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Avoid These 3 Mutual Fund Misfires - October 08, 2019
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You may need to start looking for a new financial advisor if your current one has put any of these high-fee, low-return "Mutual Fund Misfires of the Market" into your portfolio.
How can you tell a good mutual fund from a bad one? It's pretty basic: If the fund has high fees and performs poorly, it's not good. Of course, there's a range - but when a mutual fund earns a Zacks Rank of #5 (Strong Sell) that means it's among the worst of roughly 19,000 funds we rate each day.
First, let's break down some of the funds currently part of our "Mutual Fund Misfires of the Market." If you happen to have put your money into any of these misfires, we'll help assess some of our best Zacks Ranked mutual funds.
3 Mutual Fund Misfires
Now, let's take a look at three market misfires.
Third Avenue Value Fund Institutional (TAVFX - Free Report) : 1.15% expense ratio and 0.9% management fee. TAVFX is a Small Cap Value mutual fund option, which typically invest in companies with market caps under $2 billion. With a five year after-costs return of -2.13%, you're for the most part paying more in charges than returns.
Templeton Foreign A (TEMFX - Free Report) : 1.06% expense ratio, 0.69% management fee. TEMFX is a part of the Non US - Equity fund category, many of which will focus across all cap levels, and will typically allocate their investments between emerging and developed markets. This fund has an annual returns of -2.22% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Longleaf Partners Fund (LLPFX - Free Report) - 0.97% expense ratio, 0.78% management fee. This fund has yielded yearly returns of -0.22% in the course of the last five years. Too bad!
3 Top Ranked Mutual Funds
There you have it: some prime examples of truly bad mutual funds. In contrast, here are a few funds that have achieved high Zacks Ranks and have low fees.
William Blair Growth N (WBGSX - Free Report) is a winner, with an expense ratio of just 1.2% and a five-year annualized return track record of 11.44%.
T. Rowe Price Cap Appreciation (PRWCX - Free Report) : Expense ratio: 0.71%. Management fee: 0.59%. PRWCX is categorized as an All Cap Value fund, and like the name suggests, invests across the cap spectrum in small-cap, mid-cap, and large-cap companies. PRWCX has managed to produce a robust 10.29% over the last five years.
Neuberger Berman Mid Cap Growth Trust (NBMTX - Free Report) has an expense ratio of 0.95% and management fee of 0.9%. NBMTX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With annual returns of 10.75% over the last five years, this fund is a well-diversified fund with a long track record of success.
Bottom Line
So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.
If you have concerns or any doubts about your investment advisor, read our just-released report:
Image: Bigstock
Avoid These 3 Mutual Fund Misfires - October 08, 2019
You may need to start looking for a new financial advisor if your current one has put any of these high-fee, low-return "Mutual Fund Misfires of the Market" into your portfolio.
How can you tell a good mutual fund from a bad one? It's pretty basic: If the fund has high fees and performs poorly, it's not good. Of course, there's a range - but when a mutual fund earns a Zacks Rank of #5 (Strong Sell) that means it's among the worst of roughly 19,000 funds we rate each day.
First, let's break down some of the funds currently part of our "Mutual Fund Misfires of the Market." If you happen to have put your money into any of these misfires, we'll help assess some of our best Zacks Ranked mutual funds.
3 Mutual Fund Misfires
Now, let's take a look at three market misfires.
Third Avenue Value Fund Institutional (TAVFX - Free Report) : 1.15% expense ratio and 0.9% management fee. TAVFX is a Small Cap Value mutual fund option, which typically invest in companies with market caps under $2 billion. With a five year after-costs return of -2.13%, you're for the most part paying more in charges than returns.
Templeton Foreign A (TEMFX - Free Report) : 1.06% expense ratio, 0.69% management fee. TEMFX is a part of the Non US - Equity fund category, many of which will focus across all cap levels, and will typically allocate their investments between emerging and developed markets. This fund has an annual returns of -2.22% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Longleaf Partners Fund (LLPFX - Free Report) - 0.97% expense ratio, 0.78% management fee. This fund has yielded yearly returns of -0.22% in the course of the last five years. Too bad!
3 Top Ranked Mutual Funds
There you have it: some prime examples of truly bad mutual funds. In contrast, here are a few funds that have achieved high Zacks Ranks and have low fees.
William Blair Growth N (WBGSX - Free Report) is a winner, with an expense ratio of just 1.2% and a five-year annualized return track record of 11.44%.
T. Rowe Price Cap Appreciation (PRWCX - Free Report) : Expense ratio: 0.71%. Management fee: 0.59%. PRWCX is categorized as an All Cap Value fund, and like the name suggests, invests across the cap spectrum in small-cap, mid-cap, and large-cap companies. PRWCX has managed to produce a robust 10.29% over the last five years.
Neuberger Berman Mid Cap Growth Trust (NBMTX - Free Report) has an expense ratio of 0.95% and management fee of 0.9%. NBMTX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With annual returns of 10.75% over the last five years, this fund is a well-diversified fund with a long track record of success.
Bottom Line
So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.
If you have concerns or any doubts about your investment advisor, read our just-released report:
4 Warning Signs That Your Advisor Might be Sabotaging Your Financial Future