Fidelity Investments is the country’s fourth-largest mutual funds manager with more than $3 trillion in assets under management, as of Sept. 30, 2019, the most recently available information. Fidelity serves 30 million individual investors. Here's a look at three of its funds that are rated 5 stars by fund tracker Morningstar. All information is accurate as of Dec. 31, 2019.
- Fidelity Funds is one of the biggest fund families in the world, with more than $7.8 trillion in total customer assets and over $3 trillion in assets under management.
- Fidelity has 504 mutual funds as of 2019, and 31 of them are rated 5 stars by fund tracker Morningstar.
- Among the highlights are two funds in the balanced category, Fidelity Balanced and Fidelity Capital & Income.
- Another 5-star fund for investors to consider is the Fidelity Mid Cap Enhanced Index, which tracks the Russell Mid Cap index.
Balanced Funds invest in a mix of stocks, bonds and cash, which is why they are called "balanced" funds. Balanced funds are a good option for investors who either want to have a smaller number of funds, and therefore like the somewhat "all in one" approach a balanced fund offers, or who want a fund that can represent a base upon which they can build the rest of their portfolio.
Fidelity Balanced falls in the middle in terms of riskiness. It is riskier than a pure bond fund, but not as risky as a pure stock fund. It is considered to be a moderate allocation fund, meaning it offers a medium-risk asset allocation that is roughly two-thirds stocks and one-third bonds.
Since the fund's inception in 1986, it has seen an average return of roughly 9%, similar to what a stock fund might see. The expense ratio for FBALX is 0.53% and the minimum initial purchase is $0.00. The 2019 return was 21.45%. The 3-year annualized return is 11.21% and the 5-year return is 7.79%.
Fidelity Capital & Income
The Fidelity Capital & Income Fund (FAGIX) is another balanced fund that is swayed more toward bonds, with roughly 20% of the portfolio geared toward stocks and 80% toward bond asset allocation. The fund provides a good mix of growth and income. The market risk is higher than that of a pure bond fund but lower than that of a pure stock fund. Long-term returns are higher than most bond funds.
The expense ratio for FAGIX is 0.69% and the minimum initial purchase is $0.00. The 2019 return was 16.03%. The 3- and 5- year annualized returns are 7.46% and 5.83%.
The total amount in customer accounts held by Fidelity, as of 2019.
Fidelity Mid Cap Enhanced Index
Another 5-star Fidelity fund highlighted by Morningstar, the Fidelity Mid Cap Enhanced Index (FMEIX) is a good choice for investors who want exposure to mid-cap stocks. FMEIX tracks the Russell Mid Cap index, giving investors exposure to around 300 middle capitalization stocks. Mid-cap stocks have the potential for greater growth than their large-cap brethren but also are vulnerable to bigger short-term declines. FMEIX is more of an aggressive option than the two balanced funds highlighted.
The expense ratio for FMEIX is 0.59% and the minimum initial purchase is $0.00. The 2019 return was 24.78%. The 3- and 5- year annualized returns are 9.80% and 7.69%.