If investors are looking at the Allocation Balanced fund category, Fidelity Asset Manager 70% (FASGX) could be a potential option. FASGX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
FASGX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FASGX. Fidelity Asset Manager 70% debuted in December of 1991. Since then, FASGX has accumulated assets of about $4.87 billion, according to the most recently available information. The fund's current manager, Geoffrey D. Stein, has been in charge of the fund since June of 2009.
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 5.62%, and is in the top 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 7.84%, 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. The standard deviation of FASGX over the past three years is 8.95% compared to the category average of 7.36%. Looking at the past 5 years, the fund's standard deviation is 8.95% compared to the category average of 7.65%. This makes the fund more volatile than its peers over the past half-decade.
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, FASGX lost 44.2% and underperformed comparable funds by 8%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Nevertheless, with a 5-year beta of 0.72, 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. With a negative alpha of -1.83, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, FASGX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 0.89%. From a cost perspective, FASGX 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.
Overall, Fidelity Asset Manager 70% ( FASGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Asset Manager 70% ( FASGX ) looks like a good potential choice for investors right now.
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