On the lookout for a Sector – Utilities fund? Starting with Fidelity Telecom/Utilities Fund (FIUIX) is one possibility. FIUIX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FIUIX in Sector – Utilities, which is a segment packed with options. Known for its stability, the utility industry is perfect for investors seeking low risk. Sector – Utilities mutual funds focus on companies that provide essential services to millions of people on a daily basis: think electric power, gas distribution, and water supply.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FIUIX. Fidelity Telecom/Utilities Fund debuted in November of 1987. Since then, FIUIX has accumulated assets of about $1.27 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 9.93%, and is in the middle 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 15.52%, which places it in the top third during this time-frame.
It is important to note that the product’s returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund’s [%] sale charge. If sales charges were included, total returns would have been lower.
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. FIUIX’s standard deviation over the past three years is 14.1% compared to the category average of 14.41%. The standard deviation of the fund over the past 5 years is 15.1% compared to the category average of 15.66%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.56, the fund is likely to be less volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio’s performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. FIUIX’s 5-year performance has produced a positive alpha of 1.29, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.