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Lowell: Fidelity Favorites

03/07/2003 12:00 am EST


Jim Lowell

Senior Partner & Chief Investment Strategist, Adviser Investments

Jim Lowell is perhaps the nation's leading expert on Fidelity funds. As editor of Fidelity Investor and the more aggressive Fidelity Sector Trader, Jim has perhaps the most in-depth knowledge of any financial advisor regarding the history of Fidelity funds, the specific fund choices, the long-term records of their fund managers, and an uncanny knack for knowing when to shift in and out of various sectors. Here, he discusses his current favorite fund selections.

"My selection of Fidelity Low-Priced Stock (FLPSX) should virtually be in everyone's portfolio. Joel Tillinghast is probably the most gifted stock picker of this generation. And he still has 20 more years in his career to go. There are 850 stocks in his portfolio. In the last recession in 1989-91, he proved himself, by not just recovering double-digit gains against his benchmark but also against the S&P 500. I think he is set to do it again. The fund has closed three times in its history, but it recently reopened.

"I also like a unique fund at Fidelity called Leveraged Company Stock (FLVCX), managed by David Glancy, who also manages Capital and Income, a junk bond fund. Leverage Company Stock Fund invests in distressed stocks. He is buying the debt. He has had ten years' experience buying debt and stocks of distressed companies, and Lord knows there are now plenty of distressed companies to pick from. So far this year, the fund is down about 2%, which is a little better than the market, but going forward I think we'll see some pretty good gains come from Glancy.

"Finally, for the first times in three years, we're moving overseas. Again, this fund is unique to Fidelity, called International Small Cap (FISMX ) managed by Elcy Kavall. The fund concentrates in the least-efficient market in the established markets of Europe and in the small-cap sector, focused on management. Fidelity has 80 analysts in the UK alone. Nobody kicks tires better than Fidelity, and I think there are some strong gains to be had here. The fund is up 1.8% since we bought it at the start of the year."

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