Is Fidelity International Real Estate (FIREX) a strong mutual fund right now?

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ABOUTn looking for a sector – a real estate fund? One option is to start with Fidelity International Real Estate (FIREX). FIREX is rated 1 by the Zacks Mutual Fund (Strong Buy), which is based on nine predictive factors such as size, value, and past performance.

purpose

We classify FIREX in the “Sector – Real Estate” category, where there are many possible options. Sector – Real estate mutual funds usually invest in various real estate investment funds (REITs). REITs are a popular income generating tool due to taxation rules that require REITs to pay at least 90% of their income each year to avoid double taxation. This method makes the securities here payers of high dividends and in some cases almost like bonds; however, they still carry equity risk.

Fund / manager history

FIREX is part of the Fidelity family of funds, a company based in Boston, Massachusetts. Fidelity International Real Estate debuted in December 2004. Since then, FIREX has amassed approximately $ 339.10 million in assets, according to the latest information available. Guillermo de las Casas is the current fund manager and has held this position since April 2010.

Representation

Of course, investors expect strong results from funds. FIREX has a 5-year annual total return of 10.74% and is ranked third among peers in its category. Investors who prefer to analyze a shorter time frame should look at its 3-year annualized total return of 10.68%, which places it in the top third over that time frame.

It is also important to consider the standard deviation of the return when evaluating the performance of a fund. The lower the standard deviation, the lower the volatility of the fund. Compared to the category average of 15.55%, the FIREX standard deviation over the past three years is 15.02%. The fund’s standard deviation over the past 5 years is 12.77% compared to the category average of 12.9%. This makes the fund less volatile than its counterparts over the past half decade.

Risk factors

At a 5-year beta of 0.66, the fund is likely to be less volatile than the market average. Since alpha represents the performance of a risk-adjusted portfolio compared to the benchmark, which in this case is the S&P 500, you should also look at this metric. The 5-year FIREX results gave a negative alpha of -0.63, which means that it is difficult for managers in this portfolio to select securities that generate higher than benchmark returns.

Expenses

As competition grows in the mutual fund market, costs become more and more important. Compared to its identical counterpart, an inexpensive product will be better than all other things being equal. Thus, it is vital for investors to take a close look at the cost metrics. In terms of commissions, FIREX is not a load fund. The expense ratio is 0.98% compared to the category average of 1.22%. Thus, FIREX is actually cheaper than its counterparts in terms of costs.

Investors should be aware that with this product, the minimum initial investment is $ 0; each subsequent investment does not have a minimum amount.

Bottom line

Overall, Fidelity International Real Estate (FIREX) has a high Zacks Mutual Fund rating, and coupled with its comparatively high performance, moderate exposure and lower fees, Fidelity International Real Estate (FIREX) looks like a good potential choice for investors. now.

Want even more information about FIREX? Then head over to Zacks.com and check out our mutual fund comparison tool and all the other great features we can help you with analyzing mutual funds for more information. If you’d like to view our inventory reports as well, be sure to head over to Zacks.com to see all the great tools we have to offer, including our time-tested Zacks ranking.

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The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.

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