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Is Fidelity Select Consumer Staples (FDFAX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Sector - Other funds, you might want to consider passing on by Fidelity Select Consumer Staples (FDFAX - Free Report) as a possibility. FDFAX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Fidelity is responsible for FDFAX, and the company is based out of Boston, MA. Fidelity Select Consumer Staples debuted in July of 1985. Since then, FDFAX has accumulated assets of about $890.10 million, according to the most recently available information. James McElligott is the fund's current manager and has held that role since November of 2017.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 6.69%, 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 5.43%, 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, FDFAX's standard deviation comes in at 10.21%, compared to the category average of 9.64%. The standard deviation of the fund over the past 5 years is 11.11% compared to the category average of 9.42%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In the most recent bear market, FDFAX lost 32.46% and underperformed its peer group by 15.95%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
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 0.75, which means it is likely to be less 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. FDFAX has generated a negative alpha over the past five years of -3.51, demonstrating that managers in this portfolio find it difficult to pick 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, FDFAX is a no load fund. It has an expense ratio of 0.76% compared to the category average of 1.14%. From a cost perspective, FDFAX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Select Consumer Staples ( FDFAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Consumer Staples ( FDFAX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on FDFAXin the Sector - Other 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. 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 Consumer Staples (FDFAX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Sector - Other funds, you might want to consider passing on by Fidelity Select Consumer Staples (FDFAX - Free Report) as a possibility. FDFAX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Fidelity is responsible for FDFAX, and the company is based out of Boston, MA. Fidelity Select Consumer Staples debuted in July of 1985. Since then, FDFAX has accumulated assets of about $890.10 million, according to the most recently available information. James McElligott is the fund's current manager and has held that role since November of 2017.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 6.69%, 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 5.43%, 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, FDFAX's standard deviation comes in at 10.21%, compared to the category average of 9.64%. The standard deviation of the fund over the past 5 years is 11.11% compared to the category average of 9.42%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In the most recent bear market, FDFAX lost 32.46% and underperformed its peer group by 15.95%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
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 0.75, which means it is likely to be less 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. FDFAX has generated a negative alpha over the past five years of -3.51, demonstrating that managers in this portfolio find it difficult to pick 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, FDFAX is a no load fund. It has an expense ratio of 0.76% compared to the category average of 1.14%. From a cost perspective, FDFAX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Select Consumer Staples ( FDFAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Consumer Staples ( FDFAX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on FDFAXin the Sector - Other 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. 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.