Vanguard Institutional IndexVINIX

Morningstar Rating

Fund Research and Analysis

by Dan Culloton

Vanguard Institutional Index is a good deal.

The fund, though still among the largest in the fund industry, has been surpassed in popularity by other options that include more mid- and small-cap exposure, such as Vanguard Institutional Total Stock Market Index VITNX. Read more

Kudos

Low costs.

Wide diversification.

High tax efficiency.

Solid long-term track record. Read more

Risks

Huge median market cap may cause the fund to lag during small-cap rallies. Read more

Strategy

The core of the fund's strategy is simple: Manager Donald Butler buys and holds the stocks that comprise the S&P 500 Index. Butler attempts to add value on the margins by opportunistically buying futures contracts, among other strategies, and he actively pursues ways to reduce trading costs. Read more

Management

Donald Butler, who joined Vanguard in 1992, has been involved with the day-to-day management of this fund since 2000 and has been lead manager since 2005. Read more

Inside Scoop

This fund offers extremely low-cost, broadly diversified exposure to domestic blue chips. Its tiny expense ratio gives it a huge advantage. Active managers have had a hard time beating this fund over the long haul. Read more

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