Is Fidelity Latin American Fund (FLATX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Mutual Fund Equity Report fund category, Fidelity Latin American Fund (FLATX) could be a potential option. FLATX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
FLATX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Latin American Fund debuted in April of 1993. Since then, FLATX has accumulated assets of about $262.45 million, according to the most recently available information. The fund is currently managed by William Pruett who has been in charge of the fund since October of 2015.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of -1.37%, and it sits in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of -7.57%, which places it in the bottom third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, FLATX's standard deviation comes in at 36.57%, compared to the category average of 19.46%. Over the past 5 years, the standard deviation of the fund is 31.99% compared to the category average of 17.3%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.07, so it is likely going to be more volatile than the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. FLATX's 5-year performance has produced a negative alpha of -7.92, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FLATX is a no load fund. It has an expense ratio of 1.05% compared to the category average of 1.15%. FLATX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Fidelity Latin American Fund ( FLATX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, Fidelity Latin American Fund ( FLATX ) looks like a great potential choice for investors right now.
Want even more information about FLATX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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