Tag Archives: author

3 Top-Ranked Utility Mutual Funds For Steady Returns

Utility funds are an excellent choice for investors seeking a steady income flow. They are also used as defensive instruments, which protect investments during a market downturn. This is because the demand for essential services such as those provided by utilities remains unchanged even during difficult times. In recent years, many funds in this category have increased their exposure to emerging markets and unregulated companies. This has increased the risk involved, but has also generated higher returns. Below, we will share with you three top-rated utility mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all utilities mutual funds, investors can click here to see the complete list of funds . Kinetics Alternative Income Advisor A (MUTF: KWIAX ) seeks to provide current income. KWIAX invests the majority of its assets in the Alternative Income Portfolio, a series of Kinetics Portfolios Trust that holds a portfolio of primarily fixed income securities. The Kinetics Alternative Income Advisor A fund has a three-year annualized return of 2.4%. As of December 2015, KWIAX held 244 issues, with 10.12% of its total assets invested in iShares 1-3 Year Credit Bond. Putnam Global Telecommunication A (MUTF: PGBZX ) invests a major portion of its assets in common stocks of both large and mid-sized companies across the world. PGBZX invests in companies involved in the manufacturing or selling of communication services or communication equipment. PGBZX uses derivative instruments for both hedging and non-hedging purposes. The Putnam Global Telecommunication A fund has a three-year annualized return of 9.3%. PGBZX has an expense ratio of 1.26% as compared to a category average of 1.44%. AllianzGI Global Water C (MUTF: AWTCX ) seeks long-term capital growth. AWTCX invests a major portion of its assets in common stocks of companies that are represented in the S&P Global Water Index, the NASDAQ OMX US Water or Global Water Indices or the S-Network Global Water Index, or are involved in water-related activities. AllianzGI Global Water C is a non-diversified fund and has a three-year annualized return of 4.2%. Andreas Fruschki is the fund manager since 2008. To view the Zacks Rank and past performance of all utilities mutual funds, investors can click here to see the complete list of funds . About Zacks Mutual Fund Rank By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past, but are also expected to outperform going forward. Pick the best mutual funds with the Zacks Rank. Original Post

My ‘Wisdom’ On Robo Advisors

Tadas Viskanta has put together a nice collection of opinions regarding the new “Robo Advisor” trend. Here’s my general view: “Robo “advisors” aren’t really advisors. They’re robo asset allocators. The robotic allocations are susceptible to flawed risk profiling and inefficient portfolio management for most people with a sophisticated financial plan. The business of asset allocation is too personal and customized to ever become fully automated so the best solution is some integration between the human and robot sides.” These are great new services, but you have to be careful with them. When there’s no advisor involved, you’re highly susceptible to poor risk profiling and behavioral problems along the way. After all, a robo advisor doesn’t help you stick to an asset allocation or help you manage it along the way. And I’ll be blunt about the risk profiling process for many of these services – it’s dangerously insufficient. While these are fantastic low-cost options for many investors, I do think they carry their own unique risks if they’re not utilized appropriately. In summary, I’d argue: If you have trouble with your own behavioral biases and maintaining an appropriate asset allocation, then you might consider a low-cost advisor to help you implement the appropriate plan and maintain it. Additionally, if you’re in need of more planning services, then it’s worth bundling a low-cost advisor with your portfolio management services. What’s “low-cost” in today’s world? I’d argue it’s anything less than 0.5% per year. If you don’t have trouble with your own behavioral biases and maintaining an appropriate asset allocation through market gyrations, then you should just buy a simple Vanguard or Schwab ETF allocation and perform annual maintenance, thereby cutting out the extra fees the robos or advisors charge for rebalancing and harvesting tax losses. If you don’t have trouble with your own behavioral biases and maintaining an appropriate asset allocation through market gyrations, but you’re too disorganized or busy to rebalance and harvest losses , then you should consider one of the human PLUS robo options, such as the Vanguard or Schwab offering. I wrote much more about this topic a few years back.