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Is Fidelity Select Defense & Aerospace (FSDAX) a Strong Mutual Fund Pick Right Now?
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Looking for a Mutual Fund Equity Report fund? You may want to consider Fidelity Select Defense & Aerospace (FSDAX - Free Report) as a possible option. FSDAX bears a Zacks Mutual Fund Rank of 3 (Hold), 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 FSDAX. Fidelity Select Defense & Aerospace made its debut in May of 1984, and since then, FSDAX has accumulated about $1.46 billion in assets, per the most up-to-date date available. The fund's current manager, Clayton Pfannenstiel, has been in charge of the fund since December of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 5.07%, and it sits in the bottom 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 -0.3%, which places it in the bottom 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, FSDAX's standard deviation comes in at 28.7%, compared to the category average of 26.47%. Looking at the past 5 years, the fund's standard deviation is 25.55% compared to the category average of 23.75%. 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. FSDAX has a 5-year beta of 1.08, which means it is likely to be more volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. FSDAX's 5-year performance has produced a negative alpha of -4.59, which means 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, FSDAX is a no load fund. It has an expense ratio of 0.75% compared to the category average of 1.25%. Looking at the fund from a cost perspective, FSDAX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Select Defense & Aerospace ( FSDAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Want even more information about FSDAX? 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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Is Fidelity Select Defense & Aerospace (FSDAX) a Strong Mutual Fund Pick Right Now?
Looking for a Mutual Fund Equity Report fund? You may want to consider Fidelity Select Defense & Aerospace (FSDAX - Free Report) as a possible option. FSDAX bears a Zacks Mutual Fund Rank of 3 (Hold), 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 FSDAX. Fidelity Select Defense & Aerospace made its debut in May of 1984, and since then, FSDAX has accumulated about $1.46 billion in assets, per the most up-to-date date available. The fund's current manager, Clayton Pfannenstiel, has been in charge of the fund since December of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 5.07%, and it sits in the bottom 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 -0.3%, which places it in the bottom 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, FSDAX's standard deviation comes in at 28.7%, compared to the category average of 26.47%. Looking at the past 5 years, the fund's standard deviation is 25.55% compared to the category average of 23.75%. 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. FSDAX has a 5-year beta of 1.08, which means it is likely to be more volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. FSDAX's 5-year performance has produced a negative alpha of -4.59, which means 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, FSDAX is a no load fund. It has an expense ratio of 0.75% compared to the category average of 1.25%. Looking at the fund from a cost perspective, FSDAX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Select Defense & Aerospace ( FSDAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Want even more information about FSDAX? 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.