On the lookout for a Sector - Health fund? Starting with Fidelity Select Health Care Services (FSHCX Quick QuoteFSHCX - Free Report) is one possibility. FSHCX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes FSHCX as Sector - Health, a segment packed with options. Sector - Health mutual funds offer investors a focus on the healthcare industry, one of the largest sectors in the American economy. These funds can include everything from pharmaceutical companies to medical device manufacturers and for-profit hospitals.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FSHCX. The Fidelity Select Health Care Services made its debut in June of 1986 and FSHCX has managed to accumulate roughly $807.98 million in assets, as of the most recently available information. Justin Segalini is the fund's current manager and has held that role since January of 2016.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 1.22%, and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -4.24%, which places it in the bottom 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, FSHCX's standard deviation comes in at 20.19%, compared to the category average of 15.99%. The fund's standard deviation over the past 5 years is 19.98% compared to the category average of 16.78%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.58, the fund is likely to be less volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. FSHCX has generated a negative alpha over the past five years of -6.8, demonstrating 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, FSHCX is a no load fund and it has an expense ratio of 0.68%.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

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

Bottom Line

This puts this fund from Fidelity in the top 40% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Sector - Health category.

This could just be the start of your research on FSHCX in the Sector - Health 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.