Vanguard is a major worldwide investment management firm that provides a diverse selection of mutual funds to assist clients in meeting their financial objectives.

 

Vanguard mutual funds are designed to provide investors with access to a wide range of investments at a lower cost than traditional mutual funds. This means that investors can save on fees and taxes while still getting the same quality of portfolio management as they would with a more expensive fund.

 

According to Morningstar, its average expense ratio in 2020 was just 0.09%, making it one of the most cost-effective options for investors. With a wide range of mutual funds available, investors can diversify their portfolios across different asset classes and sectors. Moreover, these funds offer long-term capital appreciation with minimal risk compared to other funds. 

 

This, Vanguard mutual funds have become natural choices for investors given the current gloomy investment scenario. The stock market continues to gyrate on fears of an imminent bank credit crunch-led recession, while a growing wave of weak economic data has deepened worries that the Federal Reserve’s rapid interest rate hike might tip the U.S. economy into a recession.

 

According to the most recent data from the U.S. Bureau of Economic Analysis, consumer spending fell 0.2% in February, which led to a slowdown in economic growth. Investors are growing more worried about how a possible recession would affect their portfolios.

 

Meanwhile, ADP's latest National Employment Report showed that employment in the private sector increased by 145,000 in March, way less than February’s private payroll increase of 242,000, driving the fear of an imminent recession to a new high. The stock market has been responding to this news with wild gyrations, leaving many investors and business owners uncertain about the future of the economy.  Many companies have had to cut back their workforce to stay afloat, while others are struggling to find enough customers or clients.

 

Nonetheless, investing in low-cost Vanguard mutual funds seems to be judicious as of now. Also, mutual funds, in general, diversify portfolios without several commission charges that are mainly associated with stock purchases and trim transaction costs (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

 

We have, thus, chosen three Vanguard mutual funds that investors should buy now for the long term. These funds possess a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy), have positive three-year and five-year annualized returns, minimum initial investments within $5000, and expense ratios considerably lower than the category average. So, these funds have provided comparatively strong performance along with lower fees.

 

Vanguard Whitehall Funds, Selected Value Fund (VASVX Quick QuoteVASVX - Free Report) : The pursuit of capital appreciation is the goal of VASVX. It generally invests in mid and small-capitalization companies' value stocks. It specifically looks for stocks that are undervalued and overlooked by most investors. Whenever there are dividends or capital gains, it distributes them in December.

 

Richard Lawrence Greenberg has been the lead manager of VASVX since Feb 24, 2005.Most of the fund’s holdings was in companies like AERCAP HOLDINGS NV (3.4%), UNUM GROUP (2.04%), and GILDAN ACTIVEWEAR INC (1.9%) as of Oct 31, 2022.

 

VASVX’s 3-year and 5-year annualized returns are 28.1% and 7.3%respectively. Its net expense ratio is 0.38% compared to the category average of 1.1%. VASVX has a Zacks Mutual Fund Rank #1.

 

To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.

 

Vanguard Health Care Fund (VGHCX Quick QuoteVGHCX - Free Report) ): The basic objectives of VGHCX are to generate dividend income and long-term capital growth. It endeavors to have a well-diversified representation of the healthcare sector in its portfolio, in order to meet this goal. Dividends and capital gains are disbursed annually in December.

 

Jean M Hynes, has been the lead manager of VGHCX since May 28, 2008. Most of the fund’s holdings were in companies like UNITEDHEALTH GROUP INC (7.3%), ELI LILLY & CO (6.3%) and PFIZER INC (5.2%) as of Oct 31, 2022.

 

VGHCX’s 3-year and 5-year annualized returns are 12.5% and 7.5%, respectively. Its net expense ratio is 0.32% compared to the category average of 1.03%. VGHCX has a Zacks Mutual Fund Rank #1.

 

Vanguard Wellington Fund (VWELX Quick QuoteVWELX - Free Report) ): seeks to generate income and expand capital while reducing capital risk. Common stocks and bonds make up both its asset categories, with stocks making up 65% of the portfolio and bonds making up the remaining 35%.

 

VWELX is cautiously managed, and adjustments to asset allocation are made gradually to improve income or take into account the relative strengths of the stock and bond markets. On a quarterly basis, it distributes dividends in the months of March, June, September and December. Every December, capital gains are dispersed.

 

Loren L. Moranhas been the lead manager of VWELX since Jan 26, 2017.Most of the fund’s holdings were in companies like MICROSOFT CORP (4.6%), CHARLES SCHWAB CORP (2.8%) and APPLE INC (2.5%) as of Nov 30, 2022.

 

VWELX’s 3-year and 5-year annualized returns are 10.54% and 7.2%, respectively. Its net expense ratio is 0.25% compared to the category average of 0.84%. VWELX has a Zacks Mutual Fund Rank #1.

Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>