On the lookout for a Mutual Fund Equity Report fund? Starting with Fidelity Advisor New Insights A (FNIAX) should not be a possibility at this time. FNIAX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FNIAX. Fidelity Advisor New Insights A debuted in July of 2003. Since then, FNIAX has accumulated assets of about $5.63 billion, according to the most recently available information. William Danoff is the fund’s current manager and has held that role since July of 2003.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 7.92%, and is in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 6.42%, which places it in the bottom 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, FNIAX’s standard deviation comes in at 21.72%, compared to the category average of 17.98%. The fund’s standard deviation over the past 5 years is 19.43% compared to the category average of 15.81%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.02, which means it is hypothetically as volatile as 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. Over the past 5 years, the fund has a negative alpha of -2.78. This means 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 mostly on equities that are traded in the United States.
This fund is currently holding about 98.04% stock in stocks, which have an average market capitalization of $276.21 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
- Retail Trade
Turnover is 43%, which means, on average, the fund makes fewer trades than comparable funds.
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, FNIAX is a load fund. It has an expense ratio of 0.71% compared to the category average of 0.99%. FNIAX is actually cheaper than its peers when you consider factors like cost.
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 Advisor New Insights A ( FNIAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FNIAX too for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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