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Is Fidelity OTC Portfolio (FOCPX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Large Cap Growth fund? Well, Fidelity OTC Portfolio (FOCPX - Free Report) would not be a good potential starting point right now. FOCPX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FOCPX 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 FOCPX. The Fidelity OTC Portfolio made its debut in December of 1984 and FOCPX has managed to accumulate roughly $14.27 billion in assets, as of the most recently available information. The fund is currently managed by Christopher Lin who has been in charge of the fund since September of 2017.
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 16.4%, 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 23.16%, 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, FOCPX's standard deviation comes in at 15.46%, compared to the category average of 11.56%. Looking at the past 5 years, the fund's standard deviation is 16.23% compared to the category average of 11.62%. 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, FOCPX lost 53.58% and underperformed comparable funds by 5%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.2, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a positive alpha over the past 5 years of 2.7, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Examining 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 principally on equities that are traded in the United States.
Right now, 91.15% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $428.81 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Retail Trade
Turnover is 34%, which means this fund makes fewer trades than comparable funds.
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, FOCPX is a no load fund. It has an expense ratio of 0.88% compared to the category average of 1.06%. So, FOCPX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity OTC Portfolio ( FOCPX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity OTC Portfolio ( FOCPX ) looks like a somewhat weak choice for investors right now.
Want even more information about FOCPX? 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. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is Fidelity OTC Portfolio (FOCPX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Large Cap Growth fund? Well, Fidelity OTC Portfolio (FOCPX - Free Report) would not be a good potential starting point right now. FOCPX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FOCPX 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 FOCPX. The Fidelity OTC Portfolio made its debut in December of 1984 and FOCPX has managed to accumulate roughly $14.27 billion in assets, as of the most recently available information. The fund is currently managed by Christopher Lin who has been in charge of the fund since September of 2017.
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 16.4%, 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 23.16%, 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, FOCPX's standard deviation comes in at 15.46%, compared to the category average of 11.56%. Looking at the past 5 years, the fund's standard deviation is 16.23% compared to the category average of 11.62%. 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, FOCPX lost 53.58% and underperformed comparable funds by 5%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.2, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a positive alpha over the past 5 years of 2.7, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Examining 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 principally on equities that are traded in the United States.
Right now, 91.15% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $428.81 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Retail Trade
Turnover is 34%, which means this fund makes fewer trades than comparable funds.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, FOCPX is a no load fund. It has an expense ratio of 0.88% compared to the category average of 1.06%. So, FOCPX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity OTC Portfolio ( FOCPX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity OTC Portfolio ( FOCPX ) looks like a somewhat weak choice for investors right now.
Want even more information about FOCPX? 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. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.