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Is Vanguard Total International Stock Index Fund (VGTSX) a Strong Mutual Fund Pick Right Now?
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Have you been searching for an Index fund? You might want to begin with Vanguard Total International Stock Index Fund (VGTSX - 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.
History of Fund/Manager
VGTSX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Total International Stock Index Fund made its debut in April of 1996, and since then, VGTSX has accumulated about $132.55 billion in assets, per the most up-to-date date available. The fund's current manager, Michael Perre, has been in charge of the fund since August of 2008.
Performance
Investors naturally seek funds with strong performance. VGTSX has a 5-year annualized total return of 2.61% and it sits in the bottom 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 10.57%, which places it in the middle 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. VGTSX's standard deviation over the past three years is 11.4% compared to the category average of 8.87%. The standard deviation of the fund over the past 5 years is 11.65% compared to the category average of 9%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In VGTSX's case, the fund lost 58.5% in the most recent bear market and underperformed its peer group by 12.96%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VGTSX has a 5-year beta of 0.84, which means it is likely to be less volatile than the market average. 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. VGTSX's 5-year performance has produced a negative alpha of -5.76, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, VGTSX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.74%. From a cost perspective, VGTSX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $3,000 and that each subsequent investment needs to be at $1.
Bottom Line
Your research on the Index segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is Vanguard Total International Stock Index Fund (VGTSX) a Strong Mutual Fund Pick Right Now?
Have you been searching for an Index fund? You might want to begin with Vanguard Total International Stock Index Fund (VGTSX - 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.
History of Fund/Manager
VGTSX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Total International Stock Index Fund made its debut in April of 1996, and since then, VGTSX has accumulated about $132.55 billion in assets, per the most up-to-date date available. The fund's current manager, Michael Perre, has been in charge of the fund since August of 2008.
Performance
Investors naturally seek funds with strong performance. VGTSX has a 5-year annualized total return of 2.61% and it sits in the bottom 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 10.57%, which places it in the middle 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. VGTSX's standard deviation over the past three years is 11.4% compared to the category average of 8.87%. The standard deviation of the fund over the past 5 years is 11.65% compared to the category average of 9%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In VGTSX's case, the fund lost 58.5% in the most recent bear market and underperformed its peer group by 12.96%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VGTSX has a 5-year beta of 0.84, which means it is likely to be less volatile than the market average. 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. VGTSX's 5-year performance has produced a negative alpha of -5.76, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, VGTSX is a no load fund. It has an expense ratio of 0.17% compared to the category average of 0.74%. From a cost perspective, VGTSX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $3,000 and that each subsequent investment needs to be at $1.
Bottom Line
Your research on the Index segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.