Any investors hoping to find a Global - Equity fund could think about starting with Fidelity Trend Fund (FTRNX - Free Report) . FTRNX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Zacks categorizes FTRNX as Global - Equity, which is a segment packed with options. Global - Equity mutual funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. They also provide an investment technique that leverages the diverse nature of the global economy in the hopes of providing a stable return.
History of Fund/Manager
FTRNX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Trend Fund made its debut in December of 1961, and since then, FTRNX has accumulated about $1.86 billion in assets, per the most up-to-date date available. The fund's current manager, Daniel E. Kelley, has been in charge of the fund since January of 2012.
Of course, investors look for strong performance in funds. FTRNX has a 5-year annualized total return of 16.95% and is 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 12.94%, which places it in the top third during this time-frame.
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 11.2%, the standard deviation of FTRNX over the past three years is 11.5%. Looking at the past 5 years, the fund's standard deviation is 11.07% compared to the category average of 10.86%. This makes the fund more volatile than its peers over the past half-decade.
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. FTRNX lost 53.03% in the most recent bear market and underperformed comparable funds by 0.63%. This could mean that the fund is a worse choice than comparable funds during a bear market.
Even still, the fund has a 5-year beta of 1.03, so investors should note that it is hypothetically as volatile as the market at large. 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. FTRNX has generated a positive alpha over the past five years of 1.65, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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 mostly on equities that are traded in the United States.
The mutual fund currently has 90.81% of its holdings in stocks, with an average market capitalization of $253.06 billion. Turnover is 125%, which means this fund makes more trades per year than the comparable average.
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, FTRNX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.20%. From a cost perspective, FTRNX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment has no minimum amount.
Overall, Fidelity Trend Fund has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Trend Fund ooks like a good potential choice for investors right now.
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