The specific sectors that you are invested in can have a significant impact on the overall return of your portfolio.
In the last five years, the performance differential between the best and the worst sector funds has averaged 71% and ranged from 49% to 117%. Each year the leaders and the laggards tend to be different and they can even change throughout the year due to the rotation of sectors.
Go to our momentum screen for the complete rankings of all 42 Fidelity sector funds. We also provide our assessment of their long-term trends based on a technical analysis perspective:
Our fund rating system can help you find new trends and can warn about declining investments.
Invest in Bullish Trends
EXAMPLE: The Fidelity Select Automotive Fund (FSAVX) was last upgraded to BUY rating on 2017-09-12 and gained 6.78% since then, assuming reinvested dividends and distributions. In comparison, the benchmark Fidelity 500 Index Fund (FUSEX) returned 2.67% in the same period.
Avoid Weak Sectors
EXAMPLE: The Fidelity Select Consumer Staples Fund (FDFAX) was downgraded to SELL rating on 2017-06-16. The fund returned -4.56% since the downgrade, while the benchmark index fund returned 5% in the same period.
First, we perform trend analysis combined with relative strength ranking to select investments that are not only in a bullish long-term uptrend, but also have the strongest momentum relative to the benchmark S&P500 index and other sector funds.
Click here to see market-leading Bullish investments.
Using the momentum screen we narrowed our selection to outperforming sectors that are also long-term bullish.
Next, we apply our proprietary pattern recognition technology to identify seasonal (short-term) trends, and rate the sector funds BUY, SELL or HOLD, accordingly.
This is an important step since we would like to avoid rotating into investments that are not advancing.
Click here to see funds, which are Rated BUY.
At this point, we have a small set of sector funds that are not only trending higher both in the long and the short-term timeframe but also outperform the market.
Our daily report identifies purchase and sell opportunities for these top-performing sector funds.
The report also highlights potentially upcoming trades, in addition to recent upgrades and downgrades.
Click here to check if any investment is identified today as New Purchase.
Fidelity Sector Report is an independent online investment newsletter that is not affiliated with Fidelity Investments.
Fidelity Sector Report is produced by Axiomix, Inc. (www.axiomix.com), a technical research firm.
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© 2017 Axiomix, Inc. SectorTRACK is a trademark of Axiomix, Inc. All Rights Reserved.
Axiomix, Inc. is not a registered investment adviser. The material provided on this website is for general informational purposes only and is not intended as investment advice. Past performance does not guarantee future results.