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Is Fidelity Select Utilities (FSUTX) a Strong Mutual Fund Pick Right Now?
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Looking for a Sector - Utilities fund? You may want to consider Fidelity Select Utilities (FSUTX - Free Report) as a possible option. FSUTX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FSUTX in Sector - Utilities, which is a segment packed with options. Known for its stability, the utility industry is perfect for investors seeking low risk. Sector - Utilities mutual funds focus on companies that provide essential services to millions of people on a daily basis: think electric power, gas distribution, and water supply.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSUTX. Fidelity Select Utilities debuted in December of 1981. Since then, FSUTX has accumulated assets of about $1 billion, according to the most recently available information. The fund's current manager, Douglas Simmons, has been in charge of the fund since October of 2006.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 9.63%, and is in the top 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 13.45%, 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. Over the past three years, FSUTX's standard deviation comes in at 10.78%, compared to the category average of -0.02%. Over the past 5 years, the standard deviation of the fund is 11.05% compared to the category average of 1.21%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In FSUTX's case, the fund lost 45.05% in the most recent bear market and underperformed comparable funds by 4505%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 0.36, so it is likely going to be less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a positive alpha over the past 5 years of 5.52, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
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, FSUTX is a no load fund. It has an expense ratio of 0.74% compared to the category average of -43.37%. FSUTX is actually more expensive 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 Select Utilities ( FSUTX ) has a neutral Zacks Mutual Fund rank, strong performance, worse downside risk, and higher fees compared to its peers.
Want even more information about FSUTX? 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. 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 Select Utilities (FSUTX) a Strong Mutual Fund Pick Right Now?
Looking for a Sector - Utilities fund? You may want to consider Fidelity Select Utilities (FSUTX - Free Report) as a possible option. FSUTX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FSUTX in Sector - Utilities, which is a segment packed with options. Known for its stability, the utility industry is perfect for investors seeking low risk. Sector - Utilities mutual funds focus on companies that provide essential services to millions of people on a daily basis: think electric power, gas distribution, and water supply.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FSUTX. Fidelity Select Utilities debuted in December of 1981. Since then, FSUTX has accumulated assets of about $1 billion, according to the most recently available information. The fund's current manager, Douglas Simmons, has been in charge of the fund since October of 2006.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 9.63%, and is in the top 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 13.45%, 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. Over the past three years, FSUTX's standard deviation comes in at 10.78%, compared to the category average of -0.02%. Over the past 5 years, the standard deviation of the fund is 11.05% compared to the category average of 1.21%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In FSUTX's case, the fund lost 45.05% in the most recent bear market and underperformed comparable funds by 4505%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 0.36, so it is likely going to be less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a positive alpha over the past 5 years of 5.52, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
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, FSUTX is a no load fund. It has an expense ratio of 0.74% compared to the category average of -43.37%. FSUTX is actually more expensive 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 Select Utilities ( FSUTX ) has a neutral Zacks Mutual Fund rank, strong performance, worse downside risk, and higher fees compared to its peers.
Want even more information about FSUTX? 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. 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.