The Fidelity Growth Company Fund has had an outstanding decade. Independent mutual fund rating company Morningstar, which gives it a five-star rating, says it is one of the best-performing funds of the past 10 years. The fund has $45.4 billion in assets under management and invests in domestic and foreign companies that the advisor believes have above-average growth potential. Ranked in the first percentile by Morningstar, Fidelity Growth had a 10-year annualized total return of 18.10%, well above the 13.6% average for the “large growth” category. During that period, Fidelity Growth Company posted its highest annual return of 67.7% in 2020. As of Wednesday, the fund is down almost 21% in 2022. “While disappointing, this underperformance is largely in line with what investors should expect from the strategy given its style, typical exposure to high-volatility companies and an unfavorable macro backdrop,” Morningstar strategist Robby Greengold wrote in May. Growth stocks had a difficult first half. But the stock market has recovered from its June lows, buoyed by investors keeping an eye on inflation data and the Federal Reserve. Fidelity Growth Company fund manager Steve Wymer is “one of the best” and his strategy has consistently kept the fund ahead of its peers, Greengold said. This performance earned a Gold analyst rating from Morningstar. Fidelity fund’s top position is Apple, which accounted for 11% of the portfolio at the end of June, followed by Nvidia, Microsoft, Amazon and Alphabet. Apple, which has been in the fund since 2004, is down slightly for the year but is up around 35% since its June 16 bottom. Nvidia, which makes up 6.92% of the portfolio, is down more than 36% for the year, and Microsoft, which makes up 6.42% of the fund, is down nearly 14% so far this year. The two most recent additions to the fund are Growthco AB Holdings LLC with 0.32% of the portfolio and Sysco with 0.22%, according to Morningstar. The Fund has increased its position in several stocks as of June 30th. The holdings with the biggest stock gains still made up a small portion of the portfolio. The biggest rise came in shares of UnitedHealth, with the fund increasing the number of shares it holds by 83%. The health insurer now accounts for 0.53% of the fund’s portfolio. The number of Accenture shares rose 58% and the Procter & Gamble position grew 44%, with each position accounting for less than 0.25% of the portfolio. Meanwhile, the fund’s holdings in EOG Resources rose 28.1% and the number of TJX shares rose 8.9%, Morningstar noted. Of the top 10 positions held by the fund, only Visa shares rose modestly by 0.22% over the most recent quarter. The credit card company accounts for 1.13% of the portfolio. Fidelity Growth Company’s fee level is above average, with an expense ratio of 0.73%, according to Morningstar.
