Looking for a Target (NYSE:TGT) Date fund? You may want to consider Vanguard Target Retirement 2030 Fund (VTHRX) as a possible option. The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
History of Fund/Manager
VTHRX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Target Retirement 2030 Fund debuted in June of 2006. Since then, VTHRX has accumulated assets of about $44.57 billion, according to the most recently available information. The fund's current manager, William Coleman, has been in charge of the fund since February of 2013.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 9.42%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 8.34%, 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. Compared to the category average of 12.73%, the standard deviation of VTHRX over the past three years is 12.93%. Over the past 5 years, the standard deviation of the fund is 10.68% compared to the category average of 10.6%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.68, which means 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. With a negative alpha of -0.49, 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, VTHRX is a no load fund. It has an expense ratio of 0.14% compared to the category average of 0.50%. From a cost perspective, VTHRX is actually cheaper than its peers.
This fund requires a minimum initial investment of $1,000, and each subsequent investment should be at least $1.
Bottom Line
For additional information on the Target Date 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 VTHRX 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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