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Is Fidelity Select Retailing (FSRPX) a Strong Mutual Fund Pick Right Now?

Zacks Equity Research
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Having trouble finding a Sector - Other fund? Fidelity Select Retailing (FSRPX) is a possible starting point. FSRPX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

FSRPX is a part of the Fidelity family of funds, a company based out of Boston, MA. Since Fidelity Select Retailing made its debut in December of 1985, FSRPX has garnered more than $2.77 billion in assets. The fund is currently managed by Nicola Stafford who has been in charge of the fund since October of 2016.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. FSRPX has a 5-year annualized total return of 12.78% 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 11.21%, 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 13.78%, the standard deviation of FSRPX over the past three years is 14.13%. Over the past 5 years, the standard deviation of the fund is 14.15% compared to the category average of 14.04%. 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. In FSRPX's case, the fund lost 40.11% in the most recent bear market and outperformed its peer group by 8.3%. This could mean that the fund is a better choice than comparable funds during a bear market.

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. FSRPX has a 5-year beta of 1.1, 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. With a positive alpha of 3.59, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Expenses

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, FSRPX is a no load fund. It has an expense ratio of 0.75% compared to the category average of 1.15%. Looking at the fund from a cost perspective, FSRPX is actually cheaper than its peers.

While the minimum initial investment for the product is $2,500, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Select Retailing ( FSRPX ) has a neutral Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.

Your research on the Sector - Other segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.


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