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Is Fidelity Select Financial Services (FIDSX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Sector - Finance funds, consider Fidelity Select Financial Services (FIDSX - Free Report) as a possibility. FIDSX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FIDSX is classified in the Sector - Finance segment by Zacks, and this area is full of possibilities. The financial space is notoriously large, complex, and heavily-regulated, and Sector - Finance mutual funds give investors a stable, diversified approach to investing in this industry. These funds can include everything from banks and investment giants to exchanges and insurance companies, though investors should note that interest rates could have a big impact.
History of Fund/Manager
FIDSX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Select Financial Services made its debut in December of 1981, and since then, FIDSX has accumulated about $1.09 billion in assets, per the most up-to-date date available. Matt Reed is the fund's current manager and has held that role since June of 2019.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 21.22%, 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 20.22%, 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, FIDSX's standard deviation comes in at 20.64%, compared to the category average of 23.48%. The standard deviation of the fund over the past 5 years is 21.24% compared to the category average of 22.64%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.01, the fund is likely to be as volatile as 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. With a positive alpha of 6.61, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Exploring 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 82.76% of its holdings in stocks, which have an average market capitalization of $132.53 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
With turnover at about 35%, this fund is making more trades in a given year than the category average.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, FIDSX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 1.27%. FIDSX is actually cheaper than its peers when you consider factors like cost.
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 Select Financial Services ( FIDSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Financial Services ( FIDSX ) looks like a good potential choice for investors right now.
Want even more information about FIDSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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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Is Fidelity Select Financial Services (FIDSX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Sector - Finance funds, consider Fidelity Select Financial Services (FIDSX - Free Report) as a possibility. FIDSX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
FIDSX is classified in the Sector - Finance segment by Zacks, and this area is full of possibilities. The financial space is notoriously large, complex, and heavily-regulated, and Sector - Finance mutual funds give investors a stable, diversified approach to investing in this industry. These funds can include everything from banks and investment giants to exchanges and insurance companies, though investors should note that interest rates could have a big impact.
History of Fund/Manager
FIDSX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Select Financial Services made its debut in December of 1981, and since then, FIDSX has accumulated about $1.09 billion in assets, per the most up-to-date date available. Matt Reed is the fund's current manager and has held that role since June of 2019.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 21.22%, 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 20.22%, 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, FIDSX's standard deviation comes in at 20.64%, compared to the category average of 23.48%. The standard deviation of the fund over the past 5 years is 21.24% compared to the category average of 22.64%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.01, the fund is likely to be as volatile as 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. With a positive alpha of 6.61, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Exploring 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 82.76% of its holdings in stocks, which have an average market capitalization of $132.53 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 35%, this fund is making more trades in a given year than the category average.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, FIDSX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 1.27%. FIDSX is actually cheaper than its peers when you consider factors like cost.
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 Select Financial Services ( FIDSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Financial Services ( FIDSX ) looks like a good potential choice for investors right now.
Want even more information about FIDSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.