Throwing Lemons: Worst Funds According to Doug Fabian

October 25, 2001 ( - If you are a sponsor considering the addition of some new funds to your plan's offerings, checking out Doug Fabian's Lemon List might be a good idea.

Fabian, editor of the Maverick Advisor, an investment advisory service, has been publishing the list since 1998. In it, he compares the performance of all equity funds with five-year track records with their peer group averages.

To be considered a lemon, a fund must underperform its peer group by 25% for the last 12 months, and also underperform for the last three and five years.

A few of the losers this quarter are a group of 54 balanced funds, which comprise 22% of the total lemon list assets. Balanced fund portfolio managers follow a risk-adjusted strategy, using stocks and bonds. Many advisers recommend balanced funds to clients who want to avoid market volatility.  

A few of Fabian’s lemons:

  • AIM: Balanced Fund; A, B
  • Vanguard LifeStrategy Growth
  • Scudder Total Return; A, B, C
  • AXP: Mutual; A, B, Y
  • Fidelity Advisor Balanced; T, A, Ins
  • MainStay: Total Return; B, A
  • Liberty: Liberty Fund; A, B, Z
  • Evergreen Foundation; B, I A, C
  • Columbia Balanced
  • INVESCO Balanced; Inv