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Is Fidelity Select Health Care Services (FSHCX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Sector - Health fund category, Fidelity Select Health Care Services (FSHCX - Free Report) could be a potential option. FSHCX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Health funds is an area filled with options, such as FSHCX. Healthcare is one of the biggest sectors of the American economy, and Sector - Health mutual funds provide a great opportunity to invest in this industry. Here, funds can include everything from for-profit hospitals to pharmaceutical companies and medical device manufacturers.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSHCX. The Fidelity Select Health Care Services made its debut in June of 1986 and FSHCX has managed to accumulate roughly $1.13 billion in assets, as of the most recently available information. The fund is currently managed by Justin Segalini who has been in charge of the fund since January of 2016.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 16.57%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.24%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. The standard deviation of FSHCX over the past three years is 20.76% compared to the category average of 19.58%. Looking at the past 5 years, the fund's standard deviation is 17.91% compared to the category average of 18.51%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.82, the fund is likely to be less volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. FSHCX has generated a positive alpha over the past five years of 3.57, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FSHCX is a no load fund. It has an expense ratio of 0.74% compared to the category average of 1.35%. So, FSHCX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Select Health Care Services ( FSHCX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Sector - Health area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FSHCX too for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is Fidelity Select Health Care Services (FSHCX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Sector - Health fund category, Fidelity Select Health Care Services (FSHCX - Free Report) could be a potential option. FSHCX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Health funds is an area filled with options, such as FSHCX. Healthcare is one of the biggest sectors of the American economy, and Sector - Health mutual funds provide a great opportunity to invest in this industry. Here, funds can include everything from for-profit hospitals to pharmaceutical companies and medical device manufacturers.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSHCX. The Fidelity Select Health Care Services made its debut in June of 1986 and FSHCX has managed to accumulate roughly $1.13 billion in assets, as of the most recently available information. The fund is currently managed by Justin Segalini who has been in charge of the fund since January of 2016.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 16.57%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.24%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. The standard deviation of FSHCX over the past three years is 20.76% compared to the category average of 19.58%. Looking at the past 5 years, the fund's standard deviation is 17.91% compared to the category average of 18.51%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.82, the fund is likely to be less volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. FSHCX has generated a positive alpha over the past five years of 3.57, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FSHCX is a no load fund. It has an expense ratio of 0.74% compared to the category average of 1.35%. So, FSHCX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Select Health Care Services ( FSHCX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Sector - Health area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FSHCX too for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.