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U.S. equities may have fared well in the past four trading sessions but the broader economic headwinds that induced stock market volatility over the past few months haven’t disappeared completely.
Fears of macroeconomic uncertainties and an impending economic slowdown worldwide have not subsided. Therefore, it would be ideal to invest in no load mutual funds that could offer similar returns to that of a load fund without extra charges.
Global Economic Slowdown Likely in 2019
The International Monetary Fund (IMF) expects 3.7% global growth in 2019, same as its predictions for the last two years. However, this is lower than the fund’s projected global growth eight months ago, which was 3.9%. The International Monetary Fund also expects U.S. growth to slow down from 2.9% in 2018 to 2.5% in 2019.
Reports by the Federal Reserve and UBS echoed IMF’s projections. The Fed expects U.S. economic growth to slow down to 2.3% this year against last year’s second and third-quarter U.S. economic expansion of 4.2% and 3.4%, respectively. UBS noted that stricter monetary policy, alterations in the political scenarios of major economies and weaker projected earnings growth might be the reasons of a global economic slowdown in 2019.
Deteriorating U.S.-China relationships on the trade front had a role to play in the economic slowdown projections as well. Trade war effects were evident in Apple and Samsung’s declining product sales in China in the last quarter of 2018. Both companies blamed China’s economic slowdown for weakening demand of their products.
According to a Bloomberg report, this is what Song Myung-sup, a Hi Investment & Securities Co. analyst, said about the South Korean company’s first drop in quarterly operating profit in two years, “It’s not just Apple, but also smartphone, server and PC manufacturers that are not buying. While the U.S.-China trade war hangs over them, these customers just won’t accept current prices, and Samsung faces pressure to cut chip prices.”
Why Invest in No Load Funds Now?
No load funds are a smart way to avoid some exorbitant fees that Wall Street charges investors. No load funds could be prudent to add to your portfolio in present times as these funds help you get as much returns as possible on your investments, by virtue of no transaction costs that are a characteristic of these funds.
The projections of upcoming adverse stock market conditions justifies investing in no load mutual funds as it helps you avoid entry loads, thus allowing you to pocket the total returns on your investments.
4 No Load Mutual Fundsto Buy
Given the macro uncertainties inducing volatility in the equity markets and projections of an economic slowdown in 2019, it might be prudent to invest in a couple of no load funds that we have chosen for your portfolio.
We have selected funds that carry a Zacks Mutual Fund Rank #1 (Strong Buy). Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5,000.
We expect these funds to outperform peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
Lord Abbett Alpha Strategy R2 (ALFQX - Free Report) seeks long-term capital growth by investing in affiliated mutual funds that are managed by Lord, Abbett & Co. LLC. ALFQX uses a blend strategy that consists of value and growth stocks or a combination of both. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Small Cap Blend product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
ALFQX has an annual expense ratio of 0.77%, which is below the category average of 1.23%. The fund has three and five-year returns of 5.67% and 3.58%, respectively.
American Century High-Yield Municipal Fund Investor Class (ABHYX - Free Report) seeks high income that is exempt from federal income tax. The fund prioritizes high-yield securities by investing in municipal and debt securities. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Muni Bonds product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
ABHYX has an annual expense ratio of 0.60%, which is below the category average of 0.94%. The fund has three and five-year returns of 3.65% and 5.63%, respectively.
Dreyfus Select Managers Small Cap Value Fund Class I (DMVIX - Free Report) seeks capital growth by investing 80% of its net assets in securities of small-cap companies. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Small Cap Value product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
DMVIX has an annual expense ratio of 0.98%, which is below the category average of 1.16%. The fund has three and five-year returns of 5.35% and 2.24%, respectively.
Fidelity Balanced Fund (FBALX - Free Report) seeks capital growth by investing 80% of its net assets in securities of small-cap companies. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Allocation Balanced product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FBALX has an annual expense ratio of 0.98%, which is below the category average of 1.16%. The fund has three and five-year returns of 5.35% and 2.24%, respectively.
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4 Best No Load Mutual Funds to Buy in 2019
U.S. equities may have fared well in the past four trading sessions but the broader economic headwinds that induced stock market volatility over the past few months haven’t disappeared completely.
Fears of macroeconomic uncertainties and an impending economic slowdown worldwide have not subsided. Therefore, it would be ideal to invest in no load mutual funds that could offer similar returns to that of a load fund without extra charges.
Global Economic Slowdown Likely in 2019
The International Monetary Fund (IMF) expects 3.7% global growth in 2019, same as its predictions for the last two years. However, this is lower than the fund’s projected global growth eight months ago, which was 3.9%. The International Monetary Fund also expects U.S. growth to slow down from 2.9% in 2018 to 2.5% in 2019.
Reports by the Federal Reserve and UBS echoed IMF’s projections. The Fed expects U.S. economic growth to slow down to 2.3% this year against last year’s second and third-quarter U.S. economic expansion of 4.2% and 3.4%, respectively. UBS noted that stricter monetary policy, alterations in the political scenarios of major economies and weaker projected earnings growth might be the reasons of a global economic slowdown in 2019.
Deteriorating U.S.-China relationships on the trade front had a role to play in the economic slowdown projections as well. Trade war effects were evident in Apple and Samsung’s declining product sales in China in the last quarter of 2018. Both companies blamed China’s economic slowdown for weakening demand of their products.
According to a Bloomberg report, this is what Song Myung-sup, a Hi Investment & Securities Co. analyst, said about the South Korean company’s first drop in quarterly operating profit in two years, “It’s not just Apple, but also smartphone, server and PC manufacturers that are not buying. While the U.S.-China trade war hangs over them, these customers just won’t accept current prices, and Samsung faces pressure to cut chip prices.”
Why Invest in No Load Funds Now?
No load funds are a smart way to avoid some exorbitant fees that Wall Street charges investors. No load funds could be prudent to add to your portfolio in present times as these funds help you get as much returns as possible on your investments, by virtue of no transaction costs that are a characteristic of these funds.
The projections of upcoming adverse stock market conditions justifies investing in no load mutual funds as it helps you avoid entry loads, thus allowing you to pocket the total returns on your investments.
4 No Load Mutual Funds to Buy
Given the macro uncertainties inducing volatility in the equity markets and projections of an economic slowdown in 2019, it might be prudent to invest in a couple of no load funds that we have chosen for your portfolio.
We have selected funds that carry a Zacks Mutual Fund Rank #1 (Strong Buy). Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5,000.
We expect these funds to outperform peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
Lord Abbett Alpha Strategy R2 (ALFQX - Free Report) seeks long-term capital growth by investing in affiliated mutual funds that are managed by Lord, Abbett & Co. LLC. ALFQX uses a blend strategy that consists of value and growth stocks or a combination of both. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Small Cap Blend product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
ALFQX has an annual expense ratio of 0.77%, which is below the category average of 1.23%. The fund has three and five-year returns of 5.67% and 3.58%, respectively.
American Century High-Yield Municipal Fund Investor Class (ABHYX - Free Report) seeks high income that is exempt from federal income tax. The fund prioritizes high-yield securities by investing in municipal and debt securities. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Muni Bonds product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
ABHYX has an annual expense ratio of 0.60%, which is below the category average of 0.94%. The fund has three and five-year returns of 3.65% and 5.63%, respectively.
Dreyfus Select Managers Small Cap Value Fund Class I (DMVIX - Free Report) seeks capital growth by investing 80% of its net assets in securities of small-cap companies. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Small Cap Value product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
DMVIX has an annual expense ratio of 0.98%, which is below the category average of 1.16%. The fund has three and five-year returns of 5.35% and 2.24%, respectively.
Fidelity Balanced Fund (FBALX - Free Report) seeks capital growth by investing 80% of its net assets in securities of small-cap companies. The fund carries a Zacks Mutual Fund Rank #1.
This Zacks sector – Allocation Balanced product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FBALX has an annual expense ratio of 0.98%, which is below the category average of 1.16%. The fund has three and five-year returns of 5.35% and 2.24%, respectively.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>