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.
Hancock Horizon Dividend International Fund A (HHDAX): This fund has an expense ratio of 1.47% and a management fee of 0.8%. 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. HHDAX 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. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
MainStay ICAP International C (ICEWX): 2.16% expense ratio, 0.8% management fee. ICEWX is a part of the Non US - Equity fund category, many of which will focus across all cap levels, and will typically allocate their investments between emerging and developed markets. This fund has an annual returns of 0.2% over the last five years. Another fund guilty of having investors pay more in fees than returns.
Gabelli Focus Five Fund C (GWSCX): This fund has an expense ratio of 2.46% and management fee of 1%. GWSCX is a Small Cap Value fund, and these funds are known for investing in companies with market caps under $2 billion. With an annual average return of -1.93% 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.
MassMutual Select Small Cap Growth Equity Admiral (MSGLX) is a winner, with an expense ratio of just 1.16% and a five-year annualized return track record of 10.32%.
Principal Large Cap Growth I J (PLGJX): Expense ratio: 0.82%. Management fee: 0.6%. PLGJX is a Large Cap Growth option; these mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. PLGJX has managed to produce a robust 14.07% over the last five years.
DFA US Large Company I (DFUSX) has an expense ratio of 0.08% and management fee of 0.06%. DFUSX 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 10.78% over the last five years, this fund is well-diversified with a long reputation of salutary performance.
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.
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
Click here for free report>> Get Your Free (DFUSX): Fund Analysis Report Get Your Free (GWSCX): Fund Analysis Report Get Your Free (ICEWX): Fund Analysis Report Get Your Free (HHDAX): Fund Analysis Report Get Your Free (PLGJX): Fund Analysis Report Get Your Free (MSGLX): Fund Analysis Report To read this article on Zacks.com click here. Zacks Investment Research