Is Fidelity Trend Fund (FTRNX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Global - Equity funds, consider Fidelity Trend Fund (FTRNX) as a possibility. FTRNX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FTRNX is a Global - Equity option, an investment area loaded with different options. While Global - Equity mutual funds invest their assets in large markets--think the U.S., Europe, and Japan--they aren't limited by geography. Their investment technique is one that leverages the global economy in order to offer stable returns.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FTRNX. Fidelity Trend Fund debuted in December of 1961. Since then, FTRNX has accumulated assets of about $3.28 billion, according to the most recently available information. The fund is currently managed by Shilpa Mehra who has been in charge of the fund since August of 2018.
Performance
Investors naturally seek funds with strong performance. FTRNX has a 5-year annualized total return of 21.62% 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 22.99%, 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. FTRNX's standard deviation over the past three years is 19.65% compared to the category average of 19.83%. Looking at the past 5 years, the fund's standard deviation is 16.17% compared to the category average of 16.39%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.01, the fund is likely to be as volatile as the market average. 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 4.74. This means that 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, FTRNX is a no load fund. It has an expense ratio of 0.73% compared to the category average of 1.14%. Looking at the fund from a cost perspective, FTRNX is actually cheaper 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 Trend Fund ( FTRNX ) 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.
Want even more information about FTRNX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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