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Is Fidelity Real Estate Investment (FRESX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Sector - Real Estate funds, consider Fidelity Real Estate Investment (FRESX - Free Report) as a possibility. FRESX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FRESX in Sector - Real Estate, which is a segment packed with options. Real estate investment trusts (REITs) are a popular income vehicle thanks their taxation rules, and Sector - Real Estate mutual funds typically invest in them. A REIT is required to pay out at least 90% of its income annually to avoid double taxation, and this technique makes securities in these funds high dividend players--almost bond-like in some cases--though their risk is similar to equities.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FRESX. Since Fidelity Real Estate Investment made its debut in November of 1986, FRESX has garnered more than $3.90 billion in assets. The fund's current manager, Steve J. Buller, has been in charge of the fund since December of 1997.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 9.53%, and is in the top 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 7.87%, 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, FRESX's standard deviation comes in at 12.45%, compared to the category average of 11.87%. Looking at the past 5 years, the fund's standard deviation is 13.35% compared to the category average of 11.9%. 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. FRESX lost 66.8% in the most recent bear market and outperformed its peer group by 2.88%. These results could imply that the fund is a better 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. FRESX has a 5-year beta of 0.5, 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. The fund has produced a positive alpha over the past 5 years of 2.98, which shows that managers in this portfolio are skilled in picking 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, FRESX is a no load fund. It has an expense ratio of 0.76% compared to the category average of 1.24%. Looking at the fund from a cost perspective, FRESX is actually cheaper than its peers.
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 Real Estate Investment ( FRESX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Real Estate Investment ( FRESX ) looks like a good potential choice for investors right now.
Your research on the Sector - Real Estate segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer 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 Real Estate Investment (FRESX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Sector - Real Estate funds, consider Fidelity Real Estate Investment (FRESX - Free Report) as a possibility. FRESX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FRESX in Sector - Real Estate, which is a segment packed with options. Real estate investment trusts (REITs) are a popular income vehicle thanks their taxation rules, and Sector - Real Estate mutual funds typically invest in them. A REIT is required to pay out at least 90% of its income annually to avoid double taxation, and this technique makes securities in these funds high dividend players--almost bond-like in some cases--though their risk is similar to equities.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FRESX. Since Fidelity Real Estate Investment made its debut in November of 1986, FRESX has garnered more than $3.90 billion in assets. The fund's current manager, Steve J. Buller, has been in charge of the fund since December of 1997.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 9.53%, and is in the top 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 7.87%, 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, FRESX's standard deviation comes in at 12.45%, compared to the category average of 11.87%. Looking at the past 5 years, the fund's standard deviation is 13.35% compared to the category average of 11.9%. 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. FRESX lost 66.8% in the most recent bear market and outperformed its peer group by 2.88%. These results could imply that the fund is a better 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. FRESX has a 5-year beta of 0.5, 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. The fund has produced a positive alpha over the past 5 years of 2.98, which shows that managers in this portfolio are skilled in picking 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, FRESX is a no load fund. It has an expense ratio of 0.76% compared to the category average of 1.24%. Looking at the fund from a cost perspective, FRESX is actually cheaper than its peers.
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 Real Estate Investment ( FRESX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Real Estate Investment ( FRESX ) looks like a good potential choice for investors right now.
Your research on the Sector - Real Estate segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer 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.