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Is Fidelity Advisor Financial Services A (FAFDX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Sector - Finance fund? Fidelity Advisor Financial Services A (FAFDX - Free Report) is a potential starting point. FAFDX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FAFDX is part of the Sector - Finance section, which boasts an array of other possible selections. Sector - Finance funds offer a stable, diversified approach to investing that focuses on the financial industry, an infamously large, complex, and heavily-regulated space. Funds here can include insurance companies and exchanges, as well as banks and investment giants. Investors should note that interest rates may also impact players in this market.
History of Fund/Manager
Fidelity is responsible for FAFDX, and the company is based out of Boston, MA. The Fidelity Advisor Financial Services A made its debut in September of 1996 and FAFDX has managed to accumulate roughly $189.47 million in assets, as of the most recently available information. The fund is currently managed by Matt Reed who has been in charge of the fund since June of 2019.
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 15.29%, and is in the top 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 13.82%, 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 FAFDX over the past three years is 26.62% compared to the category average of 17.53%. Over the past 5 years, the standard deviation of the fund is 21.96% compared to the category average of 14.48%. 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. FAFDX has a 5-year beta of 1.22, which means it is likely to be more volatile than the market average. 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. Over the past 5 years, the fund has a negative alpha of -3.5. This means that managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
Right now, 88.07% of this mutual fund's holdings are stocks, which have an average market capitalization of $79.23 billion. With turnover at about 61%, this fund makes more traders than comparable funds in a given year.
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, FAFDX is a load fund. It has an expense ratio of 1.11% compared to the category average of 1.52%. So, FAFDX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Advisor Financial Services A ( FAFDX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Fidelity Advisor Financial Services A ( FAFDX ) looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Sector - Finance, make sure to go to www.zacks.com/funds/mutual-funds 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 Advisor Financial Services A (FAFDX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Sector - Finance fund? Fidelity Advisor Financial Services A (FAFDX - Free Report) is a potential starting point. FAFDX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FAFDX is part of the Sector - Finance section, which boasts an array of other possible selections. Sector - Finance funds offer a stable, diversified approach to investing that focuses on the financial industry, an infamously large, complex, and heavily-regulated space. Funds here can include insurance companies and exchanges, as well as banks and investment giants. Investors should note that interest rates may also impact players in this market.
History of Fund/Manager
Fidelity is responsible for FAFDX, and the company is based out of Boston, MA. The Fidelity Advisor Financial Services A made its debut in September of 1996 and FAFDX has managed to accumulate roughly $189.47 million in assets, as of the most recently available information. The fund is currently managed by Matt Reed who has been in charge of the fund since June of 2019.
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 15.29%, and is in the top 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 13.82%, 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 FAFDX over the past three years is 26.62% compared to the category average of 17.53%. Over the past 5 years, the standard deviation of the fund is 21.96% compared to the category average of 14.48%. 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. FAFDX has a 5-year beta of 1.22, which means it is likely to be more volatile than the market average. 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. Over the past 5 years, the fund has a negative alpha of -3.5. This means that managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
Right now, 88.07% of this mutual fund's holdings are stocks, which have an average market capitalization of $79.23 billion. With turnover at about 61%, this fund makes more traders than comparable funds in a given year.
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, FAFDX is a load fund. It has an expense ratio of 1.11% compared to the category average of 1.52%. So, FAFDX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Advisor Financial Services A ( FAFDX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Fidelity Advisor Financial Services A ( FAFDX ) looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Sector - Finance, make sure to go to www.zacks.com/funds/mutual-funds 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.