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Is Fidelity Advisor Semiconductors I (FELIX) a Strong Mutual Fund Pick Right Now?

Zacks Equity Research

Having trouble finding a Sector - Tech fund? Well, Fidelity Advisor Semiconductors I (FELIX) would not be a good potential starting point right now. FELIX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We note that FELIX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.

History of Fund/Manager

FELIX is a part of the Fidelity family of funds, a company based out of Boston, MA. The Fidelity Advisor Semiconductors I made its debut in December of 2000 and FELIX has managed to accumulate roughly $98.57 million in assets, as of the most recently available information. Stephen Barwikowski is the fund's current manager and has held that role since January of 2009.

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 20.08%, 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 22.94%, 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. Compared to the category average of 11.19%, the standard deviation of FELIX over the past three years is 22.73%. The fund's standard deviation over the past 5 years is 21.31% compared to the category average of 11.28%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. FELIX lost 57.08% in the most recent bear market and underperformed its peer group by 4%. This means that the fund could possibly be a worse choice than its peers during a down market environment.

Even still, the fund has a 5-year beta of 1.42, 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. FELIX's 5-year performance has produced a positive alpha of 4.88, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, FELIX is a no load fund. It has an expense ratio of 0.84% compared to the category average of 1.30%. Looking at the fund from a cost perspective, FELIX 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 Advisor Semiconductors I ( FELIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Fidelity Advisor Semiconductors I ( FELIX ) looks like a somewhat weak choice for investors right now.

For additional information on the Sector - Tech 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 FELIX too for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.


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