3 High-Performing Funds With Fees Around 1%
Zacks Investment Research | Sep 05, 2019 10:14PM ET
Mutual fund investors who aspire to make the most out of their investments with the least amount of fees could focus on funds that offer a low expense ratio.
It’s no doubt prudent to invest in funds with low expense ratios since this is the amount investors are charged in exchange for fund-managing services. An expense ratio comprises operating costs and management fees. Therefore, the lower the expenses, the higher will be the return. Usually, an expense ratio close to 1% is considered ideal.
However, lower expense ratios are a characteristic of passively managed funds. But these funds are not necessarily known for providing higher returns.
This is where actively managed funds mark their entry. First, these funds focus on outperforming the broader markets and so, mutual fund investors can always count on them for higher returns.
Second, actively managed funds can quickly respond to market gyrations. The funds can under weigh the losing stocks and over weigh the gaining ones, thus lowering risks and improving the portfolio’s outcome.
So, wouldn’t it be ideal to invest in funds that have low expense ratios and at the same time are actively managed? It would definitely be a win-win situation for mutual fund investors.
This is why we have considered three mutual funds that offer expense ratios near and about 1% along with solid returns. All these funds carry a Zacks Mutual Fund Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Additionally, the minimum initial investment is less than $5000. We expect these funds to outperform their peers in the future.
Now we come to the most vital question: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.