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If investors are looking at the Allocation Balanced fund category, Vanguard Wellington Admiral (VWENX) could be a potential option. VWENX bears 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 Zacks’ Allocation Balanced funds is an area filled with options, such as VWENX. These funds like to invest in a variety of asset types, finding a balance between stocks, bonds, cash, and sometimes even precious metals and commodities; they are mostly categorized by their respective asset allocation. For investors, Allocation Balanced funds can provide an entry point into diversified mutual funds, and present core holding options for a portfolio of funds.

History of Fund/Manager

VWENX is a part of the Vanguard Group family of funds, a company based out of Malvern, PA. Since Vanguard Wellington Admiral made its debut in May of 2001, VWENX has garnered more than $94.21 billion in assets. Loren Moran is the fund’s current manager and has held that role since January of 2017.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 8.8%, 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 5.88%, 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. Compared to the category average of 13.26%, the standard deviation of VWENX over the past three years is 12.45%. The fund’s standard deviation over the past 5 years is 12.53% compared to the category average of 14.15%. 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 0.67, so it is likely going to be less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio’s performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. Over the past 5 years, the fund has a negative alpha of -1.46. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

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, VWENX is a no load fund. It has an expense ratio of 0.18% compared to the category average of 0.88%. VWENX is actually cheaper than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $50,000 and that each subsequent investment needs to be at $1

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

Bottom Line

Overall, Vanguard Wellington Admiral ( VWENX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Vanguard Wellington Admiral ( VWENX ) looks like a good potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Allocation Balanced, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio – both funds and stocks – in the most efficient way possible.

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