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3 Mutual Fund Misfires to Avoid - February 04, 2020
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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 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.
BlackRock Eurofund A (MDEFX - Free Report) : 1.39% expense ratio and 0.75% management fee. MDEFX is a Europe - Equity mutual fund option, and these funds tend to invest their assets in stocks across the European continent, including countries such as Great Britain, Germany, France, Italy, and Spain. With a five year after-expenses return of 1.32%, you're mostly paying more in fees than returns.
AMF Ultra Short Mortgage Fund : ASARX is a Government Mortgage - Short mutual fund; these funds focus on the mortgage-backed securities (MBS) market and specifially, securities that have less than three years until maturity. ASARX offers an expense ratio of 1.4% and annual returns of -0.1% 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.
SEI Multi-Asset Real Return Fund A (SEIAX - Free Report) : Expense ratio: 1%. Management fee: 0.55%. SEIAX is an Allocation Balanced mutual fund. Allocation Balanced funds look to invest across asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation. With annual returns of just 0.4%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
MFS Mass Investors Growth Stock A (MIGFX - Free Report) is a winner, with an expense ratio of just 0.71% and a five-year annualized return track record of 12.73%.
US Global Investor Gold & Precious Metals (USERX - Free Report) is a stand out fund. USERX is a Sector - Precious Metal mutual fund, typically investing in companies that are involved in the mining and production of precious metals like gold, silver, platinum, and palladium. With five-year annualized performance of 15.21% and expense ratio of 0.1%, this diversified fund is an attractive buy with a strong history of performance.
Hirtle Callaghan Institutional Growth Equity HCS (HCIGX - Free Report) : Expense ratio: 0.23%. Management fee: 0.17%. HCIGX is an All Cap Growth mutual fund with holdings across small, medium, and large-cap levels in order to increase diversification. HCIGX has produced a 14% 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.
Image: Bigstock
3 Mutual Fund Misfires to Avoid - February 04, 2020
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 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.
BlackRock Eurofund A (MDEFX - Free Report) : 1.39% expense ratio and 0.75% management fee. MDEFX is a Europe - Equity mutual fund option, and these funds tend to invest their assets in stocks across the European continent, including countries such as Great Britain, Germany, France, Italy, and Spain. With a five year after-expenses return of 1.32%, you're mostly paying more in fees than returns.
AMF Ultra Short Mortgage Fund : ASARX is a Government Mortgage - Short mutual fund; these funds focus on the mortgage-backed securities (MBS) market and specifially, securities that have less than three years until maturity. ASARX offers an expense ratio of 1.4% and annual returns of -0.1% 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.
SEI Multi-Asset Real Return Fund A (SEIAX - Free Report) : Expense ratio: 1%. Management fee: 0.55%. SEIAX is an Allocation Balanced mutual fund. Allocation Balanced funds look to invest across asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation. With annual returns of just 0.4%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
MFS Mass Investors Growth Stock A (MIGFX - Free Report) is a winner, with an expense ratio of just 0.71% and a five-year annualized return track record of 12.73%.
US Global Investor Gold & Precious Metals (USERX - Free Report) is a stand out fund. USERX is a Sector - Precious Metal mutual fund, typically investing in companies that are involved in the mining and production of precious metals like gold, silver, platinum, and palladium. With five-year annualized performance of 15.21% and expense ratio of 0.1%, this diversified fund is an attractive buy with a strong history of performance.
Hirtle Callaghan Institutional Growth Equity HCS (HCIGX - Free Report) : Expense ratio: 0.23%. Management fee: 0.17%. HCIGX is an All Cap Growth mutual fund with holdings across small, medium, and large-cap levels in order to increase diversification. HCIGX has produced a 14% 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.