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Mutual Fund Misfires of the Market - February 13, 2020

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If your financial advisor made you buy any of these "Mutual Fund Misfires of the Market" with high expenses and low returns, you need to reassess your advisor.

High fees coupled with poor results: It's a straightforward equation for an awful mutual fund. Some are more regrettable than others - and some are bad to the point that they have got a "Strong Sell" from our Zacks Rank, the lowest positioning of the almost 19,000 mutual funds we rank every 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.

Transamerica Emerging Markets Equity C : 2.2% expense ratio and 0.92% management fee. CEMTX 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. With a five year after-expenses return of 1.98%, you're mostly paying more in fees than returns.

Templeton Global Balanced Fund A (TAGBX - Free Report) : TAGBX is a Global - Equity mutual fund investing in bigger markets like the U.S., Europe, and Japan; these kinds of funds aren't limited by geography. TAGBX offers an expense ratio of 1.2% and annual returns of 1.18% over the last five years. Even if this fund can be positioned as a hedge during the recent bull-market, paying more in fees than returns over the long-term should never be an acceptable result.

Touchstone Ultra Short Duration Fixed Income C (TSDCX - Free Report) - 1.19% expense ratio, 0.25% management fee. This fund has yielded yearly returns of -0.19% in the course of the last five years. Too bad!

3 Top Ranked Mutual Funds

Since you've seen the most noticeably lowest Zacks Ranked mutual funds, how about we take a look at some of the top ranked mutual funds with the least fees.

AQR Large Cap Defensive Style I (AUEIX - Free Report) is a winner, with an expense ratio of just 0.38% and a five-year annualized return track record of 13.39%.

MSIF Global Opportunity Portfolio L (MGGLX - Free Report) is a stand out fund. MGGLX is a Global - Equity mutual fund. These funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. With five-year annualized performance of 17.5% and expense ratio of 1.29%, this diversified fund is an attractive buy with a strong history of performance.

MFS Growth R6 (MFEKX - Free Report) is an attractive fund with a five-year annualized return of 15.37% and an expense ratio of just 0.57%. MFEKX is a Large Cap Growth mutual fund, and these funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.

Bottom Line

We hope that your investment advisor (if you use one) has you invested in one or all of the top-ranked mutual funds we've reviewed. But if that is not the case, and your advisor has you invested in any of the funds on our "worst offender" list, it might be time to have a conversation or reconsider this vitally important relationship.

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