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Is Vanguard PRIMECAP Core Investor (VPCCX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Large Cap Growth fund category, a potential starting could be Vanguard PRIMECAP Core Investor (VPCCX - Free Report) . VPCCX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

VPCCX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.

History of Fund/Manager

VPCCX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard PRIMECAP Core Investor debuted in December of 2004. Since then, VPCCX has accumulated assets of about $11.34 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. VPCCX has a 5-year annualized total return of 18.34% and it sits 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 15.6%, which places it in the top 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 VPCCX over the past three years is 11.17% compared to the category average of 11.42%. The standard deviation of the fund over the past 5 years is 10.15% compared to the category average of 10.92%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, VPCCX lost 43.02% and outperformed its peer group by 5.87%. This might suggest that the fund is a better choice than its peers during a bear market.

Nevertheless, with a 5-year beta of 1, the fund is likely to be as volatile as the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. VPCCX has generated a positive alpha over the past five years of 2.13, demonstrating 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, VPCCX is a no load fund. It has an expense ratio of 0.46% compared to the category average of 1.12%. VPCCX is actually cheaper than its peers when you consider factors like cost.

This fund requires a minimum initial investment of $3,000, and each subsequent investment should be at least $1.

Bottom Line

Overall, Vanguard PRIMECAP Core Investor has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

Want even more information about VPCCX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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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