Having trouble finding a Allocation Balanced fund? Well, Vanguard LifeStrategy Income Fund (VASIX) would not be a good potential starting point right now. VASIX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
VASIX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
VASIX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard LifeStrategy Income Fund made its debut in September of 1994, and since then, VASIX has accumulated about $3.86 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. VASIX has a 5-year annualized total return of 2%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 8.46%, 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. VASIX’s standard deviation over the past three years is 5.66% compared to the category average of 8.53%. Looking at the past 5 years, the fund’s standard deviation is 7.05% compared to the category average of 10.66%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.37, so it is likely going to be less volatile than 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. VASIX has generated a negative alpha over the past five years of -5.11, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.