Any investors hoping to find a Mid Cap Value fund could think about starting with Fidelity Value Fund (FDVLX). FDVLX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
We classify FDVLX in the Mid Cap Value category, an area rife with potential choices. Mid Cap Value mutual funds aim to target medium-sized companies that possess strong value and income opportunities for investors. A mid-cap company usually holds a market capitalization of between $2 billion and $10 billion.
History of Fund/Manager
FDVLX finds itself in the Fidelity family, based out of Boston, MA. The Fidelity Value Fund made its debut in December of 1978 and FDVLX has managed to accumulate roughly $6.51 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
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 13.21%, 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 10.48%, 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, FDVLX’s standard deviation comes in at 28.11%, compared to the category average of 19.44%. The fund’s standard deviation over the past 5 years is 22.45% compared to the category average of 16.05%. This makes the fund more volatile than its peers over the past half-decade.
The fund has a 5-year beta of 1.38, so investors should note that it is hypothetically more 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 negative alpha over the past 5 years of -7.38, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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.
As of the last filing date, the mutual fund has 91.05% of its assets in stocks, with an average market capitalization of $12.06 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 90%, this fund is making more traders than comparable funds in a given year.
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, FDVLX is a no load fund. It has an expense ratio of 0.55% compared to the category average of 1.12%. So, FDVLX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Overall, Fidelity Value Fund ( FDVLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on the Mid Cap Value 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 FDVLX 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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