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Is Vanguard Tax-Managed Cap Appreciation Institutional (VTCIX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Mutual Fund Equity Report fund category, Vanguard Tax-Managed Cap Appreciation Institutional (VTCIX - Free Report) could be a potential option. VTCIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VTCIX. Vanguard Tax-Managed Cap Appreciation Institutional debuted in February of 1999. Since then, VTCIX has accumulated assets of about $2.40 billion, according to the most recently available information. The fund's current manager, Awais Khan, has been in charge of the fund since July of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 10.89%, 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 9.76%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. VTCIX's standard deviation over the past three years is 18.17% compared to the category average of 16.21%. Looking at the past 5 years, the fund's standard deviation is 19.11% compared to the category average of 17.06%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VTCIX has a 5-year beta of 1.02, which means it is likely to be as volatile as the market average. 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 -0.2, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 mostly on equities that are traded in the United States.
Right now, 82.21% of this mutual fund's holdings are stocks and it has 2.11% of assets in foreign securities. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Retail Trade
This fund's turnover is about 0%, so the fund managers are making fewer trades than the average comparable fund.
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, VTCIX is a no load fund. It has an expense ratio of 0.06% compared to the category average of 0.86%. So, VTCIX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $5 million; each subsequent investment needs to be at least $1.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Tax-Managed Cap Appreciation Institutional ( VTCIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VTCIX too for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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Is Vanguard Tax-Managed Cap Appreciation Institutional (VTCIX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Mutual Fund Equity Report fund category, Vanguard Tax-Managed Cap Appreciation Institutional (VTCIX - Free Report) could be a potential option. VTCIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VTCIX. Vanguard Tax-Managed Cap Appreciation Institutional debuted in February of 1999. Since then, VTCIX has accumulated assets of about $2.40 billion, according to the most recently available information. The fund's current manager, Awais Khan, has been in charge of the fund since July of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 10.89%, 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 9.76%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. VTCIX's standard deviation over the past three years is 18.17% compared to the category average of 16.21%. Looking at the past 5 years, the fund's standard deviation is 19.11% compared to the category average of 17.06%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VTCIX has a 5-year beta of 1.02, which means it is likely to be as volatile as the market average. 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 -0.2, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 mostly on equities that are traded in the United States.
Right now, 82.21% of this mutual fund's holdings are stocks and it has 2.11% of assets in foreign securities. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
- Retail Trade
This fund's turnover is about 0%, so the fund managers are making fewer trades than the average comparable fund.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, VTCIX is a no load fund. It has an expense ratio of 0.06% compared to the category average of 0.86%. So, VTCIX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $5 million; each subsequent investment needs to be at least $1.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Tax-Managed Cap Appreciation Institutional ( VTCIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VTCIX too for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.