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Is Fidelity Select Consumer Staples (FDFAX) 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 Consumer Staples (FDFAX - Free Report) . FDFAX possesses a Zacks Mutual Fund Rank of 2 (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 FDFAX. Fidelity Select Consumer Staples made its debut in July of 1985, and since then, FDFAX has accumulated about $888.93 million in assets, per the most up-to-date date available. The fund's current manager, Ben Shuleva, has been in charge of the fund since January of 2020.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 6.72%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 9.31%, 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. Compared to the category average of 15.74%, the standard deviation of FDFAX over the past three years is 15.62%. The fund's standard deviation over the past 5 years is 14.95% compared to the category average of 14.1%. This makes the fund more 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. FDFAX has a 5-year beta of 0.64, 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. The fund has produced a negative alpha over the past 5 years of -0.99, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

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, FDFAX is a no load fund. It has an expense ratio of 0.73% compared to the category average of 1.25%. FDFAX is actually cheaper than its peers when you consider factors like cost.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Select Consumer Staples ( FDFAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Fidelity Select Consumer Staples ( FDFAX ) looks like a good potential choice for investors right now.

Want even more information about FDFAX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.


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