Vanguard MidCap Value Index Fund Admiral: A Comprehensive Guide

Introduction

The Vanguard MidCap Value Index Fund Admiral (VIVAX) is a mutual fund that invests in medium-sized companies with undervalued stock prices. It is a passively managed fund that tracks the performance of the S&P MidCap 400 Value Index. The fund has a long-term track record of outperforming its benchmark and has been a popular choice for value investors.

Investment Objective

The investment objective of the Vanguard MidCap Value Index Fund Admiral is to provide long-term capital appreciation by investing in a diversified portfolio of medium-sized companies with value-oriented characteristics.

Investment Strategy

The fund invests in a portfolio of approximately 340 medium-sized companies that are selected for their value characteristics. Value companies are typically those that have low price-to-earnings (P/E) ratios, low price-to-book (P/B) ratios, and high dividend yields. The fund uses a quantitative model to select stocks that are undervalued relative to their intrinsic value.

Performance

The Vanguard MidCap Value Index Fund Admiral has a long-term track record of outperforming its benchmark. Over the past 10 years, the fund has returned an average of 10.2% per year, compared to 9.6% for the S&P MidCap 400 Value Index.

Fees

The Vanguard MidCap Value Index Fund Admiral has an expense ratio of 0.05%, which is one of the lowest in the industry. This means that for every \$10,000 invested in the fund, you would pay \$5 in annual fees.

Tax Efficiency

The Vanguard MidCap Value Index Fund Admiral is a tax-efficient fund. It has a low turnover rate, which means that it does not sell stocks frequently. This reduces the amount of capital gains that are distributed to shareholders, which can save you money on taxes.

Risk

The Vanguard MidCap Value Index Fund Admiral is a moderately risky fund. It invests in mid-sized companies, which are typically more volatile than large-cap companies. However, the fund's value orientation helps to reduce some of the risk associated with investing in mid-caps.

Suitable Investors

The Vanguard MidCap Value Index Fund Admiral is a suitable investment for investors who are looking for a long-term, value-oriented investment. The fund is appropriate for investors who have a moderate risk tolerance and are willing to accept some volatility in their portfolio.

How to Invest

You can invest in the Vanguard MidCap Value Index Fund Admiral through Vanguard or through a financial advisor. You can open an account online or by phone. The minimum investment amount is \$3,000.

Conclusion

The Vanguard MidCap Value Index Fund Admiral is a solid investment choice for investors who are looking for a value-oriented fund with a long-term track record of outperformance. The fund has a low expense ratio and is tax-efficient. It is a suitable investment for investors who have a moderate risk tolerance and are willing to accept some volatility in their portfolio.

Additional Information

• The Vanguard MidCap Value Index Fund Admiral is available in both Admiral and Investor share classes. The Admiral share class has a lower expense ratio than the Investor share class, but it also has a higher minimum investment amount.
• The fund is also available in a retirement account, such as an IRA or 401(k).
• You can learn more about the fund by visiting the Vanguard website or by talking to a financial advisor.

Key Features

• Investment Objective: Long-term capital appreciation
• Investment Strategy: Invests in medium-sized companies with value-oriented characteristics
• Benchmark: S&P MidCap 400 Value Index
• Expense Ratio: 0.05%
• Minimum Investment: \$3,000
• Suitable Investors: Investors with a moderate risk tolerance and a long-term investment horizon

Benefits

• Long-term outperformance: The fund has a long-term track record of outperforming its benchmark.
• Low fees: The fund has one of the lowest expense ratios in the industry.
• Tax efficiency: The fund's low turnover rate helps to reduce capital gains distributions.
• Diversification: The fund invests in a diversified portfolio of mid-sized companies.

Risks

• Market risk: The fund is subject to the risks of the overall stock market.
• Company risk: The fund invests in individual companies, which are subject to their own risks.
• Value investing risk: Value stocks can underperform growth stocks in certain market conditions.

Common Mistakes to Avoid

• Investing for the short term: The fund is designed for long-term investors. Investing for the short term can increase your risk of losing money.
• Trying to time the market: The fund is not designed to be used for market timing. Trying to time the market can lead to poor returns.
• Investing more than you can afford to lose: The fund is a moderately risky investment. You should only invest an amount that you can afford to lose.

Tables

Table 1: Fund Performance

Table 2: Fund Fees

Table 3: Fund Risk Profile

Table 4: Fund Holdings