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Is Fidelity Select Medical Equipment & Systems (FSMEX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Mutual Fund Equity Report funds, a place to start could be Fidelity Select Medical Equipment & Systems (FSMEX - Free Report) . FSMEX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FSMEX. Fidelity Select Medical Equipment & Systems made its debut in April of 1998, and since then, FSMEX has accumulated about $10.38 billion in assets, per the most up-to-date date available. The fund's current manager, Edward Yoon, has been in charge of the fund since May of 2007.

Performance

Of course, investors look for strong performance in funds. FSMEX has a 5-year annualized total return of 24.76% and is in the top 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 22.79%, 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. Over the past three years, FSMEX's standard deviation comes in at 18.4%, compared to the category average of 19.47%. The standard deviation of the fund over the past 5 years is 16.79% compared to the category average of 17.3%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FSMEX has a 5-year beta of 0.84, which means it 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. FSMEX's 5-year performance has produced a positive alpha of 9.05, which means 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, FSMEX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.33%. So, FSMEX is actually cheaper than its peers from a cost perspective.

This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Select Medical Equipment & Systems ( FSMEX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Medical Equipment & Systems ( FSMEX ) looks like a good potential choice for investors right now.

This could just be the start of your research on FSMEXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.


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