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Any investors hoping to find an Investment Grade Bond - Short fund could think about starting with Vanguard Short-Term Investment-Grade Admiral (VFSUX). VFSUX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that VFSUX is an Investment Grade Bond - Short option, which is an area loaded with different options. Investment Grade Bond - Short funds focus on the short end of the curve, generally with bonds that mature in less than two years. Fixed income instruments with this maturity level usually have low duration risk, while they also pay out small yields, at least when compared to their longer-dated peers. Additionally, the focus on investment grade will make funds here safer, but yields will be lower than in the junk bond category.
History of Fund/Manager
Vanguard Group is based in Malvern, PA, and is the manager of VFSUX. The Vanguard Short-Term Investment-Grade Admiral made its debut in February of 2001 and VFSUX has managed to accumulate roughly $36.69 billion in assets, as of the most recently available information. The fund's current manager, Daniel Shaykevich, has been in charge of the fund since April of 2018.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 1.93%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 1.44%, which places it in the middle 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. The standard deviation of VFSUX over the past three years is 3.73% compared to the category average of 10.49%. Over the past 5 years, the standard deviation of the fund is 3.58% compared to the category average of 11.16%. This makes the fund less volatile than its peers over the past half-decade.
VFSUX carries a beta of 0.45, 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 0.79, which measures performance on a risk-adjusted basis.