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3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - October 03, 2019
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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.
How can you tell a good mutual fund from a bad one? It's pretty basic: If the fund has high fees and performs poorly, it's not good. Of course, there's a range - but when a mutual fund earns a Zacks Rank of #5 (Strong Sell) that means it's among the worst of roughly 19,000 funds we rate each 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.
Franklin Real Return R6 : This fund has an expense ratio of 0.48% and a management fee of 0.63%. 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. FRRRX is a Government - Bonds option, and holds securities issued by the U.S. federal government in their portfolios; these funds focus across the curve, meaning the yields and interest rate sensitivity will vary. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Horizon Active Income Fund N (AIMNX - Free Report) : 0.85% expense ratio, 0.77% management fee. AIMNX 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. This fund has an annual returns of 0.47% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Brandes International Equity C (BIECX - Free Report) - 1.91% expense ratio, 0.8% management fee. This fund has yielded yearly returns of -0.01% in the course of the last five years. Too bad!
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.
Columbia Select Large Cap Equity Fund R5 (CLCRX - Free Report) : Expense ratio: 0.46%. Management fee: 0.76%. CLCRX 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 11.06%.
Loomis Sayles Small Cap Growth N (LSSNX - Free Report) : Expense ratio: 0.82%. Management fee: 0.75%. LSSNX is a Small Cap Growth mutual fund building their portfolio around stocks with market caps under $2 billion and large growth opportunities. LSSNX has managed to produce a robust 11.27% over the last five years.
MFS Mass Investors Growth Stock R5 (MIGNX - Free Report) has an expense ratio of 0.38% and management fee of 0.33%. MIGNX 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 annual returns of 13.12% over the last five years, this fund is a well-diversified fund with a long track record of success.
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.
If you have concerns or any doubts about your investment advisor, read our just-released report:
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3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - October 03, 2019
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.
How can you tell a good mutual fund from a bad one? It's pretty basic: If the fund has high fees and performs poorly, it's not good. Of course, there's a range - but when a mutual fund earns a Zacks Rank of #5 (Strong Sell) that means it's among the worst of roughly 19,000 funds we rate each 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.
Franklin Real Return R6 : This fund has an expense ratio of 0.48% and a management fee of 0.63%. 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. FRRRX is a Government - Bonds option, and holds securities issued by the U.S. federal government in their portfolios; these funds focus across the curve, meaning the yields and interest rate sensitivity will vary. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Horizon Active Income Fund N (AIMNX - Free Report) : 0.85% expense ratio, 0.77% management fee. AIMNX 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. This fund has an annual returns of 0.47% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Brandes International Equity C (BIECX - Free Report) - 1.91% expense ratio, 0.8% management fee. This fund has yielded yearly returns of -0.01% in the course of the last five years. Too bad!
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.
Columbia Select Large Cap Equity Fund R5 (CLCRX - Free Report) : Expense ratio: 0.46%. Management fee: 0.76%. CLCRX 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 11.06%.
Loomis Sayles Small Cap Growth N (LSSNX - Free Report) : Expense ratio: 0.82%. Management fee: 0.75%. LSSNX is a Small Cap Growth mutual fund building their portfolio around stocks with market caps under $2 billion and large growth opportunities. LSSNX has managed to produce a robust 11.27% over the last five years.
MFS Mass Investors Growth Stock R5 (MIGNX - Free Report) has an expense ratio of 0.38% and management fee of 0.33%. MIGNX 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 annual returns of 13.12% over the last five years, this fund is a well-diversified fund with a long track record of success.
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.
If you have concerns or any doubts about your investment advisor, read our just-released report:
4 Warning Signs That Your Advisor Might be Sabotaging Your Financial Future