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3 Mutual Fund Misfires to Avoid - November 28, 2019
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If your advisor has you invested in any of these "Mutual Fund Misfires of the Market" with high fees and low returns, you need to rethink your advisor.
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.
Lord Abbett Inflation Focused C (LIFCX - Free Report) : 1.33% expense ratio and 0.3% management fee. LIFCX is classified as a Government - Bonds fund. These funds hold securities issued by the U.S. federal government in their portfolios, and focus across the curve, meaning the yields and interest rate sensitivity will vary. With a five year after-costs return of -0.78%, you're for the most part paying more in charges than returns.
Intrepid Capital Fund Institutional (ICMVX - Free Report) : 1.15% expense ratio, 1% management fee. ICMVX is classified as an Allocation Balanced fund, which seeks to invest in a balance of asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual. This fund has an annual returns of 1.05% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Legg Mason BW Absolute Return Opportunity C1 - 1.59% expense ratio, 0.64% management fee. LROCX is part of the Investment Grade Bond - Intermediate fund group. These mutual funds focus on the middle part of the curve, generally with bonds that usually mature in more than three years but less than 15 years. LROCX has generated annual returns of -0.05% over the last five years. Ouch!
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.
Fidelity Growth Discovery (FDSVX - Free Report) is a fund that has an expense ratio of 0.76%, and a management fee of 0.57%. FDSVX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. With yearly returns of 10.84% over the last five years, this fund clearly wins.
Oppenheimer Discovery Y (ODIYX - Free Report) has an expense ratio of 0.84% and management fee of 0.63%. ODIYX is a Small Cap Growth mutual fund and tends to feature small companies in up-and-coming industries and markets. Thanks to yearly returns of 12.59% over the last five years, ODIYX is an effectively diversified fund with a long reputation of solidly positive performance.
Red Oak Technology Select (ROGSX - Free Report) is an attractive fund with a five-year annualized return of 17.03% and an expense ratio of just 0.94%. ROGSX is part of the Sector - Tech mutual fund category that invests in technology and lets investors own a stake in a notoriously volatile sector, but with a much more diversified approach.
Bottom Line
Along these lines, there you have it - if your financial guide has you put your money into any of our "Mutual Fund Misfires of the Market," there is a strong likelihood that they are either dormant at the worst possible time, inept, or (in all probability) filling their pockets with high fee commissions at the cost of your financial objectives.
Do You Know the Top 9 Retirement Investing Mistakes?
Whether you're planning to retire early or not, don't let investing mistakes derail your plans.
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3 Mutual Fund Misfires to Avoid - November 28, 2019
If your advisor has you invested in any of these "Mutual Fund Misfires of the Market" with high fees and low returns, you need to rethink your advisor.
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.
Lord Abbett Inflation Focused C (LIFCX - Free Report) : 1.33% expense ratio and 0.3% management fee. LIFCX is classified as a Government - Bonds fund. These funds hold securities issued by the U.S. federal government in their portfolios, and focus across the curve, meaning the yields and interest rate sensitivity will vary. With a five year after-costs return of -0.78%, you're for the most part paying more in charges than returns.
Intrepid Capital Fund Institutional (ICMVX - Free Report) : 1.15% expense ratio, 1% management fee. ICMVX is classified as an Allocation Balanced fund, which seeks to invest in a balance of asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual. This fund has an annual returns of 1.05% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Legg Mason BW Absolute Return Opportunity C1 - 1.59% expense ratio, 0.64% management fee. LROCX is part of the Investment Grade Bond - Intermediate fund group. These mutual funds focus on the middle part of the curve, generally with bonds that usually mature in more than three years but less than 15 years. LROCX has generated annual returns of -0.05% over the last five years. Ouch!
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.
Fidelity Growth Discovery (FDSVX - Free Report) is a fund that has an expense ratio of 0.76%, and a management fee of 0.57%. FDSVX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. With yearly returns of 10.84% over the last five years, this fund clearly wins.
Oppenheimer Discovery Y (ODIYX - Free Report) has an expense ratio of 0.84% and management fee of 0.63%. ODIYX is a Small Cap Growth mutual fund and tends to feature small companies in up-and-coming industries and markets. Thanks to yearly returns of 12.59% over the last five years, ODIYX is an effectively diversified fund with a long reputation of solidly positive performance.
Red Oak Technology Select (ROGSX - Free Report) is an attractive fund with a five-year annualized return of 17.03% and an expense ratio of just 0.94%. ROGSX is part of the Sector - Tech mutual fund category that invests in technology and lets investors own a stake in a notoriously volatile sector, but with a much more diversified approach.
Bottom Line
Along these lines, there you have it - if your financial guide has you put your money into any of our "Mutual Fund Misfires of the Market," there is a strong likelihood that they are either dormant at the worst possible time, inept, or (in all probability) filling their pockets with high fee commissions at the cost of your financial objectives.
Do You Know the Top 9 Retirement Investing Mistakes?
Whether you're planning to retire early or not, don't let investing mistakes derail your plans.
If you have $500,000 or more to invest and want to learn more, click the link to download our free report, 9 Retirement Mistakes that will Ruin Your Retirement.