The Vanguard Group, founded in 1975 by John C. Bogle, has grown to become one of the world’s largest asset-management firms. As of Sept. 1, 2025, Vanguard manages approximately $11 trillion in assets globally, making it a dominant force in mutual funds and exchange-traded funds.

What sets Vanguard apart is its investor-owned structure. The funds themselves own the company, rather than external shareholders. That design aligns the firm’s incentives directly with those of its investors, a core part of its ethos from inception. Low cost, transparency and long-term thinking remain foundational principles.

In 2025, Vanguard made headlines by announcing its largest-ever reduction in expense ratios. With effect from Feb. 1, the firm cut fees across 168 share classes spanning 87 funds, expected to save investors more than $350 million over the year. This move underlines Vanguard’s commitment to cost-efficient investing, leaving more of the returns in investors’ hands and enhancing long-term compounding potential.

Responding to changing market conditions, notably higher interest rates and economic uncertainty, Vanguard also emphasises fixed-income investments as an area of growing importance. The firm has revamped and expanded its fixed-income offerings, positioning them against equity market volatility for conservative or income-oriented investors. Also, Vanguard is evolving its services beyond traditional mutual funds. The firm launched new model portfolios tailored for financial advisors, including globally diversified fixed-income strategies, designed to help advisors build and manage client portfolios more efficiently.

All told, 2025 has been a milestone year for Vanguard. With historic fee reductions, strong long-term performance, diversification into fixed income and actively managed ETFs, and a reaffirmation of its investor-first philosophy, Vanguard appears to be doubling down on its core strengths while evolving to meet changing investor needs. For investors, especially those seeking broad diversification, disciplined long-term growth and cost efficiency, Vanguard remains a highly relevant and potentially rewarding option.

Hence, it will be prudent to invest in Vanguard mutual funds if one is seeking stability and growth potential in a market that is expected to remain volatile for a while. Astute investors should consider such funds at present. Mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges that are mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

We have thus selected three mutual funds that boast a Zacks Mutual Fund Rank #1 (Strong Buy), have positive three-year and five-year annualized returns and minimum initial investments within $5000, as well as carry a low expense ratio.

Vanguard Selected Value Fund (VASVX Quick QuoteVASVX - Free Report) invests primarily in undervalued stocks of mid-size U.S. companies. VASVX advisors define undervalued stocks as those that are out of favor with investors and are trading at prices below average in relation to measures such as earnings and book value. These stocks often have above-average dividend yields.

Richard Lawrence Greenberg has been the lead manager of VASVX since February 2005. The three top holdings for VASVX are AerCap (3%), Corebridge (2%) and Fidelity National (1.5%).

VASVX’s 3-year and 5-year annualized returns are 13.5% and 16.2%, respectively, and its net expense ratio is 0.36%. VASVX has a Zacks Mutual Fund Rank #1. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.

Vanguard Wellington Investor Shares (VWELX Quick QuoteVWELX - Free Report) normally invests in dividend-paying and sometimes non-dividend-paying common stocks of established large companies. VWELX advisors also invest in fixed-income securities that they believe will generate a moderate level of current income. These securities include investment-grade corporate bonds.

Loren L. Moran has been the lead manager of VWELX since January 2017. The three top holdings for VWELX are Nvidia (5.6%), Microsoft (5.2%) and Apple (4.2%).

VWELX’s 3-year and 5-year annualized returns are 15.8% and 11.1%, respectively, and its net expense ratio is 0.24%. VWELX has a Zacks Mutual Fund Rank #1.

Vanguard Growth & Income Investor Shares (VQNPX Quick QuoteVQNPX - Free Report) invests in stocks that are included in the S&P 500 Index. Most of the stocks held by the fund provide dividend income as well as the potential for capital appreciation.

Hal W. Reynolds has been the lead manager of VQNPX since September 2011. The three top holdings for VQNPX are Nvidia (7.2%), Microsoft (6.7%) and Apple (4.3%).

VQNPX’s 3-year and 5-year annualized returns are 22.5% and 18.1%, respectively, and its net expense ratio is 0.38%. VQNPX has a Zacks Mutual Fund Rank #1.

Want key mutual fund info delivered straight to your inbox?

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