The 3 Best Fidelity Funds for Growth

Growth stock funds have the short-term momentum now. Fidelity funds are leaders in the high-quality, low-cost, actively-managed arena of mutual funds.

Fidelity mutual fundsTherefore, if you are looking for one of the best growth funds out there, look no further than Fidelity funds.

Growth funds are not just smart short-term plays for the late phase of the business cycle. They can also be solid core holdings for a diversified portfolio. Thus far in 2015, the average large-growth stock fund is up 3.5%, whereas the S&P 500 index is just below 1%. Going out a full decade, the 10-year annualized return of the average large-growth fund is 9%, edging out the S&P 500 at 8.5%.

And that’s just the average. Those invested in the outperformers of the group — including a few of these best-in-class Fidelity funds — can expect even more.

Best Fidelity Funds for Growth: Fidelity Growth Company (FDGRX)

Expenses: 0.82%, or $82 for every $10,000 invested

Fidelity Growth Company (MUTF:FDGRX) has earned five stars from Morningstar and sits high in the ranks of large growth mutual funds.

FDGRX is one of the best-performing large-cap growth funds of the past decade. Longtime manager Steve Wymer has led Growth Company to an incredible record during his tenure. The 10-year annualized return of 12% beats 98% of all large-cap growth funds, and it easily eclipses the 8.1% return on the S&P 500 for the same period. Even the 15-year returns beat the S&P 500, as well as nearly 80% of all large growth funds.

Wymer’s management style is primarily of a buy-and-hold nature, as evidenced by the low 12% turnover, which makes his long-term performance that much more impressive. This low churn rate keeps costs low and further supports long-term performance.

The top sectors in FDGRX are technology, health care and consumer cyclicals. Top holdings include Apple Inc. (NASDAQ:AAPL),, Inc (NYSE:CRM) and Facebook Inc (NASDAQ:FB).

FDGRX requires a minimum investment of just $2,500, and the 0.82% expense ratio is below average.

Best Fidelity Funds for Growth: Fidelity Capital Appreciation Fund (FDCAX)

Expenses: 0.82%

The Fidelity Capital Appreciation Fund (MUTF:FDCAX) is another member of the Fidelity funds lineup  that is well-managed and boasts an outstanding track record.

Lead manager J. Fergus Shiel has been at the helm of Fidelity Capital Appreciation for nearly a decade, and his management style has a go-anywhere, high turnover flair that has led to top-notch performance in the past decade.

Performance ranks across the board are above average, capped by the 10-year performance rank of 27, placing FDCAX ahead of more than 70% of all large growth funds since 2005.

Unlike most other growth funds, the Fidelity Capital Appreciation portfolio is under-weight in the technology sector but overweight in healthcare , financials and consumer cyclical stocks. Top holdings include Gilead Sciences, Inc. (NASDAQ:GILD), Ameriprise Financial, Inc. (NYSE:AMP) and Starbucks Corporation (NASDAQ:SBUX).

Minimum initial investment is $2,500.

Best Fidelity Funds for Growth: Fidelity Select Technology Portfolio (FSPTX)

Expenses: 0.78%

Fidelity Select Technology Portfolio (MUTF:FSPTX) isn’t just among the better Fidelity funds out there — it’s also on the overall short list of tech sector funds.

In a crowded field of tech funds, Fidelity Select Technology is beating 94% of category peers with a year-to-date gain of just less than 6%. Fund manager Charlie Chai has been at the helm for eight years, and has put up an impressive performance record, with one-, three- and five-year returns all comfortably above category averages.

The technology sector holdings in the portfolio are predominately large-cap U.S. stocks, at about 80% allocation, with the remainder in foreign companies. Top holdings include Apple, Facebook and Google Inc (NASDAQ:GOOG, NASDAQ:GOOGL).

And like the rest of these funds, FSPTX requires just a $2,500 minimum investment.

As of this writing, Kent Thune did not hold a position in any of the aforementioned securities. Under no circumstances does this information represent a recommendation to buy or sell securities.

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