Looking for a Large Cap Blend fund? You may want to consider Vanguard Institutional Index Plus (VIIIX) as a possible option. While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
Objective
VIIIX is classified in the Large Cap Blend segment by Zacks, which is an area full of potential. Targeting companies with market caps of more than $10 billion, Large Cap Blend mutual funds offer a stable investment choice; these funds are perfect for investors with a ‘buy and hold’ mindset. Since blended funds mix large, more established firms into their portfolios, investors are exposed to both value and growth opportunities.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VIIIX. The Vanguard Institutional Index Plus made its debut in July of 1997 and VIIIX has managed to accumulate roughly $222.79 billion in assets, as of the most recently available information. The fund’s current manager is a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 12.77%, and it sits in the top 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 21.02%, which places it in the top 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. VIIIX’s standard deviation over the past three years is 12.27% compared to the category average of 11.88%. The fund’s standard deviation over the past 5 years is 15.41% compared to the category average of 14.17%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1, the fund is likely to be as volatile as the market average. 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. VIIIX’s 5-year performance has produced a negative alpha of -0.05, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.