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Mutual Fund Misfires of the Market - October 15, 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.

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.

AB International Value B : Expense ratio: 2.4%. Management fee: 0.75%. After expenses, the 5 year return is -0.68%, meaning your fees are far higher than the fund's returns.

Ivy Cundill Global Value I (ICVIX - Free Report) : ICVIX 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. ICVIX offers an expense ratio of 1.12% and annual returns of -0.4% 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.

Hotchkis and Wiley Mid-Cap Value C (HWMCX - Free Report) - 2% expense ratio, 0.75% management fee. This fund has yielded yearly returns of -0.95% in the course of the last five years. Too bad!

3 Top Ranked Mutual Funds

Now that we've covered our "worst offender" list, let's take a look at some of Zacks' highest ranked mutual funds with some of the lowest fees you may want to consider.

Vanguard Explorer Fund Admiral (VEXRX - Free Report) : 0.34% expense ratio and 0.31% management fee. VEXRX is one of many Small Cap Growth mutual funds; these funds tend to create their portfolios around stocks with market capitalization of less than $2 billion. With an annual return of 10.6% over the last five years, this fund is a winner.

Principal Large Cap Growth I R2 has an expense ratio of 1.34% and management fee of 0.6%. PPUNX 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. Thanks to yearly returns of 10.55% over the last five years, PPUNX is an effectively diversified fund with a long reputation of solidly positive performance.

American Century Equity Income Institutional (ACIIX - Free Report) has an expense ratio of 0.71% and management fee of 0.71%. ACIIX is a Large Cap Value mutual fund, which invests in stocks with a market cap of $10 billion of more, but whose share prices do not reflect their intrinsic value. With yearly returns of 10.18% over the last five years, this fund is well-diversified with a long reputation of salutary performance.

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.

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

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