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5 Defensive Funds to Guard Your Nest Egg

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Vanguard LifeStrategy Conservative Growth Fund

Vanguard mutual funds 401(k)If you are looking for a conservative index fund with a low expense ratio, then the Vanguard LifeStrategy Conservative Growth Fund (VSCGX) might be a perfect fit.

The fund sticks to a rigid allocation of 28% domestic stocks, 12% international stocks, 48% domestic bonds, and 12% international bonds. This 40/60 allocation of stocks and bonds is widely considered to be a conservative asset allocation benchmark.

One of the advantages of owning a balanced fund is that the volatility in bonds and stocks offset each other, which creates a smooth price trend. While you give up the potential for higher returns, you also gain the assurance that you will not experience as much draw-down as a typical stock-only index.

One of the most attractive qualities of VSCGX is its 0.15% expense ratio, which is one of the lowest in the industry. Vanguard always has been known as a company that will stand behind low-cost index strategies for its investors.

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