3 Mutual Fund Misfires To Avoid In Your Retirement Portfolio - October 09, 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.

The easiest way to judge a mutual fund's quality over time is by analyzing its performance and fees. Our Zacks Rank of over 19,000 mutual funds has identified some of the worst of the worst mutual funds you should avoid, the funds with the highest fees and poorest long-term performance.

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.

Lord Abbett Inflation Focused C (LIFCX): 1.34% expense ratio and 0.3% management fee. LIFCX is classified as a Government - Bonds fund. These funds hold securities issued by the U.S. federal government in their portfolios, and focus across the curve, meaning the yields and interest rate sensitivity will vary. With a five year after-expenses return of -1.13%, you're mostly paying more in fees than returns.

Brandes International Equity Fund A (BIEAX): 1.16% expense ratio, 0.8% management fee. BIEAX is a Non US - Equity option, focusing their investments acoss emerging and developed markets, and can often extend across cap levels too. This fund has an annual returns of -0.38% over the last five years. Another fund guilty of having investors pay more in fees than returns.

Hartford Global Real Asset Y (HRLYX): This fund has an expense ratio of 0.9% and management fee of 0.85%. HRLYX is a Global - Equity mutual fund. These funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. With an annual average return of -2.17% 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

Now that you've seen the worst Zacks Ranked mutual funds, let's have a look at some of the highest ranked funds with the lowest fees.

Nicholas II Fund (NCTWX) is a fund that has an expense ratio of 0.61%, and a management fee of 0.52%. NCTWX is a Mid Cap Growth mutual fund. These mutual funds choose companies with a stock market valuation between $2 billion and $10 billion. With yearly returns of 10.92% over the last five years, this fund clearly wins.

Baron Fifth Avenue Growth Institutional (BFTIX): Expense ratio: 0.75%. Management fee: 0.7%. BFTIX 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. BFTIX has managed to produce a robust 14.52% over the last five years.

Janus Henderson Global Technology A (JATAX) has an expense ratio of 1.02% and management fee of 0.64%. JATAX is a Sector - Tech mutual fund, allowing investors to own a stake in a notoriously volatile sector with a much more diversified approach. With annual returns of 16.64% over the last five years, this fund is a well-diversified fund with a long track record of success.

Bottom Line

So, there you have it - if your advisor has you invested in any of our "Mutual Fund Misfires of the Market," there is a good probability that they are either asleep at the wheel, incompetent, or (most likely) lining their pockets with high fee commissions at your financial expense.

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