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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.
The easiest way to judge a mutual fund's quality over time is by analyzing its performance and fees. Our Zacks Rank of over 19,000 mutual funds has identified some of the worst of the worst mutual funds you should avoid, the funds with the highest fees and poorest long-term performance.
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.
Ivy Municipals Bond C : 1.72% expense ratio and 0.51% management fee. WMBCX is a Muni - Bonds fund; these funds invest in debt securities issued by states and local municipalities, which are typically used to pay for infrastructure construction, schools, and other government functions. With a five year after-expenses return of 1.57%, you're mostly paying more in fees than returns.
AB Allocation Market Real Return C (ACMTX - Free Report) . Expense ratio: 2.05%. Management fee: 0.51%. Over the last 5 years, this fund has generated annual returns of 0.03%.
Clearbridge International Value C (SBICX - Free Report) : This fund has an expense ratio of 1.94% and management fee of 0.75%. SBICX 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. With an annual average return of 0.81% over the last five years, the only thing absolute about this absolute return fund is that it absolutely deserves to be on our "worst offender" list.
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 R2 is a fund that has an expense ratio of 1.24%, and a management fee of 0.47%. PCANX is a Large Cap Blend fund, targeting companies with market caps of over $10 billion. These funds offer investors a stability, and are perfect for people with a "buy and hold" mindset. With yearly returns of 10.9% over the last five years, this fund clearly wins.
AQR Large Cap Momentum Style I (AMOMX - Free Report) has an expense ratio of 0.4% and management fee of 0.25%. AMOMX 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. With annual returns of 10.64% over the last five years, this is a well-diversified fund with a long track record of success.
Baron Partners Fund Institutional (BPTIX - Free Report) : Expense ratio: 1.07%. Management fee: 1%. BPTIX 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. BPTIX has produced a 13.9% over the last five years.
Bottom Line
So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.
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 - March 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.
The easiest way to judge a mutual fund's quality over time is by analyzing its performance and fees. Our Zacks Rank of over 19,000 mutual funds has identified some of the worst of the worst mutual funds you should avoid, the funds with the highest fees and poorest long-term performance.
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.
Ivy Municipals Bond C : 1.72% expense ratio and 0.51% management fee. WMBCX is a Muni - Bonds fund; these funds invest in debt securities issued by states and local municipalities, which are typically used to pay for infrastructure construction, schools, and other government functions. With a five year after-expenses return of 1.57%, you're mostly paying more in fees than returns.
AB Allocation Market Real Return C (ACMTX - Free Report) . Expense ratio: 2.05%. Management fee: 0.51%. Over the last 5 years, this fund has generated annual returns of 0.03%.
Clearbridge International Value C (SBICX - Free Report) : This fund has an expense ratio of 1.94% and management fee of 0.75%. SBICX 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. With an annual average return of 0.81% over the last five years, the only thing absolute about this absolute return fund is that it absolutely deserves to be on our "worst offender" list.
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 R2 is a fund that has an expense ratio of 1.24%, and a management fee of 0.47%. PCANX is a Large Cap Blend fund, targeting companies with market caps of over $10 billion. These funds offer investors a stability, and are perfect for people with a "buy and hold" mindset. With yearly returns of 10.9% over the last five years, this fund clearly wins.
AQR Large Cap Momentum Style I (AMOMX - Free Report) has an expense ratio of 0.4% and management fee of 0.25%. AMOMX 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. With annual returns of 10.64% over the last five years, this is a well-diversified fund with a long track record of success.
Baron Partners Fund Institutional (BPTIX - Free Report) : Expense ratio: 1.07%. Management fee: 1%. BPTIX 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. BPTIX has produced a 13.9% over the last five years.
Bottom Line
So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.
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.