Good Vanguard Mutual Funds

Good Vanguard Mutual Funds

I recently wrote about some good American Fund Mutual Funds so I decided to research some other good mutual funds. I am now going to give some information about the Vanguard series of mutual funds. In my opinion, as you are looking at mutual funds, you should be looking at funds that have been around at least 10 years, have had growth in at least 70% of the years since the funds inception and has averaged 10-12% growth since.

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Good Mutual Funds

Here are the top Vanguard funds that I found, I admit that I did not do in depth research so there could be some better funds available. Before you invest in any funds, you should do some research yourself and consult a professional. I am just listing these funds to give you some ideas.

Vanguard 500 Index (VFINX) began on August 31, 1976. Through December 31, 2008 this fund had growth in 25 years and losses in 7 years. That means 78% of the years since its inception, this fund has had years with growth. The average annual growth of this fund since inception is 9.30%.

Vanguard Wellesley Income (VWINX) began on July 1 ,1970. This fund has had growth in 32 years and losses in 6 years. That means 84% of the years since it's inception, this fund has had years with growth! The average annual growth of this fund is 9.69%.

Vanguard U.S. Growth (VWUSX) began on January 6, 1959. This fund has had growth in 36 years and losses in 13 years. That calculates to 73% of the years since its inception, this fund has had years with growth. The average annual growth of this fund since inception is 9.16%.

Vanguard Windsor (VWNDX) began on October 23, 1958. This fund has had growth in 40 years and losses in 10 years. That means 75% of the years since its inception, this fund has had years with growth. The average annual growth of this fund is 10.33%.

Vanguard Wellington (VWELX) began on July 1, 1929. That means this fund began BEFORE the stock market crash of 1929. It survived that crash, the depression, World War II, Korea, Vietnam, President Kennedy's assassination, President Nixon's resignation and many more incidents that affected the United States and the world. Just the fact that this fund survived is impressive to me. Through all of that turmoil, this fund still had 61 years with growth and only 18 years with losses. That means 77% of the years since the inception of this fund, it has had years with growth. The average annual rate of growth is 7.79%.

While only one of these funds falls in the category of 10-12% average growth over the life of the fund, these are still pretty good mutual funds. These funds have been around a long time and have weathered some difficult financial situations. They are certainly worth considering as you look into investing.

Comments 3 comments

Ralph Deeds profile image

Ralph Deeds 7 years ago

Nice hub, Art!

Vanguard was the first company to offer no load, low cost, tax-efficient index mutual funds. In my opinion they set the standard for the mutual fund industry (which is filled with companies whose primary interest is to make money for themselves, not the investors in their funds. In the past several years many of them have been caught and fined for various actions which were not in the interest of investors in their funds. For example--

-charging excessively high management fees and loads (commissions required to buy the funds). Some brokers will try to justify high load fees (their source of income) by saying "You get what you pay for, i.e., the results will be better. This is pure b.s.!

-allowing after market close trading by favorored (big) customers (equivalent to allowing a bet on a horse race after the race is over),

-front running by fund managers, i.e., buying up stocks for their own personal accounts in advance of big purchases of the same stocks by the funds they are supposed to be managing in the interest of fund investors, and

-allowing fund managers/traders to accept expensive gifts from brokers in return for sending them trades by their fund (instead of seeking out the brokers who do the best job of executing trades for the fund). 

If you want to find out more about abuses by many big name mutual funds get a copy of David F. Swensen's book "Unconventional Success." He's a believer in Vanguard no-load, low cost, tax efficient index mutual funds.

John Bogle, Vanguard's founder, recenly said that he recommends splitting your portfolio between government bonds and no load stock mutual funds, with the bond portion equal to your age. That is if you're 50, bonds should comprise 50% of your investment portfolio. [I really wish I'd started following that advice a couple of years ago. But I didn't. Water under the bridge!] I recall reading somewhere that the bond component can be lower if your'e lucky enough to have a secure, well funded defined benefit pension the bond component of your portfolio can be lower. Another consideration is whether your savings are in an IRA or 401k or in a taxable account. But that's another subject.


Art West profile image

Art West 7 years ago from Indiana Author

Thanks for the comment and the information Ralph.


Bill 5 years ago

When my father in law passed he had a trust with money in American Funds When I tryed to help my mother in law change the fund to her name and put it into her new trust I had a difficult time with American Fund. They wouldn't recognize the trust my father in law had with them. They wanted me to hire a lawyer to certify that my father in laws trust had not been amended to disinherit my mother in law. Of course this is impossible to prove because its not a public record. I tryed to close the account and send proceeds to mother in law and they refused. I finally signed on internet and withdrew all the money online. They in formed me I would have to pay a low balance fee. Fortunately I never heard from them again and I let everyone I know to never buy into American Funds

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