Any investors who are searching for Non US - Equity funds should take a look at Vanguard Emerging Markets Stock Index Investor (VEIEX). The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
Objective
Zacks categorizes VEIEX as Non US - Equity, a segment stacked high with options. Non US - Equity mutual funds like to invest in companies outside of the United States, an important characteristic since global mutual funds are known to keep a good portion of their portfolio stateside. These kinds of funds can often extend across all cap levels, and will typically allocate their investments between emerging and developed markets.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VEIEX. Since Vanguard Emerging Markets Stock Index Investor made its debut in May of 1994, VEIEX has garnered more than $63.73 million in assets. The fund is currently managed by Michael Perre who has been in charge of the fund since August of 2008.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 3.99%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -0.26%, 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. VEIEX's standard deviation over the past three years is 16.22% compared to the category average of 15.19%. The fund's standard deviation over the past 5 years is 17.52% compared to the category average of 16.34%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. VEIEX has a 5-year beta of 0.66, which means it is likely to be less volatile than 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. With a negative alpha of -5.66, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, VEIEX is a no load fund. It has an expense ratio of 0.29% compared to the category average of 0.98%. Looking at the fund from a cost perspective, VEIEX is actually cheaper than its peers.
While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
For additional information on this product, or to compare it to other mutual funds in the Non US - Equity, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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This article originally published on Zacks Investment Research (zacks.com).
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