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Any investors hoping to find a Muni - Bonds fund could think about starting with Vanguard Intermediate-Term Tax-Exempt Admiral (VWIUX). VWIUX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
VWIUX is one of many Muni - Bonds funds to choose from. Muni - Bonds funds invest in debt securities issued by states and local municipalities, which are typically used to pay for infrastructure construction, schools, and other government functions. These securities can be backed by taxes (revenue bonds), but others are known as " general obligation " and are not necessarily backed by a defined source. These bonds are especially attractive because of their inherent tax benefits.
History of Fund/Manager
VWIUX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Vanguard Intermediate-Term Tax-Exempt Admiral made its debut in February of 2001, and since then, VWIUX has accumulated about $73.89 billion in assets, per the most up-to-date date available. James D'Arcy is the fund's current manager and has held that role since June of 2013.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 1.59%, 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 2.7%, 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. VWIUX's standard deviation over the past three years is 5.93% compared to the category average of 10.22%. Over the past 5 years, the standard deviation of the fund is 5.36% compared to the category average of 10.46%. This makes the fund less volatile than its peers over the past half-decade.
VWIUX carries a beta of 0.61, 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 0.18, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, VWIUX has 60.4% in high quality bonds rated at least 'AA' or higher, while 34.4% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of AA, and focuses on high quality securities.