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Is Vanguard Mid-Cap Growth Fund (VMGRX) a Strong Mutual Fund Pick Right Now?

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Having trouble finding a Mid Cap Growth fund? Vanguard Mid-Cap Growth Fund (VMGRX - Free Report) is a potential starting point. VMGRX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes VMGRX as Mid Cap Growth, a segment packed with options. Mid Cap Growth mutual funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. A firm is typically considered to be a growth stock if it consistently posts impressive sales and/or earnings growth.

History of Fund/Manager

Vanguard Group is responsible for VMGRX, and the company is based out of Malvern, PA. The Vanguard Mid-Cap Growth Fund made its debut in December of 1997 and VMGRX has managed to accumulate roughly $2.75 billion in assets, as of the most recently available information. Michael Cling is the fund's current manager and has held that role since November of 2025.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 1.66%, and it sits in the middle 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 10.65%, 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 18.35%, the standard deviation of VMGRX over the past three years is 19.54%. The standard deviation of the fund over the past 5 years is 20.92% compared to the category average of 20.08%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 1.21, so it is likely going to be more volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. VMGRX's 5-year performance has produced a negative alpha of -10.81, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, VMGRX is a no load fund. It has an expense ratio of 0.33% compared to the category average of 1.05%. Looking at the fund from a cost perspective, VMGRX is actually cheaper than its peers.

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

Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.

Bottom Line

Overall, Vanguard Mid-Cap Growth Fund ( VMGRX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Vanguard Mid-Cap Growth Fund ( VMGRX ) looks like a great potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Mid Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.

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