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3 Mutual Fund Misfires to Avoid - January 17, 2020
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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 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.
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.
Oppenheimer SteelPath MLP Alpha Y (MLPOX - Free Report) : 1.29% expense ratio and 1.1% management fee. MLPOX is a Sector - Energy mutual fund, which encompasses a wide range of vastly changing and vitally important industries throughout this massive global sector. With a five year after-costs return of -5.61%, you're for the most part paying more in charges than returns.
Templeton Frontier Markets C : FFRMX is a part of the Non US - Equity fund category, many of which will focus across all cap levels, and will typically allocate their investments between emerging and developed markets. FFRMX offers an expense ratio of 2.71% and annual returns of -3.98% 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.
Snow Capital Small Cap Value A (SNWAX - Free Report) - 1.5% expense ratio, 0.95% management fee. This fund has yielded yearly returns of -0.88% 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.
Loomis Sayles Small Cap Growth N (LSSNX - Free Report) is a fund that has an expense ratio of 0.82%, and a management fee of 0.75%. LSSNX is a Small Cap Growth mutual fund building their portfolio around stocks with market caps under $2 billion and large growth opportunities. With yearly returns of 11.63% over the last five years, this fund clearly wins.
MFS Mass Investors Growth Stock R2 (MIRGX - Free Report) has an expense ratio of 0.98% and management fee of 0.33%. MIRGX is a part of the Large Cap Growth mutual fund category, which invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. Thanks to yearly returns of 13.7% over the last five years, MIRGX is an effectively diversified fund with a long reputation of solidly positive performance.
Dreyfus Worldwide Growth Y (DPRIX - Free Report) : Expense ratio: 0.82%. Management fee: 0.75%. DPRIX is a Global - Equity mutual fund investing in bigger markets like the U.S., Europe, and Japan; these kinds of funds aren't limited by geography. DPRIX has produced a 10.78% over the last five years.
Bottom Line
These examples underscore the huge range in quality of mutual funds - from the really bad to the astonishingly good. There is no reason for your advisor to keep your money in any fund that charges more than you get in return (unless they're getting something out of it, like a high commission).
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.
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3 Mutual Fund Misfires to Avoid - January 17, 2020
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 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.
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.
Oppenheimer SteelPath MLP Alpha Y (MLPOX - Free Report) : 1.29% expense ratio and 1.1% management fee. MLPOX is a Sector - Energy mutual fund, which encompasses a wide range of vastly changing and vitally important industries throughout this massive global sector. With a five year after-costs return of -5.61%, you're for the most part paying more in charges than returns.
Templeton Frontier Markets C : FFRMX is a part of the Non US - Equity fund category, many of which will focus across all cap levels, and will typically allocate their investments between emerging and developed markets. FFRMX offers an expense ratio of 2.71% and annual returns of -3.98% 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.
Snow Capital Small Cap Value A (SNWAX - Free Report) - 1.5% expense ratio, 0.95% management fee. This fund has yielded yearly returns of -0.88% 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.
Loomis Sayles Small Cap Growth N (LSSNX - Free Report) is a fund that has an expense ratio of 0.82%, and a management fee of 0.75%. LSSNX is a Small Cap Growth mutual fund building their portfolio around stocks with market caps under $2 billion and large growth opportunities. With yearly returns of 11.63% over the last five years, this fund clearly wins.
MFS Mass Investors Growth Stock R2 (MIRGX - Free Report) has an expense ratio of 0.98% and management fee of 0.33%. MIRGX is a part of the Large Cap Growth mutual fund category, which invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. Thanks to yearly returns of 13.7% over the last five years, MIRGX is an effectively diversified fund with a long reputation of solidly positive performance.
Dreyfus Worldwide Growth Y (DPRIX - Free Report) : Expense ratio: 0.82%. Management fee: 0.75%. DPRIX is a Global - Equity mutual fund investing in bigger markets like the U.S., Europe, and Japan; these kinds of funds aren't limited by geography. DPRIX has produced a 10.78% over the last five years.
Bottom Line
These examples underscore the huge range in quality of mutual funds - from the really bad to the astonishingly good. There is no reason for your advisor to keep your money in any fund that charges more than you get in return (unless they're getting something out of it, like a high commission).
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.