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Is Fidelity Trend Fund (FTRNX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Global - Equity category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Trend Fund (FTRNX - Free Report) . FTRNX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FTRNX is a Global - Equity option, an investment area loaded with different options. While Global - Equity mutual funds invest their assets in large markets--think the U.S., Europe, and Japan--they aren't limited by geography. Their investment technique is one that leverages the global economy in order to offer stable returns.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FTRNX. Fidelity Trend Fund debuted in December of 1961. Since then, FTRNX has accumulated assets of about $2.03 billion, according to the most recently available information. The fund is currently managed by Daniel E. Kelley who has been in charge of the fund since January of 2012.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 15.9%, 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 20.04%, 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. The standard deviation of FTRNX over the past three years is 10.69% compared to the category average of 11.11%. Over the past 5 years, the standard deviation of the fund is 10.98% compared to the category average of 10.77%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In the most recent bear market, FTRNX lost 53.03% and outperformed its peer group by 0.59%. This might suggest that the fund is a better choice than its peers during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 1.05, which means it is hypothetically more volatile than the market at large. 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. Over the past 5 years, the fund has a positive alpha of 1.3. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is primarily on equities that are traded in the United States.
Currently, this mutual fund is holding 92.31% stock in stocks, with an average market capitalization of $292.30 billion. Turnover is 110%, which means, on average, the fund makes more trades per year than the comparable average.
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, FTRNX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.19%. From a cost perspective, FTRNX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Trend Fund ( FTRNX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Global - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FTRNX too 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 Trend Fund (FTRNX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Global - Equity category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Trend Fund (FTRNX - Free Report) . FTRNX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FTRNX is a Global - Equity option, an investment area loaded with different options. While Global - Equity mutual funds invest their assets in large markets--think the U.S., Europe, and Japan--they aren't limited by geography. Their investment technique is one that leverages the global economy in order to offer stable returns.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FTRNX. Fidelity Trend Fund debuted in December of 1961. Since then, FTRNX has accumulated assets of about $2.03 billion, according to the most recently available information. The fund is currently managed by Daniel E. Kelley who has been in charge of the fund since January of 2012.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 15.9%, 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 20.04%, 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. The standard deviation of FTRNX over the past three years is 10.69% compared to the category average of 11.11%. Over the past 5 years, the standard deviation of the fund is 10.98% compared to the category average of 10.77%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In the most recent bear market, FTRNX lost 53.03% and outperformed its peer group by 0.59%. This might suggest that the fund is a better choice than its peers during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 1.05, which means it is hypothetically more volatile than the market at large. 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. Over the past 5 years, the fund has a positive alpha of 1.3. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is primarily on equities that are traded in the United States.
Currently, this mutual fund is holding 92.31% stock in stocks, with an average market capitalization of $292.30 billion. Turnover is 110%, which means, on average, the fund makes more trades per year than the comparable average.
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, FTRNX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.19%. From a cost perspective, FTRNX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Trend Fund ( FTRNX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Global - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FTRNX too 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.