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Is Fidelity Contrafund K (FCNKX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Large Cap Growth category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Contrafund K (FCNKX - Free Report) . FCNKX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FCNKX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FCNKX. The Fidelity Contrafund K made its debut in May of 2008 and FCNKX has managed to accumulate roughly $23.79 billion in assets, as of the most recently available information. The fund's current manager, William Danoff, has been in charge of the fund since May of 2008.
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 11.72%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 15.02%, 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, FCNKX's standard deviation comes in at 13.85%, compared to the category average of 11.73%. The standard deviation of the fund over the past 5 years is 12.76% compared to the category average of 11.63%. 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.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FCNKX has a 5-year beta of 0.99, which means it is likely to be as volatile as 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. With a positive alpha of 1.03, managers in this portfolio are skilled in picking 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.
The mutual fund currently has 97.35% of its holdings in stocks, which have an average market capitalization of $263.60 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Retail Trade
Turnover is 32%, which means, on average, the fund makes fewer trades than comparable funds.
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, FCNKX is a no load fund. It has an expense ratio of 0.77% compared to the category average of 1.08%. So, FCNKX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Contrafund K ( FCNKX ) 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.
Your research on the Large Cap Growth 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is Fidelity Contrafund K (FCNKX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Large Cap Growth category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Contrafund K (FCNKX - Free Report) . FCNKX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FCNKX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FCNKX. The Fidelity Contrafund K made its debut in May of 2008 and FCNKX has managed to accumulate roughly $23.79 billion in assets, as of the most recently available information. The fund's current manager, William Danoff, has been in charge of the fund since May of 2008.
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 11.72%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 15.02%, 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, FCNKX's standard deviation comes in at 13.85%, compared to the category average of 11.73%. The standard deviation of the fund over the past 5 years is 12.76% compared to the category average of 11.63%. 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.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FCNKX has a 5-year beta of 0.99, which means it is likely to be as volatile as 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. With a positive alpha of 1.03, managers in this portfolio are skilled in picking 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.
The mutual fund currently has 97.35% of its holdings in stocks, which have an average market capitalization of $263.60 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
- Retail Trade
Turnover is 32%, which means, on average, the fund makes fewer trades than comparable funds.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, FCNKX is a no load fund. It has an expense ratio of 0.77% compared to the category average of 1.08%. So, FCNKX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Contrafund K ( FCNKX ) 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.
Your research on the Large Cap Growth 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.