Is Fidelity Growth & Income Portfolio (FGRIX) a Strong Mutual Fund Pick Right Now?

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On the lookout for a Large Cap Blend fund? Starting with Fidelity Growth & Income Portfolio (FGRIX) is one possibility. FGRIX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

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Objective

FGRIX is classified in the Large Cap Blend segment by Zacks, which is an area full of potential. Targeting companies with market caps of more than $10 billion, Large Cap Blend mutual funds offer a stable investment choice; these funds are perfect for investors with a ” buy and hold ” mindset. Since blended funds mix large, more established firms into their portfolios, investors are exposed to both value and growth opportunities.

History of Fund/Manager

FGRIX is a part of the Fidelity family of funds, a company based out of Boston, MA. Since Fidelity Growth & Income Portfolio made its debut in December of 1985, FGRIX has garnered more than $7.05 billion in assets. The fund’s current manager, Matthew Fruhan, has been in charge of the fund since February of 2011.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 13.36%, and it sits 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 11.77%, 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. The standard deviation of FGRIX over the past three years is 20.07% compared to the category average of 17.81%. The standard deviation of the fund over the past 5 years is 16.33% compared to the category average of 14.59%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. FGRIX has a 5-year beta of 1.02, which means it is likely to be as volatile as 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 -3.16, 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 principally on equities that are traded in the United States.

This fund is currently holding about 84.82% stock in stocks, with an average market capitalization of $298.69 billion. The fund has the heaviest exposure to the following market sectors:

  1. Finance
  2. Technology
  3. Industrial Cyclical

Turnover is about 22%, so those in charge of the fund make 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, FGRIX is a no load fund. It has an expense ratio of 0.59% compared to the category average of 0.95%. From a cost perspective, FGRIX is actually cheaper than its peers.

This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Growth & Income Portfolio ( FGRIX ) 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.

Want even more information about FGRIX? 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. Zacks provides a full suite of tools to help you analyze your portfolio – both funds and stocks – in the most efficient way possible.

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