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4 Funds to Celebrate Upbeat Consumer Confidence in December

Consumer confidence jumps in December as Americans feel confident about the US economy despite serious headwinds.

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This story originally appeared on Zacks

Americans are quite confident about the U.S. economy despite headwinds from the fast-spreading Omicron variant of COVID-19 and inflation. Consumers are willing to spend confidently because of a strong labor market, with employers raising wages to fill up the vacancies. In fact, The Conference Board’s Senior Director of Economic Indicators, Lynn Franco, believes that the economy’s current momentum is likely to continue in early 2022 despite serious headwinds.

- Zacks

Given such positives, investors can pick mutual funds like Fidelity Select Retailing Portfolio FSRPX, Fidelity Select Leisure Portfolio FDLSX, Fidelity Real Estate Investment Portfolio FRESX and Fidelity Select Automotive Portfolio FSAVX.

On Dec 22, the Conference Board reported that its consumer confidence index moved up to 115.8, much above the consensus estimate of 111. In fact, November’s figure was also upwardly revised to 111.9 from 109.5. Diving into the sub-indexes, in accordance with the present situation, 19.9% of consumers said business conditions were “good,” and 55.1% of consumers said that jobs were “plentiful.” However, the gauge that measures short-term expectation jumped to 96.9 from 90.2 in November.

Franco states that looking at the short-term expectation that measures outlook for income, business, and labor market conditions in the next six months, there has been a significant increase in the “proportion of consumers planning to purchase homes, automobiles, major appliances, and vacations over the next six months.” Additionally, 25.1% of the surveyed consumers expect more jobs to be available in the months ahead.

The report shows that Americans are ready to spend generously this holiday season, especially on big-ticket items like electronics, automobiles, housing, and even vacations. Americans are showing resilience to higher inflation and the continued spread of Delta and Omicron variants of COVID-19.

4 Funds to Pick Now

Given the current scenario, we have shortlisted four mutual funds from retail, automobile, leisure and real estate sectors poised to grow. The funds carry a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) and are poised to grow. In addition, the minimum initial investment for these funds is within $5,000.

We expect these funds to outperform peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify the potential winners and losers. Unlike most fund-rating systems, the Zacks Mutual Fund Rank is not just focused on the fund’s past performance but also its likely future success.

The question here is why should investors consider mutual funds? Reduced transaction costs and portfolio diversification without several commission charges associated with stock purchases are primarily the reasons for parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages and How They Make Investors Money).

Fidelity Select Leisure Portfolio fund aims for capital appreciation. The fund invests at least 80% of its assets in companies that design, produce or distribute goods or services in the leisure industries. FDLSX is a non-diversified fund invests in both domestic and foreign stocks.

This Zacks Sector-Other product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.

Fidelity Select Leisure Portfolio has a Zacks Mutual Fund Rank #1 and has three and five-year returns of 15.8% and 15.1%, respectively.

Fidelity Select Retailing Portfolio fund aims for capital appreciation. This non-diversified fund invests the majority of its assets in securities of companies that merchandise finished goods and services to individual customers. FSRPX invests in both U.S. and non-U.S. stocks.

This Zacks Sector-Other product has a history of positive total returns for more than 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.

Fidelity Select Retailing Portfolio has a Zacks Mutual Fund Rank #1 and has returned nearly 26% and 23.3% in the past three and five years, respectively.

TheFidelity Real Estate Investment Portfolio fund aims for above-average income and long-term capital growth, consistent with reasonable investment risk. This non-diversified fund invests primarily in common stocks. The majority of FRESX’s assets are invested in securities of companies principally engaged in the real estate industry and other real estate-related investments.

This Zacks sector – Real Estate product has a history of positive total returns for more than 10 years. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.

Fidelity Real Estate Investment Portfolio has a Zacks Mutual Fund Rank #1 and has returned 10.9% and 9.3% over the past three and five years, respectively.

Fidelity Select Automotive Portfolio fund aims for capital appreciation. This fund invests most assets in common stocks of companies engaged in manufacturing automobiles, trucks, specialty vehicles, parts, tires, and related services.

This Sector - Other product has a history of positive total returns for over 10 years. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.

Fidelity Select Automotive Portfolio has a Zacks Mutual Fund Rank #2 and has returned 35.1% and 24.4% over the past three and five years, respectively.

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