Are you on the hunt for a Mutual Fund Equity Report fund? You should think about starting with Vanguard Total Stock Market Index Investor (VTSMX). VTSMX 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
Vanguard Group is based in Malvern, PA, and is the manager of VTSMX. Vanguard Total Stock Market Index Investor debuted in April of 1992. Since then, VTSMX has accumulated assets of about $19.64 billion, according to the most recently available information. Gerard O’Reilly is the fund’s current manager and has held that role since November of 2000.
Investors naturally seek funds with strong performance. VTSMX has a 5-year annualized total return of 8.92% 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 9.29%, 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. VTSMX’s standard deviation over the past three years is 22.1% compared to the category average of 17.93%. The fund’s standard deviation over the past 5 years is 19.33% compared to the category average of 15.73%. This makes the fund more volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 1.03, which means it is hypothetically as volatile as the market at large. 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. VTSMX’s 5-year performance has produced a negative alpha of -0.69, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Investigating 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 principally on equities that are traded in the United States.
The mutual fund currently has 99.48% of its holdings in stocks, with an average market capitalization of $213.88 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 4%, 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, VTSMX is a no load fund. It has an expense ratio of 0.14% compared to the category average of 0.78%. From a cost perspective, VTSMX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
This could just be the start of your research on VTSMXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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