Any investors hoping to find a Government – Bonds: Misc fund might consider looking past Vanguard Inflation Protected Securities Fund (VIPSX). VIPSX carries a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.

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We classify VIPSX in the Government – Bonds: Misc category, an area rife with potential choices. Government – Bonds: Misc funds hold securities issued by the federal government of the United States of America. These are seen as extremely low risk securities from a default perspective, and are often regarded as risk-free assets. This category stretches across the curve, so the yields and interest rate sensitivity will vary, though a mixed approach generally results in a medium yield and risk profile.

Vanguard Group is based in Malvern, PA, and is the manager of VIPSX. Vanguard Inflation Protected Securities Fund debuted in June of 2000. Since then, VIPSX has accumulated assets of about $2.26 billion, according to the most recently available information. The fund is currently managed by John Madziyire who has been in charge of the fund since November of 2021.

Of course, investors look for strong performance in funds. VIPSX has a 5-year annualized total return of 2.1% and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -1.85%, 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.

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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 11.99%, the standard deviation of VIPSX over the past three years is 7%. The fund’s standard deviation over the past 5 years is 6.21% compared to the category average of 12.44%. This makes the fund less volatile than its peers over the past half-decade.

This fund has a beta of 0.55, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, VIPSX has a positive alpha of 1.74, which measures performance on a risk-adjusted basis.

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, VIPSX is a no load fund. It has an expense ratio of 0.20% compared to the category average of 0.82%. VIPSX is actually cheaper than its peers when you consider factors like cost.

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