Does Your Retirement Portfolio Hold These 3 Mutual Fund Misfires? - November 06, 2019
If your advisor has you invested in any of these "Mutual Fund Misfires of the Market" with high fees and low returns, you need to rethink your 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.
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.
Oppenheimer SteelPath MLP Alpha I (OSPAX): 1.23% expense ratio and 1.1% management fee. OSPAX is a Sector - Energy fund, which are comprised of various changing and hugely important industries throughout the massive global energy sector. With a five year after-expenses return of -7.16%, you're mostly paying more in fees than returns.
Lord Abbett Inflation Focused R2 (LIFQX). Expense ratio: 1.08%. Management fee: 1.1%. Over the last 5 years, this fund has generated annual returns of -0.57%.
Ivy Cundill Global Value A (ICDAX): This fund has an expense ratio of 1.55% and management fee of 1%. ICDAX is a Global - Equity mutual fund. These funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. With an annual average return of -1.95% 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.
Principal Large Cap Growth I R2 (PPUNX): 1.34% expense ratio and 0.6% management fee. PPUNX 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 an annual return of 10.55% over the last five years, this fund is a winner.
Janus Henderson Enterprise Institutional (JAAGX) is a stand out fund. JAAGX is a Mid Cap Growth mutual fund. Mid Cap Growth funds pick stocks--usually companies with a market cap between $2 billion and $10 billion--that demonstrate extensive growth opportunities for investors compared to their peers. With five-year annualized performance of 15.42% and expense ratio of 0.72%, this diversified fund is an attractive buy with a strong history of performance.
Fidelity Small Cap Growth (FCPGX) has an expense ratio of 1.04% and management fee of 0.81%. FCPGX is one of many Small Cap Growth mutual funds; these funds tend to create their portfolios around stocks with market capitalization of less than $2 billion. With yearly returns of 14.27% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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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