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Vanguard's 6 Riskiest Funds

January 26, 2009

By Dan Wiener, Editor, Independent Adviser for Vanguard Investors

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Dan Wiener

Dan Wiener

Daniel P. Wiener is America's leading expert on investing in Vanguard mutual funds and is editor of The Independent Adviser for Vanguard Investors, a monthly newsletter that keeps abreast of recent developments at Vanguard. The Adviser is a five-time winner of the Newsletter Publishers Foundation's Editorial Excellence Award.

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If you own any Vanguard funds, please read this carefully. Several of Vanguard’s biggest, most popular funds are among the most vulnerable you can own now.

They are overexposed to the huge risks of the stock market as a whole.

Some are overexposed in technology — often because they are handcuffed to one of the tech-heavy indexes. Yet these are not what any investor would have thought of as "technology funds!"

Some have inexperienced managers, or management-by-committee, which invariably leads to mediocrity.

Some were excellent funds when they were smaller, but they’ve grown unwieldy. They can’t make the nimble turns that they used to be able to make, which means they sail right into trouble!

And some appear to offer fair returns, except when you examine their after-tax results, which turn out to be terrible.

In each case, you’d be much better off in other Vanguard funds. Better off and safer, too!

Sell these funds now. Not tomorrow. Not next week. Now, today.

Rank
Fund
Maximum
Cumulative Loss
1
2
3
4
5
6
Information Technology
Telecom Services Index
U.S. Growth
Precious Metals & Mining
Growth Equity
MidCap Growth
-81.2%
-77.9%
-70.6%
-68.9%
-68.7%
-59.9%

 

 

 

 

 

 

NOTE: These Vanguard funds are part of a new report just released by Dan Wiener called 25 Vanguard Funds to Sell Immediately. Dan strongly recommends selling each of these funds right away. So don’t wait! Click here to download this report now.

See How Risky Your Funds Really Are in 5 Seconds

Too many Vanguard investors believe that their funds carry little if any risk, at least over the proverbial long haul. Nothing could be further from the truth.

What Vanguard management doesn’t want you to know is that many Vanguard funds are EXTREMELY risky. In fact, they could spell disaster for your portfolio if you’re not careful.

For example, you might expect that Information Technology Index, like all sector funds, would have extreme volatility. But what about Midcap Growth? Or U.S. Growth?

Even more important…