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Mutual Fund Misfires of the Market - February 03, 2020
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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.
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.
First Investor International Opportunities Bond A : 1.36% expense ratio and 0.75% management fee. FIOBX is classified as an International Bond - Developed fund; these funds offer investors geographic diversification by focusing on fixed income securities from developed nations besides the United States. Top holdings include assets from countries like Japan, Germany, the UK, France, and Australia. With a five year after-costs return of -1.52%, you're for the most part paying more in charges than returns.
American Century International Value Investor (ACEVX - Free Report) : 1.36% expense ratio, 1.28%. ACEVX 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. This fund has yearly returns of 1.33% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Snow Capital Small Cap Value A (SNWAX - Free Report) - 1.5% expense ratio, 0.95% management fee. SNWAX is a Small Cap Value mutual fund option, which typically invest in companies with market caps under $2 billion. SNWAX has generated annual returns of -0.88% over the last five years. Ouch!
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.
TIAA-CREF Socl Choice Equity Institutional (TISCX - Free Report) is a winner, with an expense ratio of just 0.17% and a five-year annualized return track record of 10.72%.
Brown Advisory Growth Equity Adviser (BAGAX - Free Report) is a stand out fund. BAGAX 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 five-year annualized performance of 14.52% and expense ratio of 1.1%, this diversified fund is an attractive buy with a strong history of performance.
Jackson Square SMID-Cap Growth IS (DCGTX - Free Report) has an expense ratio of 0.87% and management fee of 0.75%. DCGTX is an All Cap Growth mutual fund. In order to increase diversification, these funds have holdings across small, medium, and large-cap levels. With yearly returns of 13.19% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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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Mutual Fund Misfires of the Market - February 03, 2020
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.
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.
First Investor International Opportunities Bond A : 1.36% expense ratio and 0.75% management fee. FIOBX is classified as an International Bond - Developed fund; these funds offer investors geographic diversification by focusing on fixed income securities from developed nations besides the United States. Top holdings include assets from countries like Japan, Germany, the UK, France, and Australia. With a five year after-costs return of -1.52%, you're for the most part paying more in charges than returns.
American Century International Value Investor (ACEVX - Free Report) : 1.36% expense ratio, 1.28%. ACEVX 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. This fund has yearly returns of 1.33% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Snow Capital Small Cap Value A (SNWAX - Free Report) - 1.5% expense ratio, 0.95% management fee. SNWAX is a Small Cap Value mutual fund option, which typically invest in companies with market caps under $2 billion. SNWAX has generated annual returns of -0.88% over the last five years. Ouch!
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.
TIAA-CREF Socl Choice Equity Institutional (TISCX - Free Report) is a winner, with an expense ratio of just 0.17% and a five-year annualized return track record of 10.72%.
Brown Advisory Growth Equity Adviser (BAGAX - Free Report) is a stand out fund. BAGAX 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 five-year annualized performance of 14.52% and expense ratio of 1.1%, this diversified fund is an attractive buy with a strong history of performance.
Jackson Square SMID-Cap Growth IS (DCGTX - Free Report) has an expense ratio of 0.87% and management fee of 0.75%. DCGTX is an All Cap Growth mutual fund. In order to increase diversification, these funds have holdings across small, medium, and large-cap levels. With yearly returns of 13.19% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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.