Vanguard Healthcare Admiral Funds Performance Metrics and Analysis

The Vanguard Healthcare Admiral Funds are a popular choice for those looking to invest in the healthcare industry. These funds offer a diversified portfolio of stocks and bonds, with a focus on long-term growth.

The Admiral Shares class of the Vanguard Healthcare Fund has a 0.10% expense ratio, which is lower than the Investor Shares class. This is a significant advantage for investors, as it means more of their money can go towards returns rather than fees.

The fund's top holdings include Johnson & Johnson, UnitedHealth Group, and Pfizer, which are well-established companies in the healthcare industry. These companies have a proven track record of stability and growth.

The Vanguard Healthcare Admiral Fund has delivered strong returns in recent years, with a 5-year annualized return of 13.3%. This is a testament to the fund's diversified portfolio and the expertise of its managers.

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The Vanguard Health Care Index Admiral fund has a strong track record, with a 13.1% annualized gain through September 2024 outpacing its primary prospectus MSCI ACWI Health Care benchmark's 11.4%. This is a testament to the team's expertise and investment strategy.

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The fund's performance has been mixed in 2024, with a 12.2% cumulative return trailing the index's 14.1% but beating the typical health Morningstar Category peer's 10.6%. This is largely due to the team's investment in Eli Lilly, which gained over 50% during that period.

The fund's expense ratio is a notable advantage, with a low 0.10% expense ratio that is 92% lower than its category average. This is a significant benefit for investors, as high annual expense ratios can reduce returns.

The Vanguard Health Care Fund Admiral Shares has delivered impressive results under the lead management of Jean Hynes since 2013, with a 13.1% annualized gain outpacing its primary prospectus MSCI ACWI Health Care benchmark's 11.4%. However, it slightly lagged the S&P 1500 Health Care category index's 14.2%.

In 2024, the strategy's 12.2% cumulative return trailed the index's 14.1%, but beat the typical health Morningstar Category peer's 10.6%. The team's investment in Eli Lilly was a significant contributor, as the stock continued its impressive run, gaining over 50% during that period.

The strategy's limited exposure to unprofitable, small-cap biotech stocks often causes it to lag during speculative market rallies, but provides downside protection during downturns. Across seven market drawdowns during Hynes' tenure, the strategy held up well relative to both the index and the typical peer, delivering competitive down-capture ratios of 93% and 68%, respectively.

The fund's expense ratio is a mere 0.10%, which is 92% lower than its category average, earning it an A grade. This low expense ratio is a significant advantage over other funds in the Health category.

Here are some key statistics about the fund's management team:

The fund's performance has been consistent, with a portfolio turnover rate of 4%, indicating that it holds its assets for around 0.3 years. This is significantly lower than the average portfolio turnover of 49% for the Health category.

The fund's return of 6.8% in January 2025 earned it an A grade, as the Health category had an average return of 5.7%.

The Vanguard Health Care Index Admiral fund is a passively managed Sector Equity Health fund that seeks to track the performance of the MSCI US Investable Market Index (IMI)/Health Care 25/50. It was launched by Vanguard in 2004.

The fund employs an indexing investment approach to replicate the target index, which is made up of stocks of large, mid-size, and small U.S. companies within the health care sector.

The Vanguard Health Care Index Admiral fund has a management team with an average tenure of 8.15 years, consisting of Walter Nejman and Michelle Louie. The fund meets the SEC requirement of being classified as a diversified fund.

The fund has a primary benchmark, the MSCI US IMI/Health Care 25-50 GR USD index, with a weighting of 100%. It holds 419 securities in its portfolio, with the top 10 holdings constituting 47.2% of the fund's assets.

Here's a breakdown of the fund's allocation:

The fund has an expense ratio of 0.10% and a category expense grade of A, indicating it is low within its category.

Vanguard Health Care Index Admiral (VHCIX) is a passively managed Sector Equity Health fund launched by Vanguard in 2004. It tracks the performance of the MSCI US IMI/Health Care 25-50 GR USD index.

The fund employs an indexing investment approach, seeking to replicate the target index by investing in the stocks that make up the index in the same proportion as their weighting in the index. This approach is designed to minimize costs and maximize returns.

The fund has a management team with an average tenure of 8.15 years, consisting of Walter Nejman (2015) and Michelle Louie (2017). The team's experience and stability are essential for maintaining the fund's performance.

Vanguard Health Care Index Admiral has 419 securities in its portfolio, with the top 10 holdings constituting 47.2% of the fund's assets. The fund meets the SEC requirement of being classified as a diversified fund.

The fund's stock sector breakdown is as follows:

The fund's allocation to domestic stock is 97.2%, with 0.3% allocated to foreign stock. The bond allocation is 0.0%, and the cash allocation is 2.5%.

The Vanguard Healthcare Admiral fund has a significant focus on the healthcare sector, with 44.5% of its assets invested in the top 10 holdings.

The current portfolio date is June 30, 2025, indicating that the information is up-to-date as of that date.

Here are the top 10 holdings of the fund, sorted by portfolio weight:

Assets Under Management is a crucial factor to consider when evaluating a fund's performance. The Vanguard Health Care Index Admiral fund has $2 billion in total assets, which is above the category average of $894 million.

This large asset base may seem beneficial, but it can also limit the manager's ability to fully employ their active strategy, particularly in categories like small-cap investing where quick growth can be challenging.

The fund's size also affects its expense ratio, but in this case, it has a relatively low expense ratio compared to its category average.

A larger asset base can also impact the fund's dividend yield, which is a key consideration for income-seeking investors. The Vanguard Health Care Index Admiral fund has a trailing dividend yield of 1.43%, which is significantly higher than the category average of 0.36%.

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The portfolio holdings of VGHAX are quite interesting. The current portfolio date is June 30, 2025.

The majority of the portfolio is invested in healthcare stocks, with 44.5% of assets in the top 10 holdings. This suggests a focused approach to investing.

The top 10 holdings of VGHAX are dominated by healthcare stocks, with all but one of the top holdings belonging to this sector. This is evident from the table below:

Each of the top holdings has a significant market value, ranging from 971 million to 4 billion USD.

The Vanguard Health Care Fund Admiral Shares has provided a consistent source of returns and dividends for investors.

In terms of monthly returns, the fund has shown a range of performance over the years. The worst performing month was December 2024, with a return of -6.68%. On the other hand, the best performing month was August 2024, with a return of 5.24%.

The fund's dividend yield has also been impressive. Over the last twelve months, the dividend yield was 9.62%, with an annual payout of $7.54 per share. This is a significant return on investment for shareholders.

One notable trend in the fund's dividend history is the increase in distributions over the past two years. The annual payout has risen from $0.78 in 2023 to $7.54 in 2024.

Here is a summary of the fund's dividend history over the past 12 years:

The fund's dividend yield has fluctuated over the years, but it has consistently provided a higher yield than many other investment options.

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The Vanguard Health Care Fund Admiral Shares has delivered impressive returns over the years, with a 13.1% annualized gain through September 2024 outpacing its primary prospectus MSCI ACWI Health Care benchmark's 11.4%.

The team's strategy has been to overweight non-US healthcare stocks, which has sometimes hurt the fund's relative performance, but this is a global strategy after all.

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In 2024, the strategy's 12.2% cumulative return trailed the index's 14.1%, but still beat the typical health Morningstar Category peer's 10.6%.

A significant contributor to the fund's success in 2024 was its investment in Eli Lilly, which gained over 50% during that period.

The team's decision to keep a modest position in Moderna, despite its unprofitable status, was based on its long-term potential for vaccine development.

The Vanguard Health Care Fund Admiral Shares has a relatively low exposure to unprofitable, small-cap biotech stocks, which can sometimes cause it to lag during speculative market rallies, but provides downside protection during downturns.

According to the Drawdowns chart, the fund has delivered competitive down-capture ratios of 93% and 68% relative to the index and typical peer, respectively, across seven market drawdowns during Jean Hynes' tenure.

The fund's current volatility is 3.47%, representing the average percentage change in its value over the past month, as shown in the Volatility chart.

The Performance Chart shows the growth of an initial investment of $10,000 in the Vanguard Health Care Fund Admiral Shares, comparing it to the performance of the S&P 500 index or another benchmark, with all prices adjusted for splits and dividends.

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The Vanguard Health Care Fund Investor (VGHCX) has $48.7 billion in assets under management.

VGHCX has a low expense ratio of 0.32% and a dividend yield of 1.0%.

The fund takes a broad approach to health care, investing in various sectors both in the U.S. and abroad. Pharmaceutical stocks make up 40% of the portfolio.

A good third of the portfolio is in international stocks, giving investors diversification and potentially reducing risk.

Here's a comparison of the two funds mentioned in the article:

VGHCX's 10-year average annual return is 14.9%, which is about 60 basis points lower than the category average.

When evaluating the Vanguard Healthcare Admiral Funds, risk management is a crucial aspect to consider. Risk-Adjusted Performance Indicators are used to evaluate the fund's returns against its associated risks.

These indicators are presented in charts that compare Vanguard Health Care Fund Admiral Shares (VGHAX) to a chosen benchmark (^GSPC). The charts provide a visual representation of the fund's performance.

Investors can use these risk-adjusted metrics to make informed decisions about their investments, taking into account the potential risks and rewards of the fund.

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The Vanguard Health Care Fund Admiral Shares has a risk-adjusted performance rank of 6, meaning it's performing worse than 94% of other mutual funds on our website. This is a significant statistic, and it's essential to understand what it means.

The fund's Sharpe ratio is -0.23, which is a measure of its risk-adjusted returns. A negative Sharpe ratio indicates that the fund's returns have been lower than expected, given its level of risk.

Here's a breakdown of how the Vanguard Health Care Fund Admiral Shares compares to its peers in terms of risk-adjusted performance:

As you can see, the Vanguard Health Care Fund Admiral Shares has a relatively low Sharpe ratio, indicating that its returns have been lower than expected. However, it's essential to consider the fund's overall performance and risk profile before making any investment decisions.

The fund's risk-adjusted performance is just one aspect to consider when evaluating its potential. It's also essential to look at its expense ratio, portfolio turnover rate, and investment strategy to get a comprehensive understanding of its performance.

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Understanding Worst Drawdowns is crucial for effective risk management. The Vanguard Health Care Fund Admiral Shares experienced a maximum drawdown of 45.79% on March 5, 2009, which was a significant reduction in portfolio value.

This drawdown occurred after a long period of decline, starting on May 8, 2007, and lasted for 1343 trading sessions, with the fund recovering by September 6, 2012. The fund's drawdowns are a measure of risk, indicating the largest reduction in portfolio value due to a series of losing trades.

The table below displays the maximum drawdowns of the Vanguard Health Care Fund Admiral Shares, providing a clear picture of the fund's worst performance periods.

The table highlights the fund's worst drawdowns, providing valuable insights into its risk exposure. By understanding these worst-case scenarios, investors can make informed decisions about their investment portfolios.