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3 Mutual Fund Misfires to Avoid - November 08, 2019
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Does your current advisor have your money invested in these "Mutual Fund Misfires of the Market" that charge high fees for low returns? If so, it may be time for a new 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.
Wells Fargo Short Duration Government A (MSDAX - Free Report) : This fund has an expense ratio of 0.8% and a management fee of 0.35%. 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. MSDAX is a Government Bond - Short fund, and these funds hold securities issued by the U.S. federal government. This category focuses on the short end of the curve, and are seen as extremely low risk securities from a default perspective. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Acadian Emerging Markets Institutional (AEMGX - Free Report) : 1.38% expense ratio, 1%. AEMGX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. This fund has yearly returns of 1.28% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Ivy Cundill Global Value Y (ICDYX - Free Report) - 1.36% expense ratio, 1% management fee. This fund has yielded yearly returns of -0.66% 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 Real Estate Security R5 (PREPX - Free Report) is a fund that has an expense ratio of 1.07%, and a management fee of 0.81%. PREPX is categorized as a Sector - Real Estate mutual fund, which typically invests in various real estate investment trusts (REIT) due to their taxation rules. With yearly returns of 11.48% over the last five years, this fund clearly wins.
Fidelity Advisor Growth Opportunit (FAOFX - Free Report) has an expense ratio of 0.01% and management fee of 0%. FAOFX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. With annual returns of 16.82% over the last five years, this is a well-diversified fund with a long track record of success.
MFS Mid-Cap Growth Fund I (OTCIX - Free Report) : Expense ratio: 0.87%. Management fee: 0.71%. OTCIX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. OTCIX has produced a 13.82% over the last five years.
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.
Do You Know the Top 9 Retirement Investing Mistakes?
Whether you're planning to retire early or not, don't let investing mistakes derail your plans.
Image: Bigstock
3 Mutual Fund Misfires to Avoid - November 08, 2019
Does your current advisor have your money invested in these "Mutual Fund Misfires of the Market" that charge high fees for low returns? If so, it may be time for a new 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.
Wells Fargo Short Duration Government A (MSDAX - Free Report) : This fund has an expense ratio of 0.8% and a management fee of 0.35%. 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. MSDAX is a Government Bond - Short fund, and these funds hold securities issued by the U.S. federal government. This category focuses on the short end of the curve, and are seen as extremely low risk securities from a default perspective. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Acadian Emerging Markets Institutional (AEMGX - Free Report) : 1.38% expense ratio, 1%. AEMGX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. This fund has yearly returns of 1.28% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Ivy Cundill Global Value Y (ICDYX - Free Report) - 1.36% expense ratio, 1% management fee. This fund has yielded yearly returns of -0.66% 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 Real Estate Security R5 (PREPX - Free Report) is a fund that has an expense ratio of 1.07%, and a management fee of 0.81%. PREPX is categorized as a Sector - Real Estate mutual fund, which typically invests in various real estate investment trusts (REIT) due to their taxation rules. With yearly returns of 11.48% over the last five years, this fund clearly wins.
Fidelity Advisor Growth Opportunit (FAOFX - Free Report) has an expense ratio of 0.01% and management fee of 0%. FAOFX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. With annual returns of 16.82% over the last five years, this is a well-diversified fund with a long track record of success.
MFS Mid-Cap Growth Fund I (OTCIX - Free Report) : Expense ratio: 0.87%. Management fee: 0.71%. OTCIX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. OTCIX has produced a 13.82% over the last five years.
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.
Do You Know the Top 9 Retirement Investing Mistakes?
Whether you're planning to retire early or not, don't let investing mistakes derail your plans.
If you have $500,000 or more to invest and want to learn more, click the link to download our free report, 9 Retirement Mistakes that will Ruin Your Retirement.