3 Mutual Fund Misfires to Avoid - April 01, 2020
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.
The easiest way to judge a mutual fund's quality over time is by analyzing its performance and fees. Our Zacks Rank of over 19,000 mutual funds has identified some of the worst of the worst mutual funds you should avoid, the funds with the highest fees and poorest long-term performance.
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.
Janus Henderson Short Term Bond C (JSHCX): Expense ratio: 1.49%. Management fee: 0.44%. After expenses, the 5 year return is 0.73%, meaning your fees are far higher than the fund's returns.
Goldman Sachs Dynamic Allocation C (GDCFX): GDCFX 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. GDCFX offers an expense ratio of 1.92% and annual returns of -0.54% 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.
Catalyst Small Cap Insider Buy A (CTVAX): Expense ratio: 1.77%. Management fee: 1.25%. CTVAX is a Small Cap Growth mutual fund and tends to feature small companies in up-and-coming industries and markets. With annual returns of just -3.68%, 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.
JPMorgan Mid Cap Growth Fund R2 (JMGZX): Expense ratio: 1.49%. Management fee: 0.65%. JMGZX 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. This fund has achieved five-year annual returns of an astounding 11.47%.
T. Rowe Price Global Growth Stock Retail (RPGEX): Expense ratio: 0.93%. Management fee: 0.64%. RPGEX is a Global - Equity mutual fund investing in bigger markets like the U.S., Europe, and Japan; these kinds of funds aren't limited by geography. RPGEX has managed to produce a robust 11.13% over the last five years.
TIAA-CREF Social Choice Equity Premier (TRPSX) has an expense ratio of 0.33% and management fee of 0.15%. TRPSX 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. With yearly returns of 10.54% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
Bottom Line
So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.
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.
This report will help you steer clear of the most common mistakes, like trying to time the market, lack of diversification in your portfolio, and many more. Get Your FREE Guide Now
Get Your Free (JMGZX): Fund Analysis Report
Get Your Free (RPGEX): Fund Analysis Report
Get Your Free (GDCFX): Fund Analysis Report
Get Your Free (TRPSX): Fund Analysis Report
Get Your Free (CTVAX): Fund Analysis Report
Get Your Free (JSHCX): Fund Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
