9.2 in Large Growth
U.S. News evaluated 469 Large Growth Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.
| Scorecard | |
|---|---|
| Morningstar | 4 / 5 Stars |
| Lipper | 5 5 5 5 2 |
| Zacks Investment Research | 1 (Strong Buy) |
| Standard & Poor's | 5 / 5 Stars |
| TheStreet.com | A (Buy) |
Fund Overview
The Vanguard Growth Index Fund looks to mirror the MSCI U.S. Prime Market Growth Index.
As of April 04, 2012, the fund has assets totaling $24.64 billion. Its portfolio consists primarily of blue-chip growth stocks.
In 2008, this index fund's technology exposure to industry giants such as Google and Apple weighed on returns, but the fund began to show life in 2009 when tech made a turnaround. These sector dynamics are not unusual for the fund, which tracks the MSCI U.S. Prime Market Growth Index. Generally, the fund will perform well when big-name companies are on the rise, but it will also share in their pain when markets turn. Says Morningstar, "When large-growth stocks come into favor, this fund will rally, but when small- and mid-cap growth firms pull away, it may lag some of its actively managed peers that have the flexibility to hold more small- and mid-caps..." The fund has returned 11.66 percent over the past year and 24.95 percent over the past three years.
Historically, the fund has moved closely in line with the index it tracks. One notable shakeup came in 2003, though, when the fund changed to its current index, which was new at the time. Until then, it had tracked the S&P/Barra Growth index. MSCI indexes come with lower turnover by creating "buffer zones" that keep companies from bouncing between growth and value indexes. The fund has returned 5.09 percent over the past five years and 4.44 percent over the past decade.
| Trailing Returns | Updated 03.31.2012 |
|---|---|
| Year to date | 15.2% |
| 1 Year | 11.7% |
| 3 Years (Annualized) | 24.9% |
| 5 Years (Annualized) | 5.1% |
| 10 Years (Annualized) | 4.4% |
Investment Strategy
"The fund employs a 'passive management'--or indexing--investment approach designed to track the performance of the MSCI U.S. Prime Market Growth Index, a broadly diversified index predominantly made up of growth stocks of large U.S. companies. The fund attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index," according to the prospectus.
Role in Portfolio
Morningstar calls it a "supporting player."
Fund Opinion
In the 2009 Award Winners edition of The Independent Adviser for Vanguard Investors, Dan Wiener says, "[Vanguard] Growth Index has always favored the largest and best-known names in the stock market."
2010-01-26
Management
Gerard O'Reilly oversees the fund. It is passively managed.
Morningstar gives this fund a stewardship rating of B on a scale of A to F, saying, "The family's mutual ownership structure helps it offer low fees and keep investor interests paramount. A blemish-free regulatory record and loyal fund owners and employees also help make this a trustworthy fund."
Morningstar 2010-02-17
In the annual Lipper/Barron's Fund Families Survey for 2009, Vanguard ranks 40th out of 61 fund families surveyed.
2010-02-17
Performance
The fund has returned 11.66 percent over the past year, 24.95 percent over the past three years, 5.09 percent over the past five years, and 4.44 percent over the past decade.
Hypothetical Growth of $10,000
Updated 03.31.2012
Holdings
The fund holds stocks in companies that make up part of the MSCI U.S. Prime Market Growth Index.
Asset Allocation
| % Long | % Net | |
|---|---|---|
| Cash | 0.08 | 0.08 |
| Stocks | 99.43 | 99.43 |
| Bonds | 0.0 | 0.0 |
| Other | 0.0 | 0.0 |
| Foreign Bonds | 0.0 | 0.0 |
| Foreign Stocks | 0.49 | 0.49 |
| Convertible | 0.0 | 0.0 |
| Preferred | 0.0 | 0.0 |
Updated 12.31.2011
Top Holdings
Performance as of 03.31.2012
Portfolio as of 12.31.2011
| Ticker | YTD Return % | % Net Assets | |
|---|---|---|---|
| Apple, Inc. | AAPL | 52.75 | 6.12 |
| International Business Machines Corp | IBM | 14.32 | 3.58 |
| Google, Inc. A | GOOG | 0.16 | 2.68 |
| Coca-Cola Co | KO | 6.69 | 2.36 |
| Philip Morris International, Inc. | PM | 14.87 | 2.25 |
In the 2009 Award Winners edition of The Independent Adviser for Vanguard Investors, Dan Wiener says, "[Vanguard] Growth Index has always favored the largest and best-known names in the stock market."
2010-01-26
Fees
Vanguard Growth Index Fund has an expense ratio of 0.24 percent.
Risk
Like any fund that invests in stocks, this one comes with some risks.
