Does Your Retirement Portfolio Hold These 3 Mutual Fund Misfires? - November 29, 2019

You may need to start looking for a new financial advisor if your current one has put any of these high-fee, low-return "Mutual Fund Misfires of the Market" into your portfolio.

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.

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.

Janus Henderson Short Term Bond C (JSHCX): This fund has an expense ratio of 1.49% and a management fee of 0.44%. 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. JSHCX is an Investment Grade Bond - Short option; these funds focus on the short end of the curve, generally with bonds that mature in less than two years. The fund has lagged performance-wise, so perhaps a simpler index future investing strategy might be more effective.

JPMorgan International Value Fund R6 (JNVMX): 0.55% expense ratio, 0.6%. JNVMX 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 yearly returns of -0.23% over the most recent five years. Another fund liable of having investors pay more in charges than what they receive in return.

Templeton Global Total Return A (TGTRX): This fund has an expense ratio of 0.97% and management fee of 0.61%. TGTRX is classified as a Diversified Bonds fund, which offers exposure to a wide variety of fixed income types, stretching across various issuers, credit levels, and maturities. With an annual average return of 0.43% 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.

William Blair Large Cap Growth N (LCGNX) is a fund that has an expense ratio of 1%, and a management fee of 0.6%. LCGNX 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 yearly returns of 14.83% over the last five years, this fund clearly wins.

Principal Capital Appreciation R3 (PCAOX) has an expense ratio of 1.06% and management fee of 0.47%. PCAOX 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 10.55% over the last five years, this is a well-diversified fund with a long track record of success.

TIAA-CREF Real Estate Security Premier (TRRPX) has an expense ratio of 0.66% and management fee of 0.48%. TRRPX is categorized as a Sector - Real Estate mutual fund, which typically invests in various real estate investment trusts (REIT) due to their taxation rules. With yearly returns of 11.68% over the last five years, this fund is well-diversified with a long reputation of salutary performance.

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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