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Is Fidelity Growth Discovery (FDSVX) a Strong Mutual Fund Pick Right Now?

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Mutual Fund Equity Report fund seekers should consider taking a look at Fidelity Growth Discovery (FDSVX - Free Report) . FDSVX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

FDSVX finds itself in the Fidelity family, based out of Boston, MA. Fidelity Growth Discovery debuted in March of 1998. Since then, FDSVX has accumulated assets of about $2.50 billion, according to the most recently available information. The fund is currently managed by Jason Weiner who has been in charge of the fund since February of 2007.

Performance

Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 15.02%, 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 16.19%, 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 FDSVX over the past three years is 20.85% compared to the category average of 19.04%. The standard deviation of the fund over the past 5 years is 18.81% compared to the category average of 17%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.02, so investors should note that it is hypothetically as volatile as the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. Over the past 5 years, the fund has a positive alpha of 2.87. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Holdings

Investigating the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is primarily on equities that are traded in the United States.

The mutual fund currently has 98.74% of its holdings in stocks, and these companies have an average market capitalization of $472.34 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Finance
Turnover is about 45%, so those in charge of the fund make fewer trades than comparable funds.

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, FDSVX is a no load fund. It has an expense ratio of 0.77% compared to the category average of 0.99%. FDSVX is actually cheaper than its peers when you consider factors like cost.

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 Growth Discovery ( FDSVX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

Don't stop here for your research on Mutual Fund Equity Report funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FDSVX to its peers as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


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