The Fidelity Strategic Dividend & Income Fund is a diversified investment vehicle managed by Fidelity Investments, aiming to generate high current income and long-term capital growth. The fund follows a balanced approach focused on risk management and dividend-paying stocks, demonstrating a solid 52-week average return of 12.39%. With a low net expense ratio and a current yield of 2.68%, the fund provides investors with a reliable income stream and the potential for capital appreciation. By exploring the fund’s detailed portfolio composition, risk measures, and distribution strategy, investors can better understand its unique positioning within the market.
Fund Objectives and Strategy
The Fidelity Strategic Dividend & Income Fund (FSDIX) primarily aims to generate a high level of current income and capital growth by investing in a diversified portfolio of dividend-paying stocks and fixed-income securities. Managed by the experienced team at Fidelity Investments, FSDIX endeavors to maintain a well-diversified mix across various sectors and industries to effectively manage risk.
The fund’s investment strategy focuses on generating income for investors through a combination of dividend-paying equities and actively managed fixed-income securities. By emphasizing both growth potential and risk management, FSDIX works to provide investors with a balance of current income and long-term capital appreciation.
With a current yield of 2.68% and a net expense ratio of 0.66%, the fund has demonstrated a solid 52-week average return of 12.39%, highlighting its ability to deliver competitive performance for shareholders.
Portfolio Composition and Diversification
Fidelity Strategic Dividend & Income Fund’s portfolio is strategically diversified across sectors and industries, with a focus on dividend-paying stocks to generate income for investors. The fund’s 166 holdings span a wide range of sectors, including technology, financials, and healthcare, providing exposure to various growth opportunities while reducing risk through diversification.
The portfolio’s weighted average market capitalization of $200.57 billion reflects a concentration on large-cap, established companies that have a proven track record of generating consistent dividends. This approach aligns with the fund’s primary goal of income generation and potential capital growth, appealing to investors seeking a balanced and risk-managed investment solution.
With a primarily U.S. equity allocation, the Fidelity Strategic Dividend & Income Fund caters to individuals in the US seeking to Share My Personal, Sell or Share dividend-focused strategies.
The active management approach ensures regular portfolio reviews and adjustments, further enhancing the fund’s ability to adapt to changing market conditions and deliver consistent returns to its shareholders.
Risk and Performance Measures
The Fidelity Strategic Dividend & Income Fund exhibits a moderate level of volatility, as evidenced by its standard deviation of 3.64.
While its 5-year return of 8.81% places it in the 45th percentile within its category, the fund’s 10-year return of 7.78% ranks it in the 21st percentile, indicating its long-term performance relative to peers.
Additionally, the fund’s cost-effective approach, with a low net expense ratio of 0.66% and a turnover rate of 34%, further enhances its risk-return profile.
Volatility and Drawdowns
Historical volatility, as measured by the fund’s standard deviation of 3.64, reflects the degree of risk inherent in FSDIX’s investment strategy. This elevated level of volatility can be attributed to the fund’s focus on generating income through dividends and other strategic investments, which may expose it to greater market fluctuations.
Investors should be aware that FSDIX has experienced drawdowns in the past, meaning the fund has temporarily declined from its peak value to a lower trough. These drawdowns can be a source of concern for investors with a low risk tolerance, as they may be uncomfortable with the fund’s potential for sharp declines.
To assess the fund’s performance relative to its peers, investors can monitor FSDIX’s Lipper ranking, which opens in a new window, allowing them to compare the fund’s returns across different time frames.
Relative Performance Metrics
To additionally evaluate the Fidelity Strategic Dividend & Income Fund’s performance, investors can examine its relative risk and performance metrics compared to its peers. With a standard deviation of 3.64, the fund exhibits moderate historical volatility, suggesting a relatively stable return profile. The fund’s 5-year return of 8.81% places it in the 45th percentile within its category, indicating average performance over that time period.
Moreover, the fund’s lower-than-average net expense ratio of 0.66% suggests a cost-efficient structure compared to similar offerings. Additionally, the fund’s turnover rate of 34% implies a more long-term investment approach, which can be beneficial for tax-sensitive investors.
Despite the lack of available Alpha and Beta values, the fund’s consistent 10-year performance, ranking in the 21st percentile of its category, demonstrates its ability to deliver competitive results over the long run.
| Metric | Fidelity Strategic Dividend & Income Fund | Peer Average |
|---|---|---|
| Standard Deviation | 3.64 | N/A |
| 5-Year Return | 8.81% | N/A |
| Net Expense Ratio | 0.66% | N/A |
Fees and Expenses
In addition, Fidelity Strategic Dividend & Income Fund (FSDIX) carries a management fee of 0.72% and does not levy a 12b-1 fee. This means that investors in FSDIX do not incur additional charges for the fund’s distribution and marketing expenses.
Moreover, FSDIX does not have a front-end load fee, which is a one-time charge deducted from an investor’s initial investment.
Redemption fees for FSDIX may vary depending on specific circumstances, such as the holding period of the investment. However, the fund does not disclose the exact redemption fee structure, leaving investors to inquire about these details before making a withdrawal.
The total expense ratio for FSDIX is 0.72%, which includes the management fee and other operating expenses. This expense ratio is in line with the industry average for similar actively managed equity funds.
Investors should note that the minimum investment required for FSDIX is not specified, so they should contact Fidelity to determine the initial investment threshold.
Yield and Distributions
The Fidelity Strategic Dividend & Income Fund offers a current yield of 2.68%, providing investors with a reasonable level of income.
The fund’s 52-week average return of 12.39% indicates its ability to generate capital appreciation alongside its dividend payouts.
Investors should evaluate the sustainability of the fund’s distributions and its overall approach to generating income and growth for their portfolios.
Current Yield Analysis
The Fidelity Strategic Dividend & Income Fund’s current yield of 2.68% offers investors a meaningful source of income compared to the prevailing low-interest-rate environment. This fund focuses on generating income through dividend-paying stocks, providing investors with regular payouts from the fund’s dividend income.
- The fund’s yield of 2.68% is higher than the average savings account interest rate, making it an attractive option for income-seeking investors.
- Distributions from the fund can provide a steady stream of income, helping to supplement retirement savings or support other financial goals.
- With a focus on dividend-paying stocks, the fund aims to provide a reliable and consistent source of income for its investors.
- The regular payouts from the fund can offer a sense of financial security and stability in an uncertain market environment.
- Investors in the Fidelity Strategic Dividend & Income Fund can expect to receive a meaningful level of income, which can be a valuable addition to their overall investment portfolio.
Distribution Frequency
Quarterly distributions from the Fidelity Strategic Dividend & Income Fund provide investors with a consistent stream of income, reflecting the portfolio’s focus on generating dividend yield. The fund is designed to offer regular payouts to shareholders, with distributions typically made on a quarterly basis. This frequency allows investors to receive periodic income throughout the year, which can be particularly appealing for those seeking a steady flow of returns.
The fund’s current yield of 2.68% underscores its emphasis on providing a balance between dividend income and potential capital appreciation. By targeting high-quality companies that exhibit strong dividend growth potential, the fund aims to deliver a combination of regular income and the opportunity for long-term capital gains.
This distribution strategy aligns with the fund’s objective of offering investors a reliable source of income while also preserving the potential for capital appreciation over time.
Dividend Sustainability
While the fund’s current yield of 2.68% reflects its emphasis on generating reasonable income, its underlying focus on dividend-paying equities suggests a commitment to the sustainability of those payouts over time. By investing at least 80% of its assets in dividend-paying stocks, the Fidelity Strategic Dividend & Income Fund aims to build a portfolio that can deliver consistent income distributions to investors.
- The fund’s substantial asset base of $2.995 billion provides it with the scale and diversification to navigate market volatility and sustain its dividend payouts.
- With a low Net Expense Ratio of 0.66%, the fund guarantees that a larger portion of investment returns flows directly to investors, enhancing the overall income-generating potential.
- The fund’s impressive 52 Week Average Return of 12.39% demonstrates its ability to generate capital appreciation in addition to income, further bolstering the sustainability of its dividend distributions.
- Fidelity’s disciplined investment approach and focus on dividend-paying companies with strong fundamentals contribute to the fund’s ability to deliver consistent and reliable income to its investors over the long term.
- The fund’s track record and the underlying strategies employed suggest that investors can expect a sustainable income stream from the Fidelity Strategic Dividend & Income Fund.
Manager Overview
Under the stewardship of Ramona Persaud, an experienced portfolio manager with over two decades in the industry, the fund employs a research-driven team approach to investment management. This collaborative approach allows the team to leverage their collective expertise and diverse perspectives to identify high-quality dividend-paying stocks with the potential for both income and capital growth.
Persaud and her team place a strong emphasis on risk management, regularly reviewing and adjusting the portfolio to navigate changing economic conditions. This disciplined approach is designed to help the fund capitalize on market opportunities while mitigating downside risk.
The fund’s focus on investing in companies with sustainable dividends and solid fundamentals aims to provide investors with a reliable income stream and the potential for long-term capital appreciation.
Related Resources
Alongside the fund’s investment strategy and management, investors may find additional resources valuable in evaluating FSDIX’s performance and positioning within their portfolios. Morningstar’s thorough analysis of the fund provides insightful perspectives on its investment process, management team expertise, and parent organization priorities.
Additionally, Fidelity’s website offers a wealth of information, including detailed fund overviews, performance data, and educational resources to help investors understand the fund’s objectives and positioning.
- Morningstar’s detailed analysis and ratings for FSDIX
- Detailed fund information and performance data on Fidelity’s website
- Educational resources on dividend-focused investing strategies
- Comparisons to FSDIX’s custom benchmark and similar funds
- Discussions with Fidelity representatives to address specific questions
Frequently Asked Questions
What Is the Dividend Income Strategy of Fidelity?
Fidelity’s dividend income strategy involves actively selecting high-quality, dividend-paying companies to generate a high level of current income and potential capital appreciation for investors seeking a balanced approach to generating returns.
Is Fsdix a Good Investment?
The fund’s strong historical performance, diversified portfolio, low expense ratio, and experienced management team suggest FSDIX could be a good investment option for those seeking dividend income and capital appreciation. However, investors should conduct their own due diligence to determine its suitability for their specific financial goals and risk tolerance.
Is Fidelity Dividend Growth Fund a Good Investment?
The Fidelity Dividend Growth Fund can be a suitable investment option for income-oriented investors seeking a balance between dividends and potential capital appreciation, given its focus on companies with a history of increasing dividends and its solid track record.
Is Fagix a Buy or Sell?
FAGIX, the Fidelity Advisor Growth Opportunities Fund, is a diversified growth fund that invests primarily in large-cap domestic equities. Investors may consider FAGIX as a buy option given its strong long-term performance and experienced management team.
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