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Jim Lowell, editor of Jim Lowell’s Fidelity Investor, says two well-run Fidelity funds offer good exposure to a recovery and protection against a double-dip.

In my most optimistic moments, I think companies’ [ability] to profit at current consumer/consumption levels continues to bode well for a spring-loaded bounce once fundamentals displace fear. Absent any new major positive or negative catalyst, I continue to peg the date as November 3rd for good speed or furling all sails.

At stake is the question the markets have been wrestling for months: the pace of the recovery vs. questioning the recovery itself. While that has been prologue for the markets over the past quarter or two, the fundamentals at home and abroad continue to support slow recovery, not no recovery. Unless and until I see differently, I’ll continue to chart our balanced course for imbalanced times.

While I continue to find it hard to argue for, let alone side with, those who see nothing but deflation and depression as the probable outcome of the road we’re on, I see the risk of a double dip as having incrementally increased [to a one-in-four chance,] based on the slowing pace of recovery.

After a robust year of rebounding gains, I forewarned that this year would be a harder slog. It has been. [But] the recovery, uneven and sporadic as it is, is still the most probable path that we’re on.

Down that path, I’ll continue to hew towards our balanced approach to imbalanced times. I may never waver from such an approach unless I see sustainable evidence for resurgent growth. Here and now, it doesn’t make sense to discount the negatives any more than it does to amplify the positives. It does make sense to stick with our current managers and diversified, global allocation they encompass.

Put it another way: Capital preservation remains as significant a contributor to my investment strategy as does capital appreciation.

Domestically, Joel Tillinghast at Fidelity Low-Priced Stock (FLPSX) is earning his recession-to-recovery keep, while [Will] Danoff at Fidelity Contrafund (FCNTX) [is] upgrading the quality and liquidity of my desired overall top-tier and/or blue-chip bent.

Danoff invests in companies whose value is not fully recognized by the market and/or investors. Foreign investments make up 19.2% of the holdings. [Contrafund’s] top three sectors are information technology (30.5%), consumer discretionary (18%), and health care (10.8%). The top ten holdings include Apple (Nasdaq: AAPL), Google (Nasdaq: GOOG), Berkshire Hathaway (NYSE: BRK-B), Wells Fargo (NYSE: WFC), [and] McDonald’s (NYSE: MCD).

Low-Priced Stock’s manager Joel Tillinghast invests in stocks of companies priced at $35 or below. Foreign investments make up 32.5% of holdings. The top three sectors are consumer discretionary (23.9%), information technology (14.6%), and health care (13%). The top ten holdings [include] UnitedHealth Group (NYSE: UNH), Safeway (NYSE: SWY), Oracle (Nasdaq: ORCL), Ross Stores (Nasdaq: ROST), and Gildan Activewear (NYSE: GIL).

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