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 plus poor performance: It's a pretty simple formula for a bad mutual fund. Some are worse than others - and some are so bad that they have earned a "Strong Sell" on the Zacks Rank, the lowest ranking of the nearly 19,000 mutual funds we rank daily.
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.
Ivy Natural Resources A (IGNAX): This fund has an expense ratio of 1.78% and a management fee of 0.85%. 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. IGNAX is a Sector - Energy mutual fund, which encompasses a wide range of vastly changing and vitally important industries throughout this massive global sector. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.
AB Unconstrained Bond C (AGCCX): 1.65% expense ratio, 0.5% management fee. AGCCX 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. This fund has an annual returns of -0.25% over the last five years. Another fund guilty of having investors pay more in fees than returns.
AIG (NYSE:AIG) International Dividend Strategy A (SIEAX) - 1.9% expense ratio, 1% management fee. This fund has yielded yearly returns of -0.99% in the course of the last five years. Too bad!
3 Top Ranked Mutual Funds
Now that we've covered our "worst offender" list, let's take a look at some of Zacks' highest ranked mutual funds with some of the lowest fees you may want to consider.
T. Rowe Price Global Growth Stock Adviser (PAGLX) is a winner, with an expense ratio of just 1.1% and a five-year annualized return track record of 11%.
Janus Henderson Research S (JRASX): Expense ratio: 1.05%. Management fee: 0.56%. 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. JRASX has managed to produce a robust 11.81% over the last five years.
Putnam Global Technology A (PGTAX): Expense ratio: 1.16%. Management fee: 0.62%. PGTAX is a Sector - Tech mutual fund, allowing investors to own a stake in a notoriously volatile sector with a much more diversified approach. PGTAX has produced a 18.8% over the last five years.
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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