Is VTAPX a Strong Bond Fund Right Now?

Have you been searching for a Government Bond - Short fund? You might want to begin with Vanguard Short Term Inflation Protected Security Index Advisor (VTAPX). While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.

Objective

The world of Government Bond - Short funds is an area filled with options, such as VTAPX. Government Bond - Short funds hold securities issued by the federal government of the United States of America. These are seen as extremely low risk securities from a default perspective, and are often regarded as risk-free assets. This category focuses on the short end of the curve, and that results in lower yields, but also less sensitivity to interest rate fluctuations, too.

History of Fund/Manager

VTAPX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Since Vanguard Short Term Inflation Protected Security Index Advisor made its debut in October of 2012, VTAPX has garnered more than $21.93 billion in assets. Joshua Barrickman is the fund's current manager and has held that role since October of 2012.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. VTAPX has a 5-year annualized total return of 3.77% and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 3.25%, 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. Over the past three years, VTAPX's standard deviation comes in at 3.14%, compared to the category average of 11.46%. The fund's standard deviation over the past 5 years is 2.78% compared to the category average of 11.16%. This makes the fund less volatile than its peers over the past half-decade.

VTAPX carries a beta of 0.24, meaning that the fund is less volatile than a broad market index of fixed income securities. With this in mind, it has a positive alpha of 2.07, which measures performance on a risk-adjusted basis.

Expenses

As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, VTAPX is a no load fund. It has an expense ratio of 0.06% compared to the category average of 0.82%. From a cost perspective, VTAPX is actually cheaper than its peers.

Investors should also note that the minimum initial investment for the product is $3,000 and that each subsequent investment needs to be at $1

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 Government Bond - Short, make sure to go to www.zacks.com/funds/mutual-funds for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.

Zacks Names #1 Semiconductor Stock

It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.

With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

Source Zacks-com