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Is Vanguard Mid-Cap Index Admiral (VIMAX) a Strong Mutual Fund Pick Right Now?

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Are you on the hunt for a Mutual Fund Equity Report fund? You should think about starting with Vanguard Mid-Cap Index Admiral (VIMAX - 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 responsible for VIMAX, and the company is based out of Malvern, PA. The Vanguard Mid-Cap Index Admiral made its debut in November of 2001 and VIMAX has managed to accumulate roughly $53.78 billion in assets, as of the most recently available information. Donald Butler is the fund's current manager and has held that role since November of 2001.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 8.35%, and is in the top 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 11.36%, 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. The standard deviation of VIMAX over the past three years is 23.4% compared to the category average of 19.1%. Looking at the past 5 years, the fund's standard deviation is 20.82% compared to the category average of 16.69%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 1.08, 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. VIMAX has generated a negative alpha over the past five years of -1.65, 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 principally on equities that are traded in the United States.

As of the last filing date, the mutual fund has 92.43% of its assets in stocks, which have an average market capitalization of $24.75 billion. The fund has the heaviest exposure to the following market sectors:

  • Finance
  • Technology
  • Industrial Cyclical
This fund's turnover is about 12%, so the fund managers are making fewer trades than its comparable peers.

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, VIMAX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.78%. From a cost perspective, VIMAX is actually cheaper than its peers.

While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to be at least $1.

Bottom Line

Your research on the Mutual Fund Equity Report segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer 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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