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.
How can you tell a good mutual fund from a bad one? It's pretty basic: If the fund has high fees and performs poorly, it's not good. Of course, there's a range - but when a mutual fund earns a Zacks Rank of #5 (Strong Sell) that means it's among the worst of roughly 19,000 funds we rate each 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.
NYSA Fund (NYSAX): 4.01% expense ratio and 1% management fee. NYSAX 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. With a five year after-costs return of -0.85%, you're for the most part paying more in charges than returns.
Vanguard Precious Metals & Mining (VGPMX): 0.38% expense ratio, 0.3% management fee. Sector - Precious Metal funds like VGPMX normally invest in stocks focused on the mining and production of precious metals such as gold, silver, platinum, and palladium. This fund has an annual returns of -0.23% over the last five years. Another fund guilty of having investors pay more in fees than returns.
AIG (NYSE:AIG) International Dividend Strategy C (SIETX) - 2.55% expense ratio, 1% management fee. This fund has yielded yearly returns of -0.53% in the course of the last five years. Too bad!
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.
BlackRock (NYSE:BLK) Advantage Large Cap Growth S (CMVSX): Expense ratio: 0.87%. Management fee: 0.57%. CMVSX 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. This fund has achieved five-year annual returns of an astounding 12.17%.
JPMorgan (NYSE:JPM) Mid Cap Growth Fund A (OSGIX) has an expense ratio of 1.23% and management fee of 0.65%. OSGIX is a Mid Cap Growth mutual fund. These funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. With annual returns of 10.57% over the last five years, this is a well-diversified fund with a long track record of success.
Fidelity Advisor Technology I (FATIX) is an attractive fund with a five-year annualized return of 20.28% and an expense ratio of just 0.76%. FATIX is a Sector - Tech mutual fund, allowing investors to own a stake in a notoriously volatile sector with a much more diversified approach.
Bottom Line
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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Zacks Investment Research