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Is Vanguard Financials Index Admiral (VFAIX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Sector - Finance fund category, Vanguard Financials Index Admiral (VFAIX - Free Report) could be a potential option. VFAIX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
VFAIX is one of many Sector - Finance funds to choose from. Sector - Finance mutual funds provide investors with a diversified and stabilized investment approach focused on the financial space, which is a notoriously large, complex, and heavily-regulated industry. These funds include everything from insurance companies and exchanges to banks and investment giants; interest rates can impact the players of this space as well.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VFAIX. The Vanguard Financials Index Admiral made its debut in January of 2004 and VFAIX has managed to accumulate roughly $1.26 billion in assets, as of the most recently available information. Kenny Narzikul is the fund's current manager and has held that role since February of 2023.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 19.24%, and is in the middle 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 18%, 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. Compared to the category average of 23.48%, the standard deviation of VFAIX over the past three years is 19.5%. The fund's standard deviation over the past 5 years is 20.32% compared to the category average of 22.64%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.02, which means it is hypothetically as volatile as 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 positive alpha over the past 5 years of 3.49, which shows that managers in this portfolio are skilled in picking 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, VFAIX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1.27%. So, VFAIX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $1.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Financials Index Admiral ( VFAIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
This could just be the start of your research on VFAIX in the Sector - Finance category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is Vanguard Financials Index Admiral (VFAIX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Sector - Finance fund category, Vanguard Financials Index Admiral (VFAIX - Free Report) could be a potential option. VFAIX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
VFAIX is one of many Sector - Finance funds to choose from. Sector - Finance mutual funds provide investors with a diversified and stabilized investment approach focused on the financial space, which is a notoriously large, complex, and heavily-regulated industry. These funds include everything from insurance companies and exchanges to banks and investment giants; interest rates can impact the players of this space as well.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VFAIX. The Vanguard Financials Index Admiral made its debut in January of 2004 and VFAIX has managed to accumulate roughly $1.26 billion in assets, as of the most recently available information. Kenny Narzikul is the fund's current manager and has held that role since February of 2023.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 19.24%, and is in the middle 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 18%, 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. Compared to the category average of 23.48%, the standard deviation of VFAIX over the past three years is 19.5%. The fund's standard deviation over the past 5 years is 20.32% compared to the category average of 22.64%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.02, which means it is hypothetically as volatile as 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 positive alpha over the past 5 years of 3.49, which shows that managers in this portfolio are skilled in picking 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, VFAIX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1.27%. So, VFAIX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $1.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, Vanguard Financials Index Admiral ( VFAIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
This could just be the start of your research on VFAIX in the Sector - Finance category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.