Are You Invested In These 3 Mutual Fund Misfires? - February 28, 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.

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.

Pioneer Solutions Balanced C (PIDCX): This fund has an expense ratio of 1.19% and a management fee of 0%. 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. PIDCX 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. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.

ProFunds Oil Equipment Service Class & Distribution Investor (OEPIX). Expense ratio: 2.09%. Management fee: 0%. Over the last 5 years, this fund has generated annual returns of -24.81%.

AIG (NYSE:AIG) International Dividend Strategy A (SIEAX): This fund has an expense ratio of 1.9% and management fee of 1%. SIEAX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. With an annual average return of -0.99% 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

There you have it: some prime examples of truly bad mutual funds. In contrast, here are a few funds that have achieved high Zacks Ranks and have low fees.

JPMorgan (NYSE:JPM) Growth Advantage R5 (JGVRX): Expense ratio: 0.74%. Management fee: 0.55%. JGVRX 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. This fund has achieved five-year annual returns of an astounding 15.11%.

Fidelity Advisor Technology I (FATIX): Expense ratio: 0.76%. Management fee: 0.54%. FATIX is a Sector - Tech mutual fund, allowing investors to own a stake in a notoriously volatile sector with a much more diversified approach. FATIX has managed to produce a robust 20.28% over the last five years.

T. Rowe Price Capital Opportunity A (PACOX) has an expense ratio of 0.93% and management fee of 0.49%. PACOX is classified as a Large Cap Blend fund. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a "buy and hold" mindset. With annual returns of 11.8% 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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