Advertisement
UK markets closed
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • FTSE 250

    19,884.73
    +74.07 (+0.37%)
     
  • AIM

    743.26
    +1.15 (+0.15%)
     
  • GBP/EUR

    1.1707
    +0.0013 (+0.11%)
     
  • GBP/USD

    1.2620
    -0.0002 (-0.01%)
     
  • Bitcoin GBP

    55,660.90
    +424.42 (+0.77%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • CRUDE OIL

    83.11
    -0.06 (-0.07%)
     
  • GOLD FUTURES

    2,254.80
    +16.40 (+0.73%)
     
  • NIKKEI 225

    40,404.90
    +236.83 (+0.59%)
     
  • HANG SENG

    16,541.42
    +148.58 (+0.91%)
     
  • DAX

    18,492.49
    +15.40 (+0.08%)
     
  • CAC 40

    8,205.81
    +1.00 (+0.01%)
     

Is Vanguard Growth Index Institutional (VIGIX) a Strong Mutual Fund Pick Right Now?

Investors in search of a Large Cap Growth fund might want to consider looking at Vanguard Growth Index Institutional (VIGIX). VIGIX has no Zacks Mutual Fund Rank, but we have been able to look into other metrics like performance, volatility, and cost.

Objective

VIGIX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.

History of Fund/Manager

VIGIX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. The Vanguard Growth Index Institutional made its debut in May of 1998 and VIGIX has managed to accumulate roughly $16.19 billion in assets, as of the most recently available information. The fund's current manager, Gerard C. O'Reilly, has been in charge of the fund since May of 1998.

ADVERTISEMENT

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 12.3%, and is in the top 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 18.46%, 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. The standard deviation of VIGIX over the past three years is 13.21% compared to the category average of 11.06%. The standard deviation of the fund over the past 5 years is 13.05% compared to the category average of 10.94%. 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, VIGIX lost 47.07% and outperformed its peer group by 2%. This might suggest that the fund is a better choice than its peers during a bear market.

Nevertheless, with a 5-year beta of 1.06, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a positive alpha over the past 5 years of 0.77, which shows that managers in this portfolio are skilled in picking 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, VIGIX is a no load fund. It has an expense ratio of 0.04% compared to the category average of 1.08%. Looking at the fund from a cost perspective, VIGIX is actually cheaper than its peers.

While the minimum initial investment for the product is $5 million, investors should also note that each subsequent investment needs to be at least $1.

Bottom Line

Don't stop here for your research on Large Cap Growth funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare VIGIX to its peers as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Get Your Free (VIGIX): Fund Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research