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Having trouble finding a Government Bond - Short fund? Vanguard Short-Term Federal Investor (VSGBX) is a potential starting point. VSGBX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
The world of Government Bond - Short funds is an area filled with options, such as VSGBX. 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
Vanguard Group is responsible for VSGBX, and the company is based out of Malvern, PA. Vanguard Short-Term Federal Investor debuted in December of 1987. Since then, VSGBX has accumulated assets of about $387 million, according to the most recently available information. The fund's current manager, Brian Quigley, has been in charge of the fund since January of 2015.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 1.14%, and it sits 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 0.56%, 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. Over the past three years, VSGBX's standard deviation comes in at 2.87%, compared to the category average of 8.54%. The standard deviation of the fund over the past 5 years is 2.41% compared to the category average of 8.76%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.42, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, VSGBX has a negative alpha of -0.38, which measures performance on a risk-adjusted basis.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, VSGBX is a no load fund. It has an expense ratio of 0.20% compared to the category average of 0.75%. So, VSGBX is actually cheaper than its peers from a cost perspective.