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3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - November 04, 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.
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.
Below, you'll read about some of the funds included in our current list of "Mutual Fund Misfires of the Market." And if by chance you're invested in any of these misfires, we'll help and review some of our highest Zacks Ranked mutual funds.
3 Mutual Fund Misfires
Now, let's take a look at three market misfires.
Virtus Equity Trend C : This fund has an expense ratio of 2.3% and a management fee of 1%. Without even doing any in-depth analysis, just the fact that you are paying more in fees than you're earning in returns is reason enough not to invest. VAPCX is classified as a Large Cap Blend fund. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a "buy and hold" mindset. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
AB Allocation Market Real Return 2 : 0.81% expense ratio, 0.75% management fee. AMTTX 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 -2.27% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Hartford Global Real Asset A (HRLAX - Free Report) - 1.25% expense ratio, 0.85% management fee. This fund has yielded yearly returns of -2.89% 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.
Principal Capital Appreciation R5 (PCAQX - Free Report) : Expense ratio: 0.75%. Management fee: 0.47%. PCAQX is classified as a Large Cap Blend fund. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a "buy and hold" mindset. This fund has achieved five-year annual returns of an astounding 10.9%.
Commerce Growth Fund (CFGRX - Free Report) has an expense ratio of 0.75% and management fee of 0.4%. CFGRX 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 14.37% over the last five years, CFGRX is an effectively diversified fund with a long reputation of solidly positive performance.
MFS Mid-Cap Growth Fund A (OTCAX - Free Report) has an expense ratio of 1.12% and management fee of 0.71%. OTCAX is a Mid Cap Growth mutual fund. These funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. With yearly returns of 12.28% 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:
Image: Bigstock
3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - November 04, 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.
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.
Below, you'll read about some of the funds included in our current list of "Mutual Fund Misfires of the Market." And if by chance you're invested in any of these misfires, we'll help and review some of our highest Zacks Ranked mutual funds.
3 Mutual Fund Misfires
Now, let's take a look at three market misfires.
Virtus Equity Trend C : This fund has an expense ratio of 2.3% and a management fee of 1%. Without even doing any in-depth analysis, just the fact that you are paying more in fees than you're earning in returns is reason enough not to invest. VAPCX is classified as a Large Cap Blend fund. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a "buy and hold" mindset. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
AB Allocation Market Real Return 2 : 0.81% expense ratio, 0.75% management fee. AMTTX 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 -2.27% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Hartford Global Real Asset A (HRLAX - Free Report) - 1.25% expense ratio, 0.85% management fee. This fund has yielded yearly returns of -2.89% 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.
Principal Capital Appreciation R5 (PCAQX - Free Report) : Expense ratio: 0.75%. Management fee: 0.47%. PCAQX is classified as a Large Cap Blend fund. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a "buy and hold" mindset. This fund has achieved five-year annual returns of an astounding 10.9%.
Commerce Growth Fund (CFGRX - Free Report) has an expense ratio of 0.75% and management fee of 0.4%. CFGRX 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 14.37% over the last five years, CFGRX is an effectively diversified fund with a long reputation of solidly positive performance.
MFS Mid-Cap Growth Fund A (OTCAX - Free Report) has an expense ratio of 1.12% and management fee of 0.71%. OTCAX is a Mid Cap Growth mutual fund. These funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. With yearly returns of 12.28% 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