3 Mutual Fund Misfires to Avoid - October 31, 2019
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.
High fees coupled with poor results: It's a straightforward equation for an awful mutual fund. Some are more regrettable than others - and some are bad to the point that they have got a "Strong Sell" from our Zacks Rank, the lowest positioning of the almost 19,000 mutual funds we rank every 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.
Ivy Natural Resources C (IGNCX): 2.07% expense ratio and 0.85% management fee. IGNCX 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. With a five year after-costs return of -9.16%, you're for the most part paying more in charges than returns.
Janus Henderson Diversified Alternatives T (JDATX): 1.29% expense ratio, 1%. JDATX is an Allocation Balanced mutual fund. Allocation Balanced funds look to invest across asset types, like stocks, bonds, and cash, and including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation. This fund has yearly returns of 1% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.
Oppenheimer Global Strategy Income C (OSICX): This fund has an expense ratio of 1.76% and management fee of 0.55%. OSICX is a Diversified Bonds investment option; these funds give investors exposure to a variety of fixed income types that span across different issuers, maturities, and credit levels. With an annual average return of 1.34% 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
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.
AQR Large Cap Momentum Style R6 (QMORX) is a winner, with an expense ratio of just 0.3% and a five-year annualized return track record of 10.33%.
BlackRock Advantage Large Cap Growth S (CMVSX) has an expense ratio of 0.87% and management fee of 0.57%. CMVSX 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. With annual returns of 10.64% over the last five years, this is a well-diversified fund with a long track record of success.
Victory Sycamore Established Value Y (VEVYX): Expense ratio: 0.62%. Management fee: 0.45%. VEVYX is categorized as an All Cap Value fund, and like the name suggests, invests across the cap spectrum in small-cap, mid-cap, and large-cap companies. VEVYX has produced a 10.46% over the last five years.
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.
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