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Avoid These 3 Mutual Fund Misfires - 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.
High fees plus poor performance: It's a pretty simple formula for a bad mutual fund. Some are worse than others - and some are so bad that they have earned a "Strong Sell" on the Zacks Rank, the lowest ranking of the nearly 19,000 mutual funds we rank daily.
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.
AQR Multi Strategy Alternative I : 1.96% expense ratio and 1.75% management fee. ASAIX is classified as an Allocation Balanced fund, which seeks to invest in a balance of asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual. With a five year after-expenses return of -1.14%, you're mostly paying more in fees than returns.
Rydex Emerging Market 2X Strategy H (RYWVX - Free Report) . Expense ratio: 1.85%. Management fee: 1.75%. Over the last 5 years, this fund has generated annual returns of -4.02%.
Legg Mason BW Absolute Return Opportunity C (LAOCX - Free Report) - 1.86% expense ratio, 0.64% management fee. This fund has yielded yearly returns of -0.26% in the course of the last five years. Too bad!
3 Top Ranked Mutual Funds
Now that you've seen the worst Zacks Ranked mutual funds, let's have a look at some of the highest ranked funds with the lowest fees.
Victory RS Science&Technology A (RSIFX - Free Report) : 1.47% expense ratio and 1% management fee. With a much more diversified approach, RSIFX--part of the Sector - Tech mutual fund category--gives investors a way to own a stake in the notoriously risky tech sector. With an annual return of 15.86% over the last five years, this fund is a winner.
Putnam Growth Opportunities R6 (PGOEX - Free Report) : Expense ratio: 0.31%. Management fee: 0.45%. PGOEX 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. PGOEX has managed to produce a robust 13.93% over the last five years.
T. Rowe Price Mid-Cap Growth Adviser (PAMCX - Free Report) has an expense ratio of 1.01% and management fee of 0.61%. PAMCX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With annual returns of 12.87% over the last five years, this fund is a well-diversified fund with a long track record of success.
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
Avoid These 3 Mutual Fund Misfires - 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.
High fees plus poor performance: It's a pretty simple formula for a bad mutual fund. Some are worse than others - and some are so bad that they have earned a "Strong Sell" on the Zacks Rank, the lowest ranking of the nearly 19,000 mutual funds we rank daily.
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.
AQR Multi Strategy Alternative I : 1.96% expense ratio and 1.75% management fee. ASAIX is classified as an Allocation Balanced fund, which seeks to invest in a balance of asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual. With a five year after-expenses return of -1.14%, you're mostly paying more in fees than returns.
Rydex Emerging Market 2X Strategy H (RYWVX - Free Report) . Expense ratio: 1.85%. Management fee: 1.75%. Over the last 5 years, this fund has generated annual returns of -4.02%.
Legg Mason BW Absolute Return Opportunity C (LAOCX - Free Report) - 1.86% expense ratio, 0.64% management fee. This fund has yielded yearly returns of -0.26% in the course of the last five years. Too bad!
3 Top Ranked Mutual Funds
Now that you've seen the worst Zacks Ranked mutual funds, let's have a look at some of the highest ranked funds with the lowest fees.
Victory RS Science&Technology A (RSIFX - Free Report) : 1.47% expense ratio and 1% management fee. With a much more diversified approach, RSIFX--part of the Sector - Tech mutual fund category--gives investors a way to own a stake in the notoriously risky tech sector. With an annual return of 15.86% over the last five years, this fund is a winner.
Putnam Growth Opportunities R6 (PGOEX - Free Report) : Expense ratio: 0.31%. Management fee: 0.45%. PGOEX 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. PGOEX has managed to produce a robust 13.93% over the last five years.
T. Rowe Price Mid-Cap Growth Adviser (PAMCX - Free Report) has an expense ratio of 1.01% and management fee of 0.61%. PAMCX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With annual returns of 12.87% over the last five years, this fund is a well-diversified fund with a long track record of success.
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