Have you been searching for a Sector - Finance fund? You might want to begin with Vanguard Financials Index Admiral (VFAIX Quick QuoteVFAIX - Free Report) . The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.

Objective

VFAIX is part of the Sector - Finance section, which boasts an array of other possible selections. Sector - Finance funds offer a stable, diversified approach to investing that focuses on the financial industry, an infamously large, complex, and heavily-regulated space. Funds here can include insurance companies and exchanges, as well as banks and investment giants. Investors should note that interest rates may also impact players in this market.

History of Fund/Manager

Vanguard Group is based in Malvern, PA, and is the manager of VFAIX. Since Vanguard Financials Index Admiral made its debut in January of 2004, VFAIX has garnered more than $1.06 billion in assets. The fund's current manager, Nick Birkett, has been in charge of the fund since November of 2017.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 13.59%, and is in the middle 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 11.88%, 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. VFAIX's standard deviation over the past three years is 21.53% compared to the category average of 23.76%. Over the past 5 years, the standard deviation of the fund is 23.73% compared to the category average of 26.25%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 1.09, so it is likely going to be more volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. With a negative alpha of -1.38, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Exploring the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is largely on equities that are traded in the United States.

Currently, this mutual fund is holding 78.8% in stocks, with an average market capitalization of $209.97 billion. The fund has the heaviest exposure to the following market sectors:

• Finance
• Technology

Turnover is 5%, which means, on average, the fund makes fewer trades than the average comparable fund.

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, VFAIX is a no load fund. It has an expense ratio of 0.10% compared to the category average of 1.25%. So, VFAIX is actually cheaper than its peers from a cost perspective.

This fund requires a minimum initial investment of $100,000, and each subsequent investment should be at least $1.

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Your research on the Sector - Finance segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.