Is VFIJX a Strong Bond Fund Right Now?

Any investors hoping to find a Mutual Fund Bond fund could think about starting with Vanguard GNMA Admiral (VFIJX). VFIJX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

Vanguard Group is based in Malvern, PA, and is the manager of VFIJX. Since Vanguard GNMA Admiral made its debut in February of 2001, VFIJX has garnered more than $14.42 billion in assets. The fund is currently managed by Joseph Marvan who has been in charge of the fund since May of 2019.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 1.36%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 0.74%, 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. VFIJX's standard deviation over the past three years is 2.3% compared to the category average of 8.91%. Over the past 5 years, the standard deviation of the fund is 2.24% compared to the category average of 7.91%. This makes the fund less volatile than its peers over the past half-decade.

This fund has a beta of 0.44, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, VFIJX has a negative alpha of -0.24, which measures performance on a risk-adjusted basis.

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, VFIJX is a no load fund. It has an expense ratio of 0.11% compared to the category average of 0.77%. Looking at the fund from a cost perspective, VFIJX is actually cheaper than its peers.

This fund requires a minimum initial investment of $50,000, and each subsequent investment should be at least $1.

Bottom Line

Overall, Vanguard GNMA Admiral ( VFIJX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

Your research on the Mutual Fund Bond 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 want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.

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