There are plenty of choices in the Large Cap Growth category, but where should you start your research? Well, one fund that you should consider investigating is Vanguard PRIMECAP Fund Investor (VPMCX). VPMCX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
We classify VPMCX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.
Vanguard Group is responsible for VPMCX, and the company is based out of Malvern, PA. Vanguard PRIMECAP Fund Investor made its debut in November of 1984, and since then, VPMCX has accumulated about $4.86 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund’s current manager.
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 14.31%, 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 14.59%, 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, VPMCX’s standard deviation comes in at 15.45%, compared to the category average of 15.26%. The fund’s standard deviation over the past 5 years is 15.94% compared to the category average of 14.81%. 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 0.94, so it is likely going to be less volatile than the market at large. 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 negative alpha over the past 5 years of -0.59, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.