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Is Fidelity Small Cap Growth (FCPGX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Mutual Fund Equity Report funds, it would not be wise to start your search with Fidelity Small Cap Growth (FCPGX - Free Report) . FCPGX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FCPGX. The Fidelity Small Cap Growth made its debut in November of 2004 and FCPGX has managed to accumulate roughly $2.74 billion in assets, as of the most recently available information. The fund is currently managed by Patrick Venanzi who has been in charge of the fund since November of 2011.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 8.65%, 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 6.82%, 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. The standard deviation of FCPGX over the past three years is 25.33% compared to the category average of 18.68%. The standard deviation of the fund over the past 5 years is 22.85% compared to the category average of 16.45%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 1.08, the fund is likely to be more 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. FCPGX's 5-year performance has produced a negative alpha of -0.68, which means managers in this portfolio find it difficult to pick 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.

The mutual fund currently has 97.65% of its holdings in stocks, which have an average market capitalization of $5.38 billion. The fund has the heaviest exposure to the following market sectors:

  • Technology
  • Health
  • Industrial Cyclical
  • Other
Turnover is 79%, which means, on average, the fund makes more trades per year than the comparable average.

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, FCPGX is a no load fund. It has an expense ratio of 1.01% compared to the category average of 1.20%. Looking at the fund from a cost perspective, FCPGX is actually cheaper than its peers.

This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Small Cap Growth ( FCPGX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Fidelity Small Cap Growth ( FCPGX ) looks like a somewhat weak choice for investors right now.

Don't stop here for your research on Mutual Fund Equity Report funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FCPGX to its peers 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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