On August 1, Fidelity took direct aim at index fund competitors Vanguard, Blackrock’s iShares ...
Four “Unique” Funds from Fidelity
08/20/2014 9:00 am EST
In his latest Fidelity Investor, fund expert Jim Lowell looks at a number of buy-rated funds that would qualify as having unique characteristics.
Event Driven Opportunities (FARNX)
Manager Arvind Navaratnam invests in companies involved in a special situation such as reorganizations, changes in ownership, deletion from market index, material changes in structure or strategy, or changes in capital structure. It began trading in December 2013 and has a market value of $70 million.
Foreign investments make up 11% of the holdings. The top three sectors are industrials (23%), consumer discretionary (22%), and information technology (22%).
His top ten holdings are Civeo, Tessera Technologies, Sotheby’s, Progressive Waste Solution, Chicos Fas, Comverse, Valmet, PRGX Global, Quantum, and Destination XL Group.
The fact that this fund is framed by its name, and the fact that it is forced to be focused, makes its approach unique. Manager Stephen DuFour invests in 50-60 stocks that Fidelity believes show high potential for growth.
The current number of holdings is 52. It began trading in September 1993 and has a market value of close to $800 million. The top three sectors are information technology (24.2%), energy (19%), and industrials 16%).
The top ten holdings are Adobe, Ameriprise Financial, McGraw Hill Financial, Cummins, American Airlines, Google, Cabot Oil and Gas, Halliburton, Range Resources, and Noble Energy.
Leveraged Company Stock (FLVCX)
This fund was created by the former manager of Capital & Income, David Glancy. David’s right hand man back then was Tom Soviero, and Tom has proven to be a solid student of this equity-related side of the junk bond marketplace.
Leveraged companies are companies that issue lower-quality debt and companies with leveraged capital structures. Foreign investments make up 14% of the holdings. The top three sectors are consumer discretionary (24%), materials (14%), and industrials (12%).
The top ten holdings are Lyondellbasell Industries, Service Corporation Int’l, Comcast, GM, Ford Motor, Delta Air, Bank of America, Boston Scientific, Rock Tennessee Company, and AES Corporation.
Low-Priced Stock (FLPSX)
Arguably the largest, best managed and most well-known unique fund in the fund business, lead manager Joel Tillinghast invests in low-priced stocks, which are currently defined as stocks priced $35 or less at time of purchase.
He can own stocks all the way to the stratosphere, but the unique low-priced litmus test means he’s rarely caught buying high. Joel created and launched this fund back in 1989; it has a market value of almost $32 billion.
Foreign investments make up 34.5% of the holdings. The top three sectors are consumer discretionary (24%), information technology (19%), and financials (11%).
The top ten holdings are United Health Group, Next PLC, Seagate Technology, Microsoft, Best Buy, Metro, Ross Stores, UNUM, and Oracle.
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