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Is Fidelity International Small Cap Opportunities (FSCOX) a Strong Mutual Fund Pick Right Now?

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On the lookout for a Non US - Equity fund? Starting with Fidelity International Small Cap Opportunities (FSCOX - Free Report) is one possibility. FSCOX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

FSCOX is classified in the Non US - Equity area by Zacks, and this segment is full of potential. Non US - Equity funds focus their investments on companies outside of the United States, which is an important distinction since global mutual funds tend to keep a sizable portion of their portfolio based in the United States. Most of these funds will allocate across emerging and developed markets, and can often extend across cap levels too.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FSCOX. The Fidelity International Small Cap Opportunities made its debut in August of 2005 and FSCOX has managed to accumulate roughly $755.31 million in assets, as of the most recently available information. Jed Weiss is the fund's current manager and has held that role since December 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 6.65%, and it sits 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 0.56%, which places it in the top third during this time-frame.

It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.

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. FSCOX's standard deviation over the past three years is 20.96% compared to the category average of 15.27%. The fund's standard deviation over the past 5 years is 19.9% compared to the category average of 16.21%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 0.97, so it is likely going to be as volatile as the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. The fund has produced a negative alpha over the past 5 years of -6.49, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

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, FSCOX is a no load fund. It has an expense ratio of 1% compared to the category average of 1%. So, FSCOX is actually on par with 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.

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, Fidelity International Small Cap Opportunities ( FSCOX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and on par fees, Fidelity International Small Cap Opportunities ( FSCOX ) looks like a good potential choice for investors right now.

For additional information on the Non US - Equity area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FSCOX too 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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