Have you been searching for a Mutual Fund Equity Report fund? You might want to begin with Vanguard Materials Index Admiral (VMIAX). While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
VMIAX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Materials Index Admiral made its debut in January of 2004, and since then, VMIAX has accumulated about $982.01 million in assets, per the most up-to-date date available. William Coleman is the fund’s current manager and has held that role since August of 2015.
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 6.5%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 10.3%, 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. VMIAX’s standard deviation over the past three years is 25.62% compared to the category average of 29.89%. Looking at the past 5 years, the fund’s standard deviation is 22.73% compared to the category average of 26.89%. This makes the fund less volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 1.11, which means it is hypothetically more volatile than the market at large. 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. The fund has produced a negative alpha over the past 5 years of -2.88, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is mostly on equities that are traded in the United States.
As of the last filing date, the mutual fund has 82.01% of its assets in stocks, with an average market capitalization of $40.93 billion. The fund has the heaviest exposure to the following market sectors:
- Industrial Cyclical
Turnover is 4%, which means this fund makes fewer trades than the average comparable fund.
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, VMIAX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 0.98%. Looking at the fund from a cost perspective, VMIAX is actually cheaper than its peers.
While the minimum initial investment for the product is $100,000, investors should also note that each subsequent investment needs to be at least $1.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds 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.