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Is Vanguard Value Index Investor (VIVAX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Large Cap Value fund? Vanguard Value Index Investor (VIVAX - Free Report) is a potential starting point. VIVAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VIVAX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; growth levels; however, growth levels are oftentimes cut back. These funds'high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream fund Large Cap Value funds very appealing.
History of Fund/Manager
Vanguard Group is responsible for VIVAX, and the company is based out of Malvern, PA. The Vanguard Value Index Investor made its debut in November of 1992 and VIVAX has managed to accumulate roughly $1.62 billion in assets, as of the most recently available information. The fund's current manager, Gerard C. O'Reilly, has been in charge of the fund since December of 1994.
Performance
Investors naturally seek funds with strong performance. VIVAX has a 5-year annualized total return of 13.48% 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 10.24%, 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. VIVAX's standard deviation over the past three years is 10.05% compared to the category average of 9.36%. Over the past 5 years, the standard deviation of the fund is 9.73% compared to the category average of 9.19%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. VIVAX lost 53.96% in the most recent bear market and underperformed comparable funds by 3.8%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Nevertheless, with a 5-year beta of 0.96, the fund is likely to be less volatile than 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. Over the past 5 years, the fund has a negative alpha of -0.55. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining 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 largely on equities that are traded in the United States.
The mutual fund currently has 96.68% of its holdings in stocks, and these companies have an average market capitalization of $149.77 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
Industrial Cyclical
With turnover at about 18%, this fund makes fewer trades than its comparable peers.
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, VIVAX is a no load fund. It has an expense ratio of 0.18% compared to the category average of 1.03%. Looking at the fund from a cost perspective, VIVAX is actually cheaper than its peers.
While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard Value Index Investor has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Vanguard Value Index Investor looks like a good potential choice for investors right now.
Don't stop here for your research on Large Cap Value funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare VIVAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is Vanguard Value Index Investor (VIVAX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Large Cap Value fund? Vanguard Value Index Investor (VIVAX - Free Report) is a potential starting point. VIVAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VIVAX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; growth levels; however, growth levels are oftentimes cut back. These funds'high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream fund Large Cap Value funds very appealing.
History of Fund/Manager
Vanguard Group is responsible for VIVAX, and the company is based out of Malvern, PA. The Vanguard Value Index Investor made its debut in November of 1992 and VIVAX has managed to accumulate roughly $1.62 billion in assets, as of the most recently available information. The fund's current manager, Gerard C. O'Reilly, has been in charge of the fund since December of 1994.
Performance
Investors naturally seek funds with strong performance. VIVAX has a 5-year annualized total return of 13.48% 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 10.24%, 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. VIVAX's standard deviation over the past three years is 10.05% compared to the category average of 9.36%. Over the past 5 years, the standard deviation of the fund is 9.73% compared to the category average of 9.19%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. VIVAX lost 53.96% in the most recent bear market and underperformed comparable funds by 3.8%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Nevertheless, with a 5-year beta of 0.96, the fund is likely to be less volatile than 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. Over the past 5 years, the fund has a negative alpha of -0.55. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining 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 largely on equities that are traded in the United States.
The mutual fund currently has 96.68% of its holdings in stocks, and these companies have an average market capitalization of $149.77 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 18%, this fund makes fewer trades than its comparable peers.
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, VIVAX is a no load fund. It has an expense ratio of 0.18% compared to the category average of 1.03%. Looking at the fund from a cost perspective, VIVAX is actually cheaper than its peers.
While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard Value Index Investor has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Vanguard Value Index Investor looks like a good potential choice for investors right now.
Don't stop here for your research on Large Cap Value funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare VIVAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.