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Is Vanguard Real Estate Index Investor (VGSIX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Index funds, consider Vanguard Real Estate Index Investor (VGSIX - Free Report) as a possibility. VGSIX has no Zacks Mutual Fund Rank, but we have been able to look into other metrics like performance, volatility, and cost.
History of Fund/Manager
VGSIX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Since Vanguard Real Estate Index Investor made its debut in May of 1996, VGSIX has garnered more than $84.60 million in assets. The fund's current manager, Gerard O'Reilly, has been in charge of the fund since November of 2001.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 3.57%, and is in the middle 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 1.61%, which places it in the bottom third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. Over the past three years, VGSIX's standard deviation comes in at 21.77%, compared to the category average of 16.43%. The fund's standard deviation over the past 5 years is 20.57% compared to the category average of 16.85%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.96, the fund is likely to be less volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. The fund has produced a negative alpha over the past 5 years of -9.11, which shows that 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, VGSIX is a no load fund. It has an expense ratio of 0.26% compared to the category average of 0.98%. VGSIX is actually cheaper than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
For additional information on this product, or to compare it to other mutual funds in the Index, make sure to go to www.zacks.com/funds/mutual-funds for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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Is Vanguard Real Estate Index Investor (VGSIX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Index funds, consider Vanguard Real Estate Index Investor (VGSIX - Free Report) as a possibility. VGSIX has no Zacks Mutual Fund Rank, but we have been able to look into other metrics like performance, volatility, and cost.
History of Fund/Manager
VGSIX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Since Vanguard Real Estate Index Investor made its debut in May of 1996, VGSIX has garnered more than $84.60 million in assets. The fund's current manager, Gerard O'Reilly, has been in charge of the fund since November of 2001.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 3.57%, and is in the middle 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 1.61%, which places it in the bottom third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. Over the past three years, VGSIX's standard deviation comes in at 21.77%, compared to the category average of 16.43%. The fund's standard deviation over the past 5 years is 20.57% compared to the category average of 16.85%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.96, the fund is likely to be less volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. The fund has produced a negative alpha over the past 5 years of -9.11, which shows that 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, VGSIX is a no load fund. It has an expense ratio of 0.26% compared to the category average of 0.98%. VGSIX is actually cheaper than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
For additional information on this product, or to compare it to other mutual funds in the Index, make sure to go to www.zacks.com/funds/mutual-funds for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.