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Is Vanguard Global Minimum Volatility Fund Admiral (VMNVX) a Strong Mutual Fund Pick Right Now?

Mutual Fund Report for VMNVX

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This story originally appeared on Zacks

Having trouble finding a Global - Equity fund? Well, Vanguard Global Minimum Volatility Fund Admiral (VMNVX) would not be a good potential starting point right now. VMNVX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.

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Objective

We note that VMNVX is a Global - Equity option, an investment area loaded with different options. While Global - Equity mutual funds invest their assets in large markets--think the U.S., Europe, and Japan--they aren't limited by geography. Their investment technique is one that leverages the global economy in order to offer stable returns.

History of Fund/Manager

Vanguard Group is based in Malvern, PA, and is the manager of VMNVX. Since Vanguard Global Minimum Volatility Fund Admiral made its debut in December of 2013, VMNVX has garnered more than $2.56 billion in assets. The fund is currently managed by Antonio Picca who has been in charge of the fund since November of 2018.

Performance

Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 7.79%, and is 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 6.04%, which places it in the top third during this time-frame.

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. Over the past three years, VMNVX's standard deviation comes in at 14.16%, compared to the category average of 18.61%. The fund's standard deviation over the past 5 years is 11.33% compared to the category average of 15.14%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 0.68, so investors should note that it is hypothetically less volatile than the market at large. 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. VMNVX's 5-year performance has produced a negative alpha of -3.83, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, VMNVX is a no load fund. It has an expense ratio of 0.14% compared to the category average of 1.13%. So, VMNVX is actually cheaper than its peers from a cost perspective.

While the minimum initial investment for the product is $50,000, investors should also note that each subsequent investment needs to be at least $1.

Bottom Line

Overall, Vanguard Global Minimum Volatility Fund Admiral ( VMNVX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Vanguard Global Minimum Volatility Fund Admiral ( VMNVX ) looks like a somewhat weak choice for investors right now.

Want even more information about VMNVX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.



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