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Best Vanguard Index Funds


List of 2018 best Vanguard index mutual funds with top Morningstar rating. Highest performing, best returns Vanguard index funds for retirement or investment account investors: Small-Cap Growth Index Fund (VISGX), Vanguard Mid-Cap Index Fund (VIMSX), and Vanguard Growth Index Fund (VIGRX).



Best Vanguard Index Funds Overview


Index funds have proliferated in recent decades, and choosing the best fund for anyone’s portfolio is a daunting challenge. The goal of any index fund is to match a passive benchmark such as the S&P-500 Index, so paying the lowest expenses possible is a top priority. After that comes past long-term performance, followed by the reputation and stability of the fund family.

Below are the top-rated index mutual funds from the Vanguard Group that are good bets to perform as well in the future as they have in the past. Vanguard has been a leader in low-cost mutual fund investing since its inception in 1975. Each fund carries a 4-star or 5-star rating from Morningstar and has been chosen based on average annual total return over the past ten years.



Vanguard Small-Cap Growth Index Fund (VISGX)


The fund’s objective is to track the performance of its benchmark index, currently the CRSP US Small-cap Growth Index. The fund invests in the component stocks of this index, which are small-capitalization domestic stocks with the potential for appreciation greater than the broader market. Small-cap stocks are inherently riskier than large-caps, so this fund is suitable for investors with a longer time horizon or those willing to take a bit more risk. Vanguard assigned a risk potential of 5 out of 5 to VISGX. This means the fund has the potential for very high returns but carries much higher risk when compared to the overall stock market.

The 10-year annualized rate of return for VISGX is 8.26%. Its dividend yield is 0.72%. It has earned a 4-star rating from Morningstar. The expense ratio is 0.10%, which is 83% lower than the average for similar funds. The minimum investment is $3,000 for both IRAs and general accounts.

The top three holdings of VISGX are MEDNAX, Inc., Signature Bank, and DexCom, Inc.


Best Vanguard Index Funds



Vanguard Mid-Cap Index Fund (VIMSX)


The fund’s objective is to track the performance of its benchmark index, currently the CRSP US Mid-cap Index. The fund invests in the component stocks of this index, which are medium-sized companies that still have growth potential greater than the general market, but are more mature and stable than small-cap stocks in comparable industries. This fund is less risky than a typical small-cap fund, but expected returns will be lower, all other factors being equal. Investors with an intermediate time horizon will find VIMSX to be a suitable investment for above-average growth over the medium term. Vanguard assigned a risk profile of 5 out of 5 to VIMSX. This means the fund has the potential for very high returns but carries much higher risk when compared to the overall stock market.

The 10-year annualized rate of return for VIMSX is 7.80%. Its dividend yield is 1.40%. It has earned a 5-star rating from Morningstar. The expense ratio is 0.18%, which is 80% lower than the average for similar funds. The minimum initial investment is $3,000 for both IRAs and general accounts.

The top three holdings of VIMSX are Avalon Bay Communities, Inc., Chipotle Mexican Grill, Inc., and Fiserv, Inc.


Best Vanguard Index Fund


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Vanguard Growth Index Fund (VIGRX)


The fund’s objective is to track the performance of its benchmark index, currently the CRSP US Large-cap Growth Index. The fund invests in the component stocks of this index, which are large cap stocks with the potential to grow more quickly than the average large-cap stock. The risk of a large-cap portfolio is that it may lag behind smaller growth stocks or the broader stock market, depending on economic conditions. In addition, large caps are often multinational and may be affected by currency exchange rates or the impact of world political or economic crises. Vanguard assigned a risk potential of 4 out of 5 to VIGRX. This means the fund has the potential for higher than average reward offset by a higher than average risk when compared to the overall stock market.

The 10-year annualized rate of return for VIGRX is 8.70%. Its dividend yield is 1.13%. It has earned a 4-star rating from Morningstar. The expense ratio is 0.18%, which is 81% lower than the average for similar funds. The minimum investment is $3000 for both IRAs and general accounts.

The top three holdings of VIGRX are Apple, Inc., Google, Inc., and Facebook, Inc.


Vanguard Best Index Funds



Best Vanguard Index Funds Conclusion


With more than 15,000 mutual funds to choose from in the United States, picking the right funds for a portfolio can be a confusing and daunting task. Investing only in index funds greatly narrows the pool of funds to choose from and reduces the management risk inherent with actively managed funds. Reputable fund families whose index funds have solid track records and demonstrate returns that consistently beat those of competitors are also recommended. Vanguard (read review) is a leader in passively managed index funds and is worth your consideration.


Best Vanguard Index Funds reviewed by Brokerage-Review.com. Rating: 5