Is Fidelity Select Brokerage and Investment Management (FSLBX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Sector – Finance funds, a place to start could be Fidelity Select Brokerage and Investment Management (FSLBX). FSLBX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

FSLBX is part of the Sector – Finance section, which boasts an array of other possible selections. Sector – Finance funds offer a stable, diversified approach to investing that focuses on the financial industry, an infamously large, complex, and heavily-regulated space. Funds here can include insurance companies and exchanges, as well as banks and investment giants. Investors should note that interest rates may also impact players in this market.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FSLBX. The Fidelity Select Brokerage and Investment Management made its debut in July of 1985 and FSLBX has managed to accumulate roughly $618.10 million in assets, as of the most recently available information. The fund is currently managed by Charlie Ackerman who has been in charge of the fund since November of 2018.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 21.55%, and it sits in the top 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 20.98%, 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. FSLBX’s standard deviation over the past three years is 21.61% compared to the category average of 27.22%. The fund’s standard deviation over the past 5 years is 18.53% compared to the category average of 22.37%. This makes the fund less 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. FSLBX has a 5-year beta of 1.06, 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. FSLBX’s 5-year performance has produced a positive alpha of 3.08, which means 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, FSLBX is a no load fund. It has an expense ratio of 0.76% compared to the category average of 1.53%. Looking at the fund from a cost perspective, FSLBX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.

Bottom Line

Overall, Fidelity Select Brokerage and Investment Management ( FSLBX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Select Brokerage and Investment Management ( FSLBX ) looks like a good potential choice for investors right now.

Want even more information about FSLBX? 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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