April 13, 2024
Funds

Is VIPSX a Strong Bond Fund Right Now? – December 25, 2023


Looking for a Mutual Fund Bond fund? You may want to consider Vanguard Inflation Protected Securities Fund (VIPSX Free Report) as a possible option. VIPSX holds a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.

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 $2.62 billion, according to the most recently available information. John Madziyire is the fund’s current manager and has held that role since November of 2021.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 2.48%, 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 -1.72%, 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. Compared to the category average of 12.18%, the standard deviation of VIPSX over the past three years is 6.99%. The fund’s standard deviation over the past 5 years is 6.07% compared to the category average of 12.38%. This makes the fund less volatile than its peers over the past half-decade.

This fund has a beta of 0.66, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, VIPSX has a positive alpha of 1.63, 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 0.82%. VIPSX is actually cheaper than its peers when you consider factors like cost.

While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to 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, Vanguard Inflation Protected Securities Fund ( VIPSX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

For additional information on the Mutual Fund Bond area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into VIPSX too 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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