43, which measures performance on a risk-adjusted basis.

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, VTIPX is a no load fund. It has an expense ratio of 0.14% compared to the category average of 0.65%. Looking at the fund from a cost perspective, VTIPX is actually cheaper than its peers.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Bond, make sure to go to www.zacks.com/funds/mutual-funds 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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