We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Mutual Fund Misfires of the Market - March 17, 2020
Read MoreHide Full Article
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.
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.
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.
Rational Dividend Capture Institutional (HDCTX - Free Report) : This fund has an expense ratio of 1% and a management fee of 0.75%. 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. HDCTX is a part of the Large Cap Value category, and invests in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
First Investor International Opportunities Bond Adviser : 1.08% expense ratio, 0.75%. FIODX is an International Bond - Developed fund, and these funds funds focus on fixed income securities from developed nations apart from the United States. This usually results in countries like Japan, Germany, the UK, France, and Australia dominating the list of top holdings. This fund has yearly returns of -0.45% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Saratoga Energy & Basic Materials I (SEPIX - Free Report) - 3% expense ratio, 1.25% management fee. SEPIX is a Sector - Energy fund, which are comprised of various changing and hugely important industries throughout the massive global energy sector. SEPIX has generated annual returns of -4% 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.
Fidelity Select Software & Company Services (FSCSX - Free Report) : 0.71% expense ratio and 0.54% management fee. FSCSX is part of the Sector - Tech mutual fund category that invests in technology and lets investors own a stake in a notoriously volatile sector, but with a much more diversified approach. With an annual return of 19.54% over the last five years, this fund is a winner.
MFS Research Fund A (MFRFX - Free Report) is a stand out fund. MFRFX is a Large Cap Growth mutual fund, and these funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers. With five-year annualized performance of 10.21% and expense ratio of 0.79%, this diversified fund is an attractive buy with a strong history of performance.
T. Rowe Price Global Stock (PRGSX - Free Report) : Expense ratio: 0.82%. Management fee: 0.64%. PRGSX 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. PRGSX has produced a 14.2% over the last five years.
Bottom Line
Along these lines, there you have it - if your financial guide has you put your money into any of our "Mutual Fund Misfires of the Market," there is a strong likelihood that they are either dormant at the worst possible time, inept, or (in all probability) filling their pockets with high fee commissions at the cost of your financial objectives.
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
Mutual Fund Misfires of the Market - March 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.
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.
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.
Rational Dividend Capture Institutional (HDCTX - Free Report) : This fund has an expense ratio of 1% and a management fee of 0.75%. 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. HDCTX is a part of the Large Cap Value category, and invests in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
First Investor International Opportunities Bond Adviser : 1.08% expense ratio, 0.75%. FIODX is an International Bond - Developed fund, and these funds funds focus on fixed income securities from developed nations apart from the United States. This usually results in countries like Japan, Germany, the UK, France, and Australia dominating the list of top holdings. This fund has yearly returns of -0.45% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Saratoga Energy & Basic Materials I (SEPIX - Free Report) - 3% expense ratio, 1.25% management fee. SEPIX is a Sector - Energy fund, which are comprised of various changing and hugely important industries throughout the massive global energy sector. SEPIX has generated annual returns of -4% 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.
Fidelity Select Software & Company Services (FSCSX - Free Report) : 0.71% expense ratio and 0.54% management fee. FSCSX is part of the Sector - Tech mutual fund category that invests in technology and lets investors own a stake in a notoriously volatile sector, but with a much more diversified approach. With an annual return of 19.54% over the last five years, this fund is a winner.
MFS Research Fund A (MFRFX - Free Report) is a stand out fund. MFRFX is a Large Cap Growth mutual fund, and these funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers. With five-year annualized performance of 10.21% and expense ratio of 0.79%, this diversified fund is an attractive buy with a strong history of performance.
T. Rowe Price Global Stock (PRGSX - Free Report) : Expense ratio: 0.82%. Management fee: 0.64%. PRGSX 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. PRGSX has produced a 14.2% over the last five years.
Bottom Line
Along these lines, there you have it - if your financial guide has you put your money into any of our "Mutual Fund Misfires of the Market," there is a strong likelihood that they are either dormant at the worst possible time, inept, or (in all probability) filling their pockets with high fee commissions at the cost of your financial objectives.
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.