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Is Vanguard Small-Cap Index Administrative (VSMAX) a Strong Mutual Fund Pick Right Now?
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Any investors who are searching for Index funds should take a look at Vanguard Small-Cap Index Administrative (VSMAX - Free Report) . The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
Objective
History of Fund/Manager
Vanguard Group is responsible for VSMAX, and the company is based out of Malvern, PA. Vanguard Small-Cap Index Administrative debuted in November of 2000. Since then, VSMAX has accumulated assets of about $37.11 billion, according to the most recently available information. William A. Coleman is the fund's current manager and has held that role since April of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. VSMAX has a 5-year annualized total return of 11.35% and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 11.22%, 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 VSMAX over the past three years is 12.22% compared to the category average of 8.81%. Looking at the past 5 years, the fund's standard deviation is 11.85% compared to the category average of 8.72%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In VSMAX's case, the fund lost 53.18% in the most recent bear market and outperformed its peer group by 6.63%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.02, so it is likely going to be 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. With a negative alpha of -1.57, 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, VSMAX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.85%. So, VSMAX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $10,000, and each subsequent investment should be at least $1.
Bottom Line
Want even more information about VSMAX? 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 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 Small-Cap Index Administrative (VSMAX) a Strong Mutual Fund Pick Right Now?
Any investors who are searching for Index funds should take a look at Vanguard Small-Cap Index Administrative (VSMAX - Free Report) . The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
Objective
History of Fund/Manager
Vanguard Group is responsible for VSMAX, and the company is based out of Malvern, PA. Vanguard Small-Cap Index Administrative debuted in November of 2000. Since then, VSMAX has accumulated assets of about $37.11 billion, according to the most recently available information. William A. Coleman is the fund's current manager and has held that role since April of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. VSMAX has a 5-year annualized total return of 11.35% and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 11.22%, 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 VSMAX over the past three years is 12.22% compared to the category average of 8.81%. Looking at the past 5 years, the fund's standard deviation is 11.85% compared to the category average of 8.72%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In VSMAX's case, the fund lost 53.18% in the most recent bear market and outperformed its peer group by 6.63%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.02, so it is likely going to be 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. With a negative alpha of -1.57, 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, VSMAX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.85%. So, VSMAX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $10,000, and each subsequent investment should be at least $1.
Bottom Line
Want even more information about VSMAX? 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 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.