The table below in this article presents The Skilled Investor’s Fund Authority Score and other information for the Vanguard Institutional Index Fund.
The diversified investment fund strategy of the Vanguard Institutional Index mutual fund (VINIX)
According to its prospectus filing on the U.S. Securities and Exchange Commission EDGAR system, the investment strategy of the Vanguard Institutional Index Fund is to “employ a ‘passive management’ – or indexing – investment approach designed to track the performance of the Standard & Poor’s 500 Index, a widely recognized benchmark of U.S. stock market performance that is dominated by the stocks of large U.S. companies. The Fund attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the Index, holding each stock in approximately the same proportion as its weightings in the Index.”
The annual management fee or expense ratio for the Vanguard Institutional Index Fund is a rock botttom .05% per year. Unfortunately, most individual investors would find the $5,000,000 initial investment requirement a bit challenging. The Skilled Investor has prepared a Fund Authority Score report for this VINIX fund for individuals who own it indirectly. This index mutual fund held $73.8 Billion in late 2007, and it is widely held by individuals who hold shares in traditional IRAs, Roth IRAs, 401k, and other retirement plans or pension plans.
Clearly, Vanguard is delivering an extremely low cost large capitalization S&P 500 index mutual fund. The challenge that most investors will have is to understand the add-on fees that they pay for indirect ownership of the Vanguard VINIX index mutual fund. Often, retirement plan management fees and other plan fees are excessively high and are poorly disclosed. If your retirement plan managers have the good sense to offer such a low cost S & P 500 index mutual fund, then the hope is that they also had the good sense to keep down your other investment plan costs, too. Nevertheless, it does not hurt to verify your true costs and to raise questions about fees that you believe are too high or unjustified. It is your retirement money and repeating fees can be a huge drain on your retirement portfolio. See this article: The heavy burden of recurring investment fees.
Fund Authority Scores for mutual funds and exchange traded funds (ETFs) help you sort diversified investment funds quickly.
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