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Is Fidelity Select Software & IT Services (FSCSX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Sector - Tech category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Select Software & IT Services (FSCSX - Free Report) . FSCSX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FSCSX is part of the Sector - Tech category, which boasts an array of different possible selections. With a much more diversified approach, Sector - Tech mutual funds give investors a way to own a stake in a notoriously risky sector. Tech companies are in various industries like semiconductors, software, internet, and networking, among others.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSCSX. The Fidelity Select Software & IT Services made its debut in July of 1985 and FSCSX has managed to accumulate roughly $10.77 billion in assets, as of the most recently available information. The fund's current manager, Ali Khan, has been in charge of the fund since July of 2014.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 15.11%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.58%, which places it in the middle 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. Compared to the category average of 25.39%, the standard deviation of FSCSX over the past three years is 21.58%. Over the past 5 years, the standard deviation of the fund is 21.74% compared to the category average of 25.14%. This makes the fund less 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. FSCSX has a 5-year beta of 1.07, which means it is likely to be more volatile than the market average. 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. FSCSX's 5-year performance has produced a positive alpha of 0.36, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, FSCSX is a no load fund. It has an expense ratio of 0.62% compared to the category average of 1.26%. From a cost perspective, FSCSX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Fidelity Select Software & IT Services ( FSCSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.
Don't stop here for your research on Sector - Tech 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 FSCSX 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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Is Fidelity Select Software & IT Services (FSCSX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Sector - Tech category, but where should you start your research? Well, one fund that might be worth investigating is Fidelity Select Software & IT Services (FSCSX - Free Report) . FSCSX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FSCSX is part of the Sector - Tech category, which boasts an array of different possible selections. With a much more diversified approach, Sector - Tech mutual funds give investors a way to own a stake in a notoriously risky sector. Tech companies are in various industries like semiconductors, software, internet, and networking, among others.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSCSX. The Fidelity Select Software & IT Services made its debut in July of 1985 and FSCSX has managed to accumulate roughly $10.77 billion in assets, as of the most recently available information. The fund's current manager, Ali Khan, has been in charge of the fund since July of 2014.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 15.11%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.58%, which places it in the middle 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. Compared to the category average of 25.39%, the standard deviation of FSCSX over the past three years is 21.58%. Over the past 5 years, the standard deviation of the fund is 21.74% compared to the category average of 25.14%. This makes the fund less 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. FSCSX has a 5-year beta of 1.07, which means it is likely to be more volatile than the market average. 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. FSCSX's 5-year performance has produced a positive alpha of 0.36, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, FSCSX is a no load fund. It has an expense ratio of 0.62% compared to the category average of 1.26%. From a cost perspective, FSCSX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Fidelity Select Software & IT Services ( FSCSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.
Don't stop here for your research on Sector - Tech 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 FSCSX 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.