Mutual Fund Misfires of the Market - November 19, 2019

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.

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.

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 Global Bond A (TPINX): 0.87% expense ratio and 0.48% management fee. TPINX is an International Bond - Developed mutual fund. Focusing on fixed income securities outside from developed nations besides the U.S., International Bond - Developed funds invest in assets from countries like Japan, Germany, the UK, France, and Australia. With a five year after-expenses return of -0.19%, you're mostly paying more in fees than returns.

Clearbridge International Value A (SBIEX): SBIEX 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. SBIEX offers an expense ratio of 1.25% and annual returns of -2.86% over the last five years. Even if this fund can be positioned as a hedge during the recent bull-market, paying more in fees than returns over the long-term should never be an acceptable result.

BlackRock Eurofund C (MCEFX): This fund has an expense ratio of 2.14% and management fee of 0.75%. MCEFX is a Europe - Equity mutual fund investing in stocks across the vast European continent. With an annual average return of -0.78% 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.

Fidelity Advisor Technology M (FATEX): 1.28% expense ratio and 0.54% management fee. FATEX is part of the Sector - Tech mutual fund category that invests in technology and lets investors own a stake in a notoriously volatile sector, but with a much more diversified approach. With an annual return of 15.94% over the last five years, this fund is a winner.

T. Rowe Price Dividend Growth (PRDGX) has an expense ratio of 0.63% and management fee of 0.49%. PRDGX is part of the Large Cap Blend section, and these mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a "buy and hold" mindset. With annual returns of 12.01% over the last five years, this is a well-diversified fund with a long track record of success.

JPMorgan Small Cap Growth I (OGGFX): Expense ratio: 0.99%. Management fee: 0.65%. OGGFX is one of many Small Cap Growth mutual funds; these funds tend to create their portfolios around stocks with market capitalization of less than $2 billion. OGGFX has produced a 13.81% 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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