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Is Fidelity Select Consumer Finance (FSVLX) a Strong Mutual Fund Pick Right Now?
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Sector - Finance fund seekers should consider taking a look at Fidelity Select Consumer Finance (FSVLX - Free Report) . FSVLX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FSVLX is one of many Sector - Finance funds to choose from. Sector - Finance mutual funds provide investors with a diversified and stabilized investment approach focused on the financial space, which is a notoriously large, complex, and heavily-regulated industry. These funds include everything from insurance companies and exchanges to banks and investment giants; interest rates can impact the players of this space as well.
History of Fund/Manager
FSVLX finds itself in the Fidelity family, based out of Boston, MA. Fidelity Select Consumer Finance debuted in December of 1985. Since then, FSVLX has accumulated assets of about $160.34 million, according to the most recently available information. Chuck Culp is the fund's current manager and has held that role since September of 2018.
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 9.43%, 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 14.72%, 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, FSVLX's standard deviation comes in at 14.84%, compared to the category average of 17.14%. Over the past 5 years, the standard deviation of the fund is 15.29% compared to the category average of 16.46%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In FSVLX's case, the fund lost 74.76% in the most recent bear market and underperformed comparable funds by 14%. This might suggest that the fund is a worse choice than its peers during a bear market.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FSVLX has a 5-year beta of 1.07, which means it is likely to be more volatile than the market average. 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 negative alpha over the past 5 years of -0.81, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
The mutual fund currently has 89.12% of its holdings in stocks, with an average market capitalization of $66.90 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
With turnover at about 32%, this fund makes more trades per year than the comparable average.
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, FSVLX is a no load fund. It has an expense ratio of 0.86% compared to the category average of 1.41%. Looking at the fund from a cost perspective, FSVLX is actually cheaper than its peers.
While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Select Consumer Finance ( FSVLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Sector - Finance, make sure to go to www.zacks.com/funds/mutual-funds 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 Consumer Finance (FSVLX) a Strong Mutual Fund Pick Right Now?
Sector - Finance fund seekers should consider taking a look at Fidelity Select Consumer Finance (FSVLX - Free Report) . FSVLX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
FSVLX is one of many Sector - Finance funds to choose from. Sector - Finance mutual funds provide investors with a diversified and stabilized investment approach focused on the financial space, which is a notoriously large, complex, and heavily-regulated industry. These funds include everything from insurance companies and exchanges to banks and investment giants; interest rates can impact the players of this space as well.
History of Fund/Manager
FSVLX finds itself in the Fidelity family, based out of Boston, MA. Fidelity Select Consumer Finance debuted in December of 1985. Since then, FSVLX has accumulated assets of about $160.34 million, according to the most recently available information. Chuck Culp is the fund's current manager and has held that role since September of 2018.
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 9.43%, 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 14.72%, 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, FSVLX's standard deviation comes in at 14.84%, compared to the category average of 17.14%. Over the past 5 years, the standard deviation of the fund is 15.29% compared to the category average of 16.46%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In FSVLX's case, the fund lost 74.76% in the most recent bear market and underperformed comparable funds by 14%. This might suggest that the fund is a worse choice than its peers during a bear market.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FSVLX has a 5-year beta of 1.07, which means it is likely to be more volatile than the market average. 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 negative alpha over the past 5 years of -0.81, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
The mutual fund currently has 89.12% of its holdings in stocks, with an average market capitalization of $66.90 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Technology
With turnover at about 32%, this fund makes more trades per year than the comparable average.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, FSVLX is a no load fund. It has an expense ratio of 0.86% compared to the category average of 1.41%. Looking at the fund from a cost perspective, FSVLX is actually cheaper than its peers.
While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Select Consumer Finance ( FSVLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Sector - Finance, make sure to go to www.zacks.com/funds/mutual-funds 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.