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Avoid These 3 Mutual Fund Misfires - March 25, 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.
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.
Ivy Limited-Term Bond B : 1.81% expense ratio and 0.46% management fee. WLTBX is an Investment Grade Bond - Short option; these funds focus on the short end of the curve, generally with bonds that mature in less than two years. With a five year after-expenses return of 0.49%, you're mostly paying more in fees than returns.
Oppenheimer Limited Term Government R : OLTNX is a Government Bond - Short fund, and these funds hold securities issued by the U.S. federal government. This category focuses on the short end of the curve, and are seen as extremely low risk securities from a default perspective. OLTNX offers an expense ratio of 1.1% and annual returns of 0.98% 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.
PACE International Fixed Income A (PWFAX - Free Report) : Expense ratio: 1.03%. Management fee: 0.65%. PWFAX 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. With annual returns of just 0.59%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
Hartford Core Equity R3 (HGIRX - Free Report) : Expense ratio: 1.1%. Management fee: 0.34%. HGIRX is part of the Large Cap Blend section, and these mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a "buy and hold" mindset. This fund has achieved five-year annual returns of an astounding 11.97%.
Janus Henderson Research I (JRAIX - Free Report) has an expense ratio of 0.62% and management fee of 0.53%. JRAIX 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 annual returns of 12.28% over the last five years, this is a well-diversified fund with a long track record of success.
MFS New Discovery R4 (MNDJX - Free Report) has an expense ratio of 1.05% and management fee of 0.88%. MNDJX 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 13.45% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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
Avoid These 3 Mutual Fund Misfires - March 25, 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.
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.
Ivy Limited-Term Bond B : 1.81% expense ratio and 0.46% management fee. WLTBX is an Investment Grade Bond - Short option; these funds focus on the short end of the curve, generally with bonds that mature in less than two years. With a five year after-expenses return of 0.49%, you're mostly paying more in fees than returns.
Oppenheimer Limited Term Government R : OLTNX is a Government Bond - Short fund, and these funds hold securities issued by the U.S. federal government. This category focuses on the short end of the curve, and are seen as extremely low risk securities from a default perspective. OLTNX offers an expense ratio of 1.1% and annual returns of 0.98% 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.
PACE International Fixed Income A (PWFAX - Free Report) : Expense ratio: 1.03%. Management fee: 0.65%. PWFAX 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. With annual returns of just 0.59%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
Hartford Core Equity R3 (HGIRX - Free Report) : Expense ratio: 1.1%. Management fee: 0.34%. HGIRX is part of the Large Cap Blend section, and these mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a "buy and hold" mindset. This fund has achieved five-year annual returns of an astounding 11.97%.
Janus Henderson Research I (JRAIX - Free Report) has an expense ratio of 0.62% and management fee of 0.53%. JRAIX 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 annual returns of 12.28% over the last five years, this is a well-diversified fund with a long track record of success.
MFS New Discovery R4 (MNDJX - Free Report) has an expense ratio of 1.05% and management fee of 0.88%. MNDJX 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 13.45% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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.