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3 Mutual Fund Misfires to Avoid - October 29, 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.
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.
Legg Mason BW Absolute Return Opportunity C1 : 1.59% expense ratio and 0.64% management fee. LROCX is an Investment Grade Bond - Intermediate fund, which targets bonds that mature in more than three years but less than 15 years, and are a middle of the curve option for investors. With a five year after-costs return of -0.05%, you're for the most part paying more in charges than returns.
Oppenheimer SteelPath MLP Alph Plus C (MLPMX - Free Report) : MLPMX is classified as a Sector - Energy mutual fund. Throughout the massive global energy sector, these funds hold a wide range of quickly changing and vitally important industries. MLPMX offers an expense ratio of 3.55% and annual returns of -12.07% 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.
Harding Loevner Front Emerging Markets Investor (HLMOX - Free Report) : This fund has an expense ratio of 2% and management fee of 1.35%. HLMOX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. With an annual average return of -4.12% 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
Since you've seen the most noticeably lowest Zacks Ranked mutual funds, how about we take a look at some of the top ranked mutual funds with the least fees.
Conestoga Small Cap Institutional (CCALX - Free Report) : Expense ratio: 0.9%. Management fee: 0.9%. CCALX is a Small Cap Blend mutual fund, allowing investors a way to diversify their funds among various types of small-cap stocks. This fund has achieved five-year annual returns of an astounding 15.54%.
Hartford Stock HLS IB (HIBSX - Free Report) has an expense ratio of 0.77% and management fee of 0.48%. HIBSX 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 annual returns of 11.52% over the last five years, this is a well-diversified fund with a long track record of success.
Capital Group US Equity (CUSEX - Free Report) : Expense ratio: 0.43%. Management fee: 0.43%. CUSEX 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. CUSEX has produced a 10.61% over the last five years.
Bottom Line
We hope that your investment advisor (if you use one) has you invested in one or all of the top-ranked mutual funds we've reviewed. But if that is not the case, and your advisor has you invested in any of the funds on our "worst offender" list, it might be time to have a conversation or reconsider this vitally important relationship.
If you have concerns or any doubts about your investment advisor, read our just-released report:
Image: Bigstock
3 Mutual Fund Misfires to Avoid - October 29, 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.
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.
Legg Mason BW Absolute Return Opportunity C1 : 1.59% expense ratio and 0.64% management fee. LROCX is an Investment Grade Bond - Intermediate fund, which targets bonds that mature in more than three years but less than 15 years, and are a middle of the curve option for investors. With a five year after-costs return of -0.05%, you're for the most part paying more in charges than returns.
Oppenheimer SteelPath MLP Alph Plus C (MLPMX - Free Report) : MLPMX is classified as a Sector - Energy mutual fund. Throughout the massive global energy sector, these funds hold a wide range of quickly changing and vitally important industries. MLPMX offers an expense ratio of 3.55% and annual returns of -12.07% 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.
Harding Loevner Front Emerging Markets Investor (HLMOX - Free Report) : This fund has an expense ratio of 2% and management fee of 1.35%. HLMOX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. With an annual average return of -4.12% 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
Since you've seen the most noticeably lowest Zacks Ranked mutual funds, how about we take a look at some of the top ranked mutual funds with the least fees.
Conestoga Small Cap Institutional (CCALX - Free Report) : Expense ratio: 0.9%. Management fee: 0.9%. CCALX is a Small Cap Blend mutual fund, allowing investors a way to diversify their funds among various types of small-cap stocks. This fund has achieved five-year annual returns of an astounding 15.54%.
Hartford Stock HLS IB (HIBSX - Free Report) has an expense ratio of 0.77% and management fee of 0.48%. HIBSX 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 annual returns of 11.52% over the last five years, this is a well-diversified fund with a long track record of success.
Capital Group US Equity (CUSEX - Free Report) : Expense ratio: 0.43%. Management fee: 0.43%. CUSEX 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. CUSEX has produced a 10.61% over the last five years.
Bottom Line
We hope that your investment advisor (if you use one) has you invested in one or all of the top-ranked mutual funds we've reviewed. But if that is not the case, and your advisor has you invested in any of the funds on our "worst offender" list, it might be time to have a conversation or reconsider this vitally important relationship.
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