3 Vanguard Upgrades
Russ Kinnel highlights three funds you won't want to miss.
Russel Kinnel: Vanguard is a leader in costs and fund design, so they tend to draw high ratings from us. We recently upgraded three of their funds.
These Vanguard funds earn a Morningstar Analyst Rating of Silver or Gold.
Vanguard Short-Term Inflation-Protected Securities Index is just about a perfect inflation hedge. TIPS adjust their value in response to changes in the Consumer Price Index. By limiting itself to short-term TIPS, the fund avoids most of the interest-rate risk in TIPS. In 2022, those risks were really realized as inflation and interest rates spiked at the same time, leaving long-term TIPS funds deep in the red. This fund’s overall rating is Gold.
We raised Vanguard Extended Market Index from Bronze to Gold. The fund targets the rest of the market left over after the S&P 500. Thus, you have a wide-ranging and very cheap fund. It works to complete a portfolio that already has an S&P 500 index fund, or you can just use it to gain low-cost exposure to small- and mid-caps even if you don’t have the S&P 500.
Finally, we raised Vanguard Global Wellesley Income (VGYAX)’s Process rating from Average to Above Average, leading to an overall upgrade from Bronze to Silver. Vanguard launched this global version of the investor favorite Wellesley Income in 2017. The two funds are pretty similar, but the Global fund has a little more lower-quality debt and, of course, more global equities and bonds. Still, we’re pleased with what we’ve seen in the process so far and how it’s executed. As interest rates have risen, so has this fund’s yield, making it a gem for income-oriented investors.
Watch 3 Great Global Funds for more from Russel Kinnel.