The top three mutual fund holders of Alphabet Inc. (GOOG/GOOGL) stock include the Vanguard Total Stock Market Index Fund, Vanguard 500 Index Fund, and the American Funds Growth Fund of America. Together, the mutual funds own more than 5% of Alphabet's outstanding shares.
Alphabet became the parent holding company for Google on October 2, 2015. One reason for this restructuring was to enable Alphabet's several subsidiaries to have a more focused view on their businesses. As a result, Alphabet reports its earnings in two segments: in "Google," which includes Android, Chrome, and YouTube, and also in "Other Bets," which includes CapitalG, Waymo, and X. As of October 2, 2019, Alphabet has a market cap of $817.8 billion.
- Alphabet, the parent company of Google, Inc., is one of the world's most valuable companies by market cap and is a household name with a global presence.
- Because it is such a dominant stock and component of several broad market indices, Alphabet shares are held by large mutual funds that have both passive and active strategies.
- Here we look at just the top 3 mutual fund shareholders of Alphabet stock, two of which are Vanguard (1 passive and 1 active) and the third an active fund by American Funds.
Vanguard Total Stock Market Index Fund (VTSMX)
The Vanguard Total Stock Market Index Fund (VTSMX), launched in 1992, aims to reflect the performance of the overall stock market by acting as a benchmark index. VTSMX is the largest mutual fund holder of Alphabet and owns just over 8 million shares of the company as of October 2, 2019. This accounts for 2.32% of total shares held.
For that same period, VTSMX has $827.1 billion in assets under management (AUM), an expense ratio of 0.14%, a turnover ratio of just 3%, and requires a minimum investment of $3,000. Alphabet accounts for 2.4 % of VTSMX's total assets (between class A & C shares - i.e. GOOG & GOOGL).
Vanguard 500 Index Fund (VFINX)
Founded in 1976, the Vanguard 500 Index Investor (VFINX) acts a benchmark index and its main focus is on large-cap stocks. Its investment strategy is that of a passively managed fund as it tracks the performance of the S&P 500. VFINX is the second-largest mutual fund holder of Alphabet with just under 6 million shares as of October 2, 2019. This accounts for 1.71% of total GOOG shares held by investors, and GOOG + GOOGL make up 3% of VFINX's portfolio.
As of October 2, 2019, VFINX has $494 billion in AUM, an expense ratio of 0.14%, a turnover ratio of 4%, and requires a minimum investment of $3,000.
American Funds Growth Fund of America (AGTHX)
American Fund's Growth Fund of America (AGTHX) was established in 1973 its stated investment aim is capital appreciation. Stocks are selected for inclusion based on fundamental analysis of the company, the industry the company is engaged in and overall economic conditions. The fund's manager seeks to identify stocks that are undervalued or offer above-average growth potential. AGTHX invests in both U.S. and foreign stocks.
AGTHX is the third-largest mutual fund holder of Alphabet with 3.65 million shares as of October 2, 2019. AGTHX's investment in Alphabet accounts for 2% of its total fund assets and it holds 1.05% of total shares in Alphabet. As of October 2, 2019, AGTHX has $181.5 billion in AUM, an expense ratio of 0.62%, a turnover ratio of 28%, and requires a minimum investment of $250. AGTHX, as it is actively managed, has a sales load of 5.25%.