Vanguard Growth Index Fund

Scorecard
4 / 5 Stars
Lipper
5 5 5 5 4
Zacks Investment Research
3 (Hold)
Standard & Poor's
5 / 5 Stars
TheStreet.com
A (Buy)

U.S. News evaluated 466 Large Growth Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.

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Note: Profile written for different share class.

Performance

The fund has returned 28.56 percent over the past year, 15.58 percent over the past three years, 23.91 percent over the past five years, and 7.90 percent over the past decade.

Trailing Returns Updated 02.28.2014
Year to date 2.4%
1 Year 28.6%
3 Years (Annualized) 15.6%
5 Years (Annualized) 23.9%
10 Years (Annualized) 7.9%

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Summary

The Vanguard Growth Index Fund looks to mirror the MSCI U.S. Prime Market Growth Index.

As of March 05, 2014, the fund has assets totaling $38.56 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 28.56 percent over the past year and 15.58 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 23.91 percent over the past five years and 7.90 percent over the past decade.

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."

Management

Gerard O'Reilly oversees the fund. It is passively managed. 

Fees

Vanguard Growth Index Fund has an expense ratio of ((UNHANDLED TYPE: NoneType for 'None')) percent.

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Risk

Like any fund that invests in stocks, this one comes with some risks. 

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