Fidelity New Markets Income
Bond yields are at rock-bottom levels in the U.S. and Europe. but investors who look for income abroad can find more attractive opportunities.
Case in point: the Fidelity New Markets Income (MUTF:FNMIX), which has a yield near 5%.
FNMIX’s portfolio manager, John Carlson, takes a conservative approach. To this end, he tends to focus on dollar-denominated sovereign bonds, which have a good track record in periods of instability. However, to juice returns, Carlson also will selectively purchase stocks.
Country allocation is heaviest in Venezuela, Mexico and Turkey, though the fund also has an allowance for domestic holdings; the U.S. currently makes up about 9% of the portfolio.
FNMIX is up more than 7% in the past year and has averaged annual returns in the low teens like clockwork for years; it also sports a decent expense ratio of 0.86% and has a 4-star rating.