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Is Fidelity Growth Company (FDGRX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Large Cap Growth fund? Fidelity Growth Company (FDGRX - Free Report) is a potential starting point. FDGRX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FDGRX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FDGRX. Fidelity Growth Company made its debut in January of 1983, and since then, FDGRX has accumulated about $64.44 billion in assets, per the most up-to-date date available. The fund is currently managed by Steven S. Wymer who has been in charge of the fund since January of 1997.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 17.51%, and it sits 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 25.04%, 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. Over the past three years, FDGRX's standard deviation comes in at 19.75%, compared to the category average of 16.89%. The fund's standard deviation over the past 5 years is 21.84% compared to the category average of 16.75%. 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 1.23, which means it is hypothetically more volatile than 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 -0.45, which shows that 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 mostly on equities that are traded in the United States.
This fund is currently holding about 92.66% in stocks, and these companies have an average market capitalization of $611.46 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Retail Trade
With turnover at about 18%, this fund makes fewer trades than comparable funds.
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, FDGRX is a no load fund. It has an expense ratio of 0.65% compared to the category average of 0.94%. So, FDGRX 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.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, Fidelity Growth Company ( FDGRX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
This could just be the start of your research on FDGRX in the Large Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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 Growth Company (FDGRX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Large Cap Growth fund? Fidelity Growth Company (FDGRX - Free Report) is a potential starting point. FDGRX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FDGRX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FDGRX. Fidelity Growth Company made its debut in January of 1983, and since then, FDGRX has accumulated about $64.44 billion in assets, per the most up-to-date date available. The fund is currently managed by Steven S. Wymer who has been in charge of the fund since January of 1997.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 17.51%, and it sits 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 25.04%, 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. Over the past three years, FDGRX's standard deviation comes in at 19.75%, compared to the category average of 16.89%. The fund's standard deviation over the past 5 years is 21.84% compared to the category average of 16.75%. 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 1.23, which means it is hypothetically more volatile than 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 -0.45, which shows that 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 mostly on equities that are traded in the United States.
This fund is currently holding about 92.66% in stocks, and these companies have an average market capitalization of $611.46 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 18%, this fund makes fewer trades than comparable funds.
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, FDGRX is a no load fund. It has an expense ratio of 0.65% compared to the category average of 0.94%. So, FDGRX 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.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, Fidelity Growth Company ( FDGRX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
This could just be the start of your research on FDGRX in the Large Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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.