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Is Vanguard US Growth Admiral (VWUAX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Large Cap Growth funds, a place to start could be Vanguard US Growth Admiral (VWUAX - Free Report) . VWUAX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VWUAX 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
Vanguard Group is based in Malvern, PA, and is the manager of VWUAX. Vanguard US Growth Admiral made its debut in August of 2001, and since then, VWUAX has accumulated about $6.30 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
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 16.31%, 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 19.06%, 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 VWUAX over the past three years is 10.48% compared to the category average of 10.29%. Over the past 5 years, the standard deviation of the fund is 10.9% compared to the category average of 9.91%. This makes the fund more 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, VWUAX lost 47.12% and underperformed comparable funds by 1.85%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.01, 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. The fund has produced a positive alpha over the past 5 years of 2.1, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
This fund is currently holding about 97.05% stock in stocks, with an average market capitalization of $231.09 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Turnover is 70%, which means, on average, the fund makes fewer trades than comparable funds.
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, VWUAX is a no load fund. It has an expense ratio of 0.31% compared to the category average of 1.10%. VWUAX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $50,000, investors should also note that each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard US Growth Admiral ( VWUAX ) 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 this product, or to compare it to other mutual funds in the Large Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds 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 US Growth Admiral (VWUAX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Large Cap Growth funds, a place to start could be Vanguard US Growth Admiral (VWUAX - Free Report) . VWUAX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
VWUAX 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
Vanguard Group is based in Malvern, PA, and is the manager of VWUAX. Vanguard US Growth Admiral made its debut in August of 2001, and since then, VWUAX has accumulated about $6.30 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
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 16.31%, 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 19.06%, 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 VWUAX over the past three years is 10.48% compared to the category average of 10.29%. Over the past 5 years, the standard deviation of the fund is 10.9% compared to the category average of 9.91%. This makes the fund more 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, VWUAX lost 47.12% and underperformed comparable funds by 1.85%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.01, 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. The fund has produced a positive alpha over the past 5 years of 2.1, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
This fund is currently holding about 97.05% stock in stocks, with an average market capitalization of $231.09 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
Turnover is 70%, which means, on average, the fund makes fewer trades than comparable funds.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, VWUAX is a no load fund. It has an expense ratio of 0.31% compared to the category average of 1.10%. VWUAX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $50,000, investors should also note that each subsequent investment needs to be at least $1.
Bottom Line
Overall, Vanguard US Growth Admiral ( VWUAX ) 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 this product, or to compare it to other mutual funds in the Large Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds 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.