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3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - October 18, 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 plus poor performance: It's a pretty simple formula for a bad mutual fund. Some are worse than others - and some are so bad that they have earned a "Strong Sell" on the Zacks Rank, the lowest ranking of the nearly 19,000 mutual funds we rank daily.
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.
Victory INCORE Low Duration Bond C (RLDCX - Free Report) : 1.62% expense ratio and 0.45% management fee. RLDCX is an Investment Grade Bond - Short option; these funds focus on the short end of the curve, generally with bonds that mature in less than two years. With a five year after-expenses return of 0.69%, you're mostly paying more in fees than returns.
Wells Fargo International Value A : WFFAX is a Non US - Equity fund. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels. WFFAX offers an expense ratio of 1.35% and annual returns of 0.05% 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.
Saratoga Energy & Basic Materials I (SEPIX - Free Report) - 3% expense ratio, 1.25% management fee. This fund has yielded yearly returns of -8.89% 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.
VY T. Rowe Price Cap Appreciation I (ITRIX - Free Report) : 0.64% expense ratio and 0.64% management fee. ITRIX 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. With an annual return of 10.48% over the last five years, this fund is a winner.
Putnam Small Cap Growth R (PSGRX - Free Report) has an expense ratio of 1.46% and management fee of 0.57%. PSGRX is a Small Cap Growth mutual fund and tends to feature small companies in up-and-coming industries and markets. With annual returns of 11.06% over the last five years, this is a well-diversified fund with a long track record of success.
T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) : Expense ratio: 0.66%. Management fee: 0.65%. TRSSX is a Small Cap Blend mutual fund, allowing investors a way to diversify their funds among various types of small-cap stocks. TRSSX has produced a 11.99% over the last five years.
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:
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3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - October 18, 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.
High fees plus poor performance: It's a pretty simple formula for a bad mutual fund. Some are worse than others - and some are so bad that they have earned a "Strong Sell" on the Zacks Rank, the lowest ranking of the nearly 19,000 mutual funds we rank daily.
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.
Victory INCORE Low Duration Bond C (RLDCX - Free Report) : 1.62% expense ratio and 0.45% management fee. RLDCX is an Investment Grade Bond - Short option; these funds focus on the short end of the curve, generally with bonds that mature in less than two years. With a five year after-expenses return of 0.69%, you're mostly paying more in fees than returns.
Wells Fargo International Value A : WFFAX is a Non US - Equity fund. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels. WFFAX offers an expense ratio of 1.35% and annual returns of 0.05% 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.
Saratoga Energy & Basic Materials I (SEPIX - Free Report) - 3% expense ratio, 1.25% management fee. This fund has yielded yearly returns of -8.89% 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.
VY T. Rowe Price Cap Appreciation I (ITRIX - Free Report) : 0.64% expense ratio and 0.64% management fee. ITRIX 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. With an annual return of 10.48% over the last five years, this fund is a winner.
Putnam Small Cap Growth R (PSGRX - Free Report) has an expense ratio of 1.46% and management fee of 0.57%. PSGRX is a Small Cap Growth mutual fund and tends to feature small companies in up-and-coming industries and markets. With annual returns of 11.06% over the last five years, this is a well-diversified fund with a long track record of success.
T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) : Expense ratio: 0.66%. Management fee: 0.65%. TRSSX is a Small Cap Blend mutual fund, allowing investors a way to diversify their funds among various types of small-cap stocks. TRSSX has produced a 11.99% over the last five years.
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