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Is Fidelity Advisor Small Cap Growth A (FCAGX) a Strong Mutual Fund Pick Right Now?

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Looking for a Small Cap Growth fund? You may want to consider Fidelity Advisor Small Cap Growth A (FCAGX) as a possible option. FCAGX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

The world of Small Cap Growth funds is an area filled with options, such as FCAGX. These funds tend to create their portfolios around stocks that sport large growth opportunities and market capitalization of less than $2 billion. The companies in these portfolios are usually on the smaller side, and are in up-and-coming industries and markets.

History of Fund/Manager

Fidelity is based in Boston, MA, and is the manager of FCAGX. Since Fidelity Advisor Small Cap Growth A made its debut in November of 2004, FCAGX has garnered more than $283.13 million in assets. The fund's current manager is a team of investment professionals.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 11.24%, and is 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 13.65%, 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 9.77%, the standard deviation of FCAGX over the past three years is 14.24%. Over the past 5 years, the standard deviation of the fund is 14.04% compared to the category average of 9.86%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In FCAGX's case, the fund lost 55.3% in the most recent bear market and underperformed comparable funds by 2.27%. This might suggest that the fund is a worse choice than its peers during a bear market.

Even still, the fund has a 5-year beta of 1.03, so investors should note that it is hypothetically as volatile as the market at large. 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. The fund has produced a positive alpha over the past 5 years of 0.32, which shows that 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, FCAGX is a load fund. It has an expense ratio of 1.30% compared to the category average of 1.29%. Looking at the fund from a cost perspective, FCAGX is actually more expensive than its peers.

Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.

Bottom Line

Overall, Fidelity Advisor Small Cap Growth A ( FCAGX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a somewhat average choice for investors right now.

This could just be the start of your research on FCAGXin the Small Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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