Is Vanguard PRIMECAP Core Investor (VPCCX) a Strong Mutual Fund Pick Right Now?

If you have been looking for Large Cap Growth fund category, a potential starting could be Vanguard PRIMECAP Core Investor (VPCCX). VPCCX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.

VPCCX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.

Vanguard Group is based in Malvern, PA, and is the manager of VPCCX. Vanguard PRIMECAP Core Investor debuted in December of 2004. Since then, VPCCX has accumulated assets of about $11.75 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 16.94%, and is in the middle third among its category peers. If you’re interested in shorter time frames, do not dismiss looking at the fund’s 3 -year annualized total return of 7.91%, 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 VPCCX over the past three years is 16.93% compared to the category average of 16.77%. The standard deviation of the fund over the past 5 years is 16.12% compared to the category average of 17.87%. This makes the fund less volatile than its peers over the past half-decade.

With a 5-year beta of 0.9, the fund is likely to be less volatile than the market average. 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 positive alpha of 0.02, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

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, VPCCX is a no load fund. It has an expense ratio of 0.38% compared to the category average of 0.73%. So, VPCCX is actually cheaper than its peers from a cost perspective.