Is FSRRX a Strong Bond Fund Right Now?
MF Bond Report for FSRRX
If you have been looking for Investment Grade Bond - Intermediate funds, it would not be wise to start your search with Fidelity Strategic Real Return (FSRRX). FSRRX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
We note that FSRRX is an Investment Grade Bond - Intermediate option, which is a segment loaded with many different investment options. By targeting bonds that mature in more than three years but less than 15 years, Investment Grade Bond - Intermediate funds are a middle of the curve option. Fixed income instruments at this maturity level usually have medium duration risk, but their yields are respectable, especially in comparison to their short-maturity counterparts. Additionally, a focus on investment grade makes these funds safer, but yields tend to be lower than in the junk bond category.
History of Fund/Manager
FSRRX is a part of the Fidelity family of funds, a company based out of Boston, MA. The Fidelity Strategic Real Return made its debut in September of 2005 and FSRRX has managed to accumulate roughly $233.14 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 5.27%, and is in the top 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 6.86%, 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. Compared to the category average of 13.36%, the standard deviation of FSRRX over the past three years is 9.67%. Looking at the past 5 years, the fund's standard deviation is 7.65% compared to the category average of 11.02%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.3, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, FSRRX has a positive alpha of 3.55, which measures performance on a risk-adjusted basis.
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, FSRRX is a no load fund. It has an expense ratio of 0.75% compared to the category average of 0.79%. From a cost perspective, FSRRX is actually cheaper than its peers.
While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.
Overall, Fidelity Strategic Real Return ( FSRRX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Want even more information about FSRRX? 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. 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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