Yahoo Finance Is VIPSX a Strong Bond Fund Right Now?
If you've been stuck searching for Government - Bonds: Misc funds, you might want to consider passing on by Vanguard Inflation Protected Securities Fund (VIPSX) as a possibility. VIPSX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that VIPSX is a Government - Bonds: Misc option, and this area is loaded with many different choices. Often seen as risk-free assets and described as extremely low-risk from a default perspective, Government - Bonds: Misc funds hold securities issued by the United States' federal government. This category stretches across the curve, meaning the yields and interest rate sensitivity will vary, but a mixed approach can typically result in a medium yield and risk profile.
History of Fund/Manager
VIPSX finds itself in the Vanguard Group family, based out of Malvern, PA. Vanguard Inflation Protected Securities Fund debuted in June of 2000. Since then, VIPSX has accumulated assets of about $2.36 billion, according to the most recently available information. The fund is currently managed by John Madziyire who has been in charge of the fund since November of 2021.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 1.88%, and is in the middle 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 -1.52%, which places it in the middle 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. VIPSX's standard deviation over the past three years is 7.11% compared to the category average of 12.01%. The fund's standard deviation over the past 5 years is 6.19% compared to the category average of 12.43%. This makes the fund less volatile than its peers over the past half-decade.
VIPSX carries a beta of 0.63, meaning that the fund is less volatile than a broad market index of fixed income securities. With this in mind, it has a positive alpha of 1.73, which measures performance on a risk-adjusted basis.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, VIPSX is a no load fund. It has an expense ratio of 0.20% compared to the category average of 0.83%. So, VIPSX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $3,000, and each subsequent investment should be at least $1.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively similar performance, better downside risk, and lower fees, Vanguard Inflation Protected Securities Fund ( VIPSX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.
Your research on the Government - Bonds: Misc segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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.
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