If you’ve been stuck searching for Index funds, consider Fidelity Mid Cap Enhance Index Fund (FMEIX) as a possibility. While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
FMEIX is a part of the Fidelity family of funds, a company based out of Boston, MA. Fidelity Mid Cap Enhance Index Fund debuted in January of 2008. Since then, FMEIX has accumulated assets of about $1.96 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Investors naturally seek funds with strong performance. FMEIX has a 5-year annualized total return of 14.85% and it sits in the middle 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 14.99%, which places it in the top 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. The standard deviation of FMEIX over the past three years is 22.13% compared to the category average of 16.72%. The fund’s standard deviation over the past 5 years is 17.83% compared to the category average of 13.97%. This makes the fund more volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 1.13, which means it is hypothetically 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. FMEIX has generated a negative alpha over the past five years of -4.05, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, FMEIX is a no load fund. It has an expense ratio of 0.59% compared to the category average of 0.79%. FMEIX 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.
For additional information on the Index area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FMEIX too for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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