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Is Fidelity Dividend Growth Fund (FDGFX) a Strong Mutual Fund Pick Right Now?
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Large Cap Blend fund seekers should consider taking a look at Fidelity Dividend Growth Fund (FDGFX - Free Report) . FDGFX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FDGFX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend 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. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
FDGFX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Dividend Growth Fund debuted in April of 1993. Since then, FDGFX has accumulated assets of about $5.90 billion, according to the most recently available information. The fund is currently managed by Zachary Turner who has been in charge of the fund since July of 2020.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 11.89%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 10.39%, which places it in the middle 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 FDGFX over the past three years is 21.49% compared to the category average of 17.65%. Over the past 5 years, the standard deviation of the fund is 17.17% compared to the category average of 14.47%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.07, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. With a negative alpha of -5.05, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
As of the last filing date, the mutual fund has 79.64% of its assets in stocks, with an average market capitalization of $381.63 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Turnover is 136%, which means, on average, the fund makes fewer trades than comparable funds.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FDGFX is a no load fund. It has an expense ratio of 0.47% compared to the category average of 0.95%. FDGFX is actually cheaper than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Dividend Growth Fund ( FDGFX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Large Cap Blend 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 FDGFX 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 Dividend Growth Fund (FDGFX) a Strong Mutual Fund Pick Right Now?
Large Cap Blend fund seekers should consider taking a look at Fidelity Dividend Growth Fund (FDGFX - Free Report) . FDGFX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FDGFX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend 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. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
FDGFX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Dividend Growth Fund debuted in April of 1993. Since then, FDGFX has accumulated assets of about $5.90 billion, according to the most recently available information. The fund is currently managed by Zachary Turner who has been in charge of the fund since July of 2020.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 11.89%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 10.39%, which places it in the middle 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 FDGFX over the past three years is 21.49% compared to the category average of 17.65%. Over the past 5 years, the standard deviation of the fund is 17.17% compared to the category average of 14.47%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.07, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. With a negative alpha of -5.05, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
As of the last filing date, the mutual fund has 79.64% of its assets in stocks, with an average market capitalization of $381.63 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
Turnover is 136%, which means, on average, the fund makes fewer trades than comparable funds.Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FDGFX is a no load fund. It has an expense ratio of 0.47% compared to the category average of 0.95%. FDGFX is actually cheaper than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Dividend Growth Fund ( FDGFX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Large Cap Blend 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 FDGFX 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.