Mutual funds
Build your legacy with high-quality, low-cost mutual funds that fit your needs.
What's a mutual fund?
A mutual fund is a collection of investors' money that fund managers use to invest in stocks, bonds, and other securities.
Why invest in mutual funds?
Mutual funds can be particularly suitable for investors seeking long-term, tax-deferred growth in retirement accounts.
Low costs
Our average expense ratio across our mutual funds and exchange-traded funds (ETFs) is ${cf.tokens.expense-ratios.lessThanVgMFandETFindAvgPercent} lower than the industry average.*
Less risk through diversification
Mutual fund diversification helps reduce risk by spreading your investment across a range of securities, so underperformance in one area can be offset by better performance in others.
Professional management
You don't have to keep track of every security your mutual fund owns. The fund is managed by experts who take care of that for you, so you're free to focus on other things.
Convenience
You can buy and sell mutual fund shares online and set up recurring investments and withdrawals.
Vanguard mutual fund options
Vanguard offers a range of mutual funds to invest in, designed to serve different investment goals and risk tolerances. Here's an overview of our 4 main types of mutual funds.
Index funds
Enjoy the benefits of diversification, tax efficiency, and low costs with index mutual funds.
Actively managed funds
Our careful selection of talent, paired with our consistent investment approach and client-first focus, sets our actively managed mutual funds apart.
Target Retirement Funds
You make just one decision, and the fund's managers maintain the target risk and handle rebalancing for you.
ESG funds
Invest in what matters to you. Our ESG (environmental, social, governance) funds allow you to invest in funds that align with your personal preferences.
Mutual funds vs. ETFs
Mutual funds and ETFs (exchange-traded funds) are similar in many ways, but there are a few key differences that set them apart.
ETFs
An ETF is a collection of hundreds or thousands of stocks, bonds, or other securities, managed by experts, in a single fund that trades on major stock exchanges.
- You can buy and sell ETFs throughout the trading day and get real-time pricing, just like stocks.
- Vanguard ETFs have a $1 investment minimum. Minimums for all other ETFs are set at the share price.
- ETFs are generally more tax-efficient than mutual funds.
- We offer both index and actively managed ETFs.
Mutual funds
A mutual fund is a collection of stocks, bonds, or other securities, managed by experts, in a single fund that's bought and sold at the end of each trading day based on its net asset value (NAV).
- You can place buy or sell orders for mutual funds throughout the trading day. However, these trades are processed and priced at the end of the day at NAV.
- Investment minimums can range from $1,000 to $50,000, depending on the fund.
- Mutual funds are generally less tax-efficient than ETFs.
- We offer both index and actively managed funds.
2 ways to open an investment account
Do it yourself
Both industry experts and everyday people rely on our high-performing,* low-cost mutual funds and ETFs. Choose from diverse investments to save for your financial goals.
Explore professional advice
Whatever you're working toward, we have a range of services to help you get there. Get a personalized plan and judgment-free guidance to keep you on track.
Resources for Mutual funds
Frequently asked questions
What else should I know about mutual funds?
In order to purchase a mutual fund, you'll need to open an account if you don't have one already. When it comes to researching mutual funds, some basic things to consider are the fund's expense ratio and your target asset allocation—the combination of stocks, bonds, and cash you should hold in your portfolio.
How do I decide which mutual fund to pick?
Start with your savings goals to get an idea of how aggressive you want your investments to be based on your risk tolerance and how long you'd like your money to be invested. Then determine the best asset allocation for your goals, and select a mutual fund to help build your diversified portfolio. Once you identify your investment time horizon and your portfolio's allocation, you might also want to consider whether you want an index fund or an actively managed fund.
What's the difference between active and index mutual funds?
Index funds, also known as passively managed funds, are built to follow a market benchmark like the S&P 500 Index or Dow Jones Industrial Average. Active funds are managed by fund managers who handpick the fund's investments in an attempt to beat the market.
What's NAV?
You’ll often see the phrase "mutual funds trade at NAV" or the word "NAV" when you research mutual funds. NAV stands for net asset value—it's the price per share that you buy the mutual fund for. The NAV is calculated at the end of the trading day.