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.
3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - November 12, 2019
Read MoreHide Full Article
If your financial advisor made you buy any of these "Mutual Fund Misfires of the Market" with high expenses and low returns, you need to reassess your advisor.
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.
Rydex Energy Services H (RYVAX - Free Report) : This fund has an expense ratio of 1.7% and a management fee of 0.85%. 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. RYVAX is a Sector - Energy mutual fund, which encompasses a wide range of vastly changing and vitally important industries throughout this massive global sector. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Optimum Small Mid-Cap Value C (OCSVX - Free Report) : OCSVX is a Small Cap Value fund, and these funds are known for investing in companies with market caps under $2 billion. OCSVX offers an expense ratio of 2.21% and annual returns of 1.86% 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.
Voya GNMA Income C (LEGNX - Free Report) : Expense ratio: 1.7%. Management fee: 0.56%. LEGNX is a Government Mortgage - Intermediate mutual fund; these funds focus on the mortgage-backed securities (MBS) market and specifially, securities that have at least three years, but less than 10, to maturity. With annual returns of just 1.5%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
Eagle Mid Cap Growth A (HAGAX - Free Report) : Expense ratio: 1.05%. Management fee: 0.52%. HAGAX is a Mid Cap Growth mutual fund. These funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. This fund has achieved five-year annual returns of an astounding 10.41%.
JPMorgan Large Cap Growth I (SEEGX - Free Report) has an expense ratio of 0.68% and management fee of 0.5%. SEEGX 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. With annual returns of 14.14% over the last five years, this is a well-diversified fund with a long track record of success.
Hartford Core Equity A (HAIAX - Free Report) is an attractive fund with a five-year annualized return of 10.78% and an expense ratio of just 0.73%. HAIAX 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.
Bottom Line
These examples underscore the huge range in quality of mutual funds - from the really bad to the astonishingly good. There is no reason for your advisor to keep your money in any fund that charges more than you get in return (unless they're getting something out of it, like a high commission).
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
3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - November 12, 2019
If your financial advisor made you buy any of these "Mutual Fund Misfires of the Market" with high expenses and low returns, you need to reassess your advisor.
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.
Rydex Energy Services H (RYVAX - Free Report) : This fund has an expense ratio of 1.7% and a management fee of 0.85%. 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. RYVAX is a Sector - Energy mutual fund, which encompasses a wide range of vastly changing and vitally important industries throughout this massive global sector. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
Optimum Small Mid-Cap Value C (OCSVX - Free Report) : OCSVX is a Small Cap Value fund, and these funds are known for investing in companies with market caps under $2 billion. OCSVX offers an expense ratio of 2.21% and annual returns of 1.86% 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.
Voya GNMA Income C (LEGNX - Free Report) : Expense ratio: 1.7%. Management fee: 0.56%. LEGNX is a Government Mortgage - Intermediate mutual fund; these funds focus on the mortgage-backed securities (MBS) market and specifially, securities that have at least three years, but less than 10, to maturity. With annual returns of just 1.5%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
Eagle Mid Cap Growth A (HAGAX - Free Report) : Expense ratio: 1.05%. Management fee: 0.52%. HAGAX is a Mid Cap Growth mutual fund. These funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. This fund has achieved five-year annual returns of an astounding 10.41%.
JPMorgan Large Cap Growth I (SEEGX - Free Report) has an expense ratio of 0.68% and management fee of 0.5%. SEEGX 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. With annual returns of 14.14% over the last five years, this is a well-diversified fund with a long track record of success.
Hartford Core Equity A (HAIAX - Free Report) is an attractive fund with a five-year annualized return of 10.78% and an expense ratio of just 0.73%. HAIAX 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.
Bottom Line
These examples underscore the huge range in quality of mutual funds - from the really bad to the astonishingly good. There is no reason for your advisor to keep your money in any fund that charges more than you get in return (unless they're getting something out of it, like a high commission).
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.