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Is Vanguard Health Care Index Administrative (VHCIX) a Strong Mutual Fund Pick Right Now?
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Sector - Health fund seekers should consider taking a look at Vanguard Health Care Index Administrative (VHCIX - Free Report) . VHCIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that VHCIX is a Sector - Health fund, and this area is also loaded with various options. Sector - Health mutual funds give investors an opportunity to focus on one of the largest sectors of the American economy, healthcare. Funds in this category can include everything from for-profit hospitals to pharmaceutical companies and medical device manufacturers.
History of Fund/Manager
VHCIX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Health Care Index Administrative debuted in January of 2004. Since then, VHCIX has accumulated assets of about $1.17 billion, according to the most recently available information. Walter Nejman is the fund's current manager and has held that role since December of 2015.
Performance
Of course, investors look for strong performance in funds. VHCIX has a 5-year annualized total return of 14.21% and it sits 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 7.08%, 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. Compared to the category average of 17.32%, the standard deviation of VHCIX over the past three years is 13.73%. The fund's standard deviation over the past 5 years is 12.32% compared to the category average of 16.43%. This makes the fund less 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. VHCIX lost 34.74% in the most recent bear market and outperformed its peer group by 1.86%. This could mean that the fund is a better choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.99, which means it is hypothetically 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. VHCIX's 5-year performance has produced a positive alpha of 1.47, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, VHCIX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1.31%. From a cost perspective, VHCIX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $100,000; each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard Health Care Index Administrative ( VHCIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Sector - Health area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VHCIX too for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.
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Is Vanguard Health Care Index Administrative (VHCIX) a Strong Mutual Fund Pick Right Now?
Sector - Health fund seekers should consider taking a look at Vanguard Health Care Index Administrative (VHCIX - Free Report) . VHCIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that VHCIX is a Sector - Health fund, and this area is also loaded with various options. Sector - Health mutual funds give investors an opportunity to focus on one of the largest sectors of the American economy, healthcare. Funds in this category can include everything from for-profit hospitals to pharmaceutical companies and medical device manufacturers.
History of Fund/Manager
VHCIX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Health Care Index Administrative debuted in January of 2004. Since then, VHCIX has accumulated assets of about $1.17 billion, according to the most recently available information. Walter Nejman is the fund's current manager and has held that role since December of 2015.
Performance
Of course, investors look for strong performance in funds. VHCIX has a 5-year annualized total return of 14.21% and it sits 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 7.08%, 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. Compared to the category average of 17.32%, the standard deviation of VHCIX over the past three years is 13.73%. The fund's standard deviation over the past 5 years is 12.32% compared to the category average of 16.43%. This makes the fund less 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. VHCIX lost 34.74% in the most recent bear market and outperformed its peer group by 1.86%. This could mean that the fund is a better choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.99, which means it is hypothetically 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. VHCIX's 5-year performance has produced a positive alpha of 1.47, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, VHCIX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1.31%. From a cost perspective, VHCIX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $100,000; each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard Health Care Index Administrative ( VHCIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Sector - Health area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VHCIX too for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.