Founded by John C. Bogle in 1975, Vanguard is one of the world's largest investment management companies. The company offers about 190 domestic funds and 220 funds for foreign markets. It also offers asset management and financial planning services to clients throughout the globe.
Vanguard stands out from other mutual fund companies because it is owned by the funds themselves. The company believes that this structure helps management to focus more on shareholder interests. Among the notable advantages Vanguard claims to offer are low-cost and no-load funds.
Notably, for the 10-year period ended Sep 30, 2019, nine Vanguard money market funds, 45 Vanguard bond funds, 22 Vanguard balanced funds and 99 Vanguard stock funds beat their Lipper peer-group average.
Vanguard’s Performance So Far this Year
By the end of January 2020, Vanguard had around $6.2 trillion assets under management. The initial investment of the majority of mutual funds from the family ranges from $0 to $3,000. As of Mar 31 2020, none of the Vanguard mutual funds carried any load.
Further, Vanguard Massachusetts Tax-Exempt Fund Investor Shares (
VMATX Quick Quote VMATX - Free Report) turned out as one of the best-performing mutual funds from the Vanguard family. VMATX, which invests a bulk of its assets in municipal bonds issued by Massachusetts state and local governments, has returned 11.3% in the past year. 4 Best Funds to Buy Now
Given such bullish circumstances, we have highlighted four Vanguard mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) and are poised to gain. Moreover, these funds have encouraging three and one-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more:
Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money). Vanguard LifeStrategy Growth Fund ( VASGX Quick Quote VASGX - Free Report) invests in other Vanguard mutual funds with asset allocation of nearly 80% in equity securities and about 20% in debt securities and bonds. VASGX seeks appreciation of income and capital for the long run.
This fund has a history of positive total returns for over 10 years. Specifically, the fund's returns over the three year and one-year benchmarksare 6.9% and 5.6%, respectively. VASGX has an annual expense ratio of 0.14%, which is below the category average of 0.77%.
Vanguard Wellington Fund Investor Shares ( VWELX Quick Quote VWELX - Free Report) seeks appreciation of capital in the long-term and generate moderate current income. The fund invests the lion’s share of its assets in dividend-paying as well as non-dividend-paying common stocks of large-cap companies. The fund also invests assets, to a lesser extent, in investment-grade corporate bonds and mortgage-backed securities.
This fund has a history of positive total returns for over 10 years. Specifically, the fund's returns over the three year and one-year benchmarks are 7.6% and 8.8%, respectively. VWELX has an annual expense ratio of 0.25%, which is below the category average of 0.82%.
Vanguard Short-Term Investment-Grade Fund Investor Shares ( VFSTX Quick Quote VFSTX - Free Report) seeks income while maintaining limited price volatility. VFSTX invests in a variety of high-quality and, to a lesser extent, medium-quality fixed income securities. The fund also invests to a limited extent in non-investment-grade and fixed income securities, mainly short-term and intermediate-term corporate bonds.
This fund has a history of positive total returns for over 10 years. Specifically, the fund's returns over the three year and one-year benchmarks are 3.2% and 6.2%, respectively. VFSTX has an annual expense ratio of 0.20%, which is below the category average of 0.73%.
Vanguard Short-Term Treasury Fund Investor Shares ( VFISX Quick Quote VFISX - Free Report) seeks current income with minimum price volatility. VFISX invests a large share of its assets in U.S. Treasury instruments such as bills, bonds and notes. VFISX seeks to maintain a dollar-weighted average maturity between 1 and 4 years.
The fund has a history of positive total returns for over 10 years. Specifically, the fund's returns over the three year and one-year benchmarks are 2.2% and 5%, respectively. VFISX has an annual expense ratio of 0.20%, which is below the category average of 0.73%.
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