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Is Fidelity Magellan Fund (FMAGX) a Strong Mutual Fund Pick Right Now?
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Large Cap Blend fund seekers should consider taking a look at Fidelity Magellan Fund (FMAGX - Free Report) . FMAGX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FMAGX is classified in the Large Cap Blend segment by Zacks, which is an area full of potential. Targeting companies with market caps of more than $10 billion, Large Cap Blend mutual funds offer a stable investment choice; these funds are perfect for investors with a " buy and hold " mindset. Since blended funds mix large, more established firms into their portfolios, investors are exposed to both value and growth opportunities.
History of Fund/Manager
Fidelity is responsible for FMAGX, and the company is based out of Boston, MA. Fidelity Magellan Fund made its debut in May of 1963, and since then, FMAGX has accumulated about $14.64 billion in assets, per the most up-to-date date available. The fund's current manager, Jeffrey S. Feingold, has been in charge of the fund since September of 2011.
Performance
Of course, investors look for strong performance in funds. FMAGX has a 5-year annualized total return of 10.97% and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 10.78%, 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. Over the past three years, FMAGX's standard deviation comes in at 11.24%, compared to the category average of 10.13%. Looking at the past 5 years, the fund's standard deviation is 11.41% compared to the category average of 10.25%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, FMAGX lost 58.26% and underperformed its peer group by 9.48%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.1, so investors should note that 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. FMAGX's 5-year performance has produced a negative alpha of -0.99, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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 mostly on equities that are traded in the United States.
As of the last filing date, the mutual fund has 93.57% of its assets in stocks, which have an average market capitalization of $256.72 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Turnover is 53%, which means this fund makes fewer trades than the average comparable fund.
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, FMAGX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 1.10%. So, FMAGX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $2,500, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Magellan Fund ( FMAGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Want even more information about FMAGX? 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 Magellan Fund (FMAGX) a Strong Mutual Fund Pick Right Now?
Large Cap Blend fund seekers should consider taking a look at Fidelity Magellan Fund (FMAGX - Free Report) . FMAGX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FMAGX is classified in the Large Cap Blend segment by Zacks, which is an area full of potential. Targeting companies with market caps of more than $10 billion, Large Cap Blend mutual funds offer a stable investment choice; these funds are perfect for investors with a " buy and hold " mindset. Since blended funds mix large, more established firms into their portfolios, investors are exposed to both value and growth opportunities.
History of Fund/Manager
Fidelity is responsible for FMAGX, and the company is based out of Boston, MA. Fidelity Magellan Fund made its debut in May of 1963, and since then, FMAGX has accumulated about $14.64 billion in assets, per the most up-to-date date available. The fund's current manager, Jeffrey S. Feingold, has been in charge of the fund since September of 2011.
Performance
Of course, investors look for strong performance in funds. FMAGX has a 5-year annualized total return of 10.97% and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 10.78%, 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. Over the past three years, FMAGX's standard deviation comes in at 11.24%, compared to the category average of 10.13%. Looking at the past 5 years, the fund's standard deviation is 11.41% compared to the category average of 10.25%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, FMAGX lost 58.26% and underperformed its peer group by 9.48%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.1, so investors should note that 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. FMAGX's 5-year performance has produced a negative alpha of -0.99, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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 mostly on equities that are traded in the United States.
As of the last filing date, the mutual fund has 93.57% of its assets in stocks, which have an average market capitalization of $256.72 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
Turnover is 53%, which means this fund makes fewer trades than the average comparable fund.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, FMAGX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 1.10%. So, FMAGX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $2,500, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Magellan Fund ( FMAGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Want even more information about FMAGX? 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.