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Is Fidelity Equity-Income Fund (FEQIX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Large Cap Value funds, consider Fidelity Equity-Income Fund (FEQIX - Free Report) as a possibility. FEQIX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Large Cap Value mutual funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value; this value investing strategy often leads to low P/E ratios and high dividend yields, though growth levels are often curtailed. The high-growth opportunity of these funds are slowed even further, as large-cap securities are generally in stable industries with low to moderate growth prospects. Therefore, Large Cap Value funds are usually more appealing to investors who are interested in a stable income stream.
History of Fund/Manager
FEQIX is a part of the Fidelity family of funds, a company based out of Boston, MA. Since Fidelity Equity-Income Fund made its debut in May of 1966, FEQIX has garnered more than $5.47 billion in assets. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 9.07%, and is in the bottom third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 12.91%, which places it in the middle 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. Over the past three years, FEQIX's standard deviation comes in at 9.21%, compared to the category average of 9.66%. Looking at the past 5 years, the fund's standard deviation is 9.42% compared to the category average of 9.35%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. FEQIX lost 57.1% in the most recent bear market and outperformed its peer group by 6.79%. This could mean that the fund is a better choice than comparable funds during a bear market.
Even still, the fund has a 5-year beta of 0.93, so investors should note that it is hypothetically less 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. FEQIX's 5-year performance has produced a negative alpha of -3.49, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, FEQIX is a no load fund. It has an expense ratio of 0.61% compared to the category average of 1.03%. FEQIX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Equity-Income Fund ( FEQIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Fidelity Equity-Income Fund ( FEQIX ) looks like a great potential choice for investors right now.
Want even more information about FEQIX? 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. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is Fidelity Equity-Income Fund (FEQIX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Large Cap Value funds, consider Fidelity Equity-Income Fund (FEQIX - Free Report) as a possibility. FEQIX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Large Cap Value mutual funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value; this value investing strategy often leads to low P/E ratios and high dividend yields, though growth levels are often curtailed. The high-growth opportunity of these funds are slowed even further, as large-cap securities are generally in stable industries with low to moderate growth prospects. Therefore, Large Cap Value funds are usually more appealing to investors who are interested in a stable income stream.
History of Fund/Manager
FEQIX is a part of the Fidelity family of funds, a company based out of Boston, MA. Since Fidelity Equity-Income Fund made its debut in May of 1966, FEQIX has garnered more than $5.47 billion in assets. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 9.07%, and is in the bottom third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 12.91%, which places it in the middle 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. Over the past three years, FEQIX's standard deviation comes in at 9.21%, compared to the category average of 9.66%. Looking at the past 5 years, the fund's standard deviation is 9.42% compared to the category average of 9.35%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. FEQIX lost 57.1% in the most recent bear market and outperformed its peer group by 6.79%. This could mean that the fund is a better choice than comparable funds during a bear market.
Even still, the fund has a 5-year beta of 0.93, so investors should note that it is hypothetically less 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. FEQIX's 5-year performance has produced a negative alpha of -3.49, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, FEQIX is a no load fund. It has an expense ratio of 0.61% compared to the category average of 1.03%. FEQIX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Equity-Income Fund ( FEQIX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Fidelity Equity-Income Fund ( FEQIX ) looks like a great potential choice for investors right now.
Want even more information about FEQIX? 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. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.