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.
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.
Templeton Frontier Markets A (TFMAX): 1.96% expense ratio and 1.4% management fee. TFMAX 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. With a five year after-costs return of -8.69%, you're for the most part paying more in charges than returns.
PSI Stategic Growth Fund A (FXSAX). Expense ratio: 1.9%. Management fee: 1.4%. Over the last 5 years, this fund has generated annual returns of -1.47%.
Great-West Templeton Global Bond (MXGBX): Expense ratio: 1.01%. Management fee: 0.58%. MXGBX 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 annual returns of just 0.39%, it's no surprise this fund has received Zacks' "Strong Sell" ranking.
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.
Neuberger Berman Mid Cap Growth R6 (NRMGX): 0.62% expense ratio and 0.55% management fee. NRMGX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With an annual return of 10.54% over the last five years, this fund is a winner.
Janus Henderson Research S (JRASX) is a stand out fund. JRASX is a Large Cap Growth mutual fund, and these funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers. With five-year annualized performance of 11.04% and expense ratio of 1.04%, this diversified fund is an attractive buy with a strong history of performance.
ClearBridge Dividend Strategy 1 (LCBOX) has an expense ratio of 0.77% and management fee of 0.65%. LCBOX 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. With annual returns of 10.33% over the last five years, this fund is a well-diversified fund with a long track record of success.
Bottom Line
Along these lines, there you have it - if your financial guide has you put your money into any of our "Mutual Fund Misfires of the Market," there is a strong likelihood that they are either dormant at the worst possible time, inept, or (in all probability) filling their pockets with high fee commissions at the cost of your financial objectives.
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