The Fidelity Magellan Fund ("FMAGX") was once the largest and most well-known mutual fund in the industry. Launched on May 2, 1963, the fund is known for its performance during former manager Peter Lynch's tenure from May 1, 1977, to May 31, 1990, during which it returned an average of over 29% per year, topping the Standard & Poor's (S&P) 500 Index's performance of 15% per year. Assets under management (AUM) peaked at around $110 billion in 2000. The fund's subsequent underperformance, combined with macro events like the bursting of the tech bubble, led much of its investment dollars heading for the exit. As of June 4, 2018, the fund manages a total of $17.5 billion.
Fidelity Investments was founded in 1946 by Edward Johnson II. The company runs a large family of mutual funds, provides investment advice, offers brokerage and retirement plan services, and acts as a securities clearinghouse. As of March 31, 2018, it manages $6,854.5 billion in customer assets.
Fund Management Team
Jeff Feingold is the fund's manager. He's been managing the fund since Sept. 13, 2011, when he took over for Harry Lange. Feingold joined Fidelity in 1997 as an equity research analyst and has prior experience managing over a dozen other Fidelity mutual funds.
The fund seeks to deliver long-term capital growth by investing primarily in large-cap and mega-cap stocks. While the fund falls in Morningstar's large growth category, with its fund managers looking to companies with market caps greater than $10 billion, Fidelity fund managers look to invest in both growth and value stocks to identify outperformers.
The fund was closed to new investors from Sept. 30, 1997 to Jan. 14, 2008, as assets under management (AUM) more than doubled from 1997 to 2000. The fund is currently open to new investors and requires a $2,500 minimum initial investment to open an account. It has a total expense ratio of 0.69%, as of May 30, 2018.
While the fund sticks to large caps, it can invest in stocks from any sector and can invest overseas. Its manager favors companies with above-average revenue or earnings growth. However, in keeping with Fidelity's general desire to identify opportunities in both growth and value stocks, the fund's manager also looks for companies that are undervalued relative to forecasted sales and earnings growths, or companies that are already delivering rapid growth and are expected to continue doing so.
As of May 30, 2018, the fund has 129 holdings in its portfolio, with the top 10 accounting for 27.12% of its total assets. Top holdings include Microsoft (NASDAQ: MSFT), Apple Inc. (NASDAQ: AAPL), and Amazon (NYSE: AMZN). As of July 31, 2018, the fund's top three sector weightings are in information technology at 30.99% of total assets, financials at 16.06% and healthcare at 14.03% of total assets. IT and financials have a greater weighting in the fund's portfolio than they do in the S&P 500. Around 3% of the fund's total assets reside outside the United States.