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Is Fidelity Advisor Biotechnology A (FBTAX) a Strong Mutual Fund Pick Right Now?

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Having trouble finding a Sector - Health fund? Fidelity Advisor Biotechnology A (FBTAX - Free Report) is a possible starting point. FBTAX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We note that FBTAX is a Sector - Health fund, and this area is also loaded with various options. Sector - Health mutual funds give investors an opportunity to focus on one of the largest sectors of the American economy, healthcare. Funds in this category can include everything from for-profit hospitals to pharmaceutical companies and medical device manufacturers.

History of Fund/Manager

FBTAX finds itself in the Fidelity family, based out of Boston, MA. The Fidelity Advisor Biotechnology A made its debut in December of 2000 and FBTAX has managed to accumulate roughly $769.74 million in assets, as of the most recently available information. The fund is currently managed by Eirene Kontopoulos who has been in charge of the fund since July of 2018.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 12.12%, and is 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 11.3%, 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 FBTAX over the past three years is 22.21% compared to the category average of 15.82%. The standard deviation of the fund over the past 5 years is 22.2% compared to the category average of 13.4%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FBTAX has a 5-year beta of 0.93, 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. FBTAX's 5-year performance has produced a negative alpha of -2.03, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, FBTAX is a load fund. It has an expense ratio of 1.01% compared to the category average of 1.32%. FBTAX is actually cheaper than its peers when you consider factors like cost.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Advisor Biotechnology A ( FBTAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

Your research on the Sector - Health 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 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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