Fidelity MagellanFMAGX

Morningstar Rating

Fund Research and Analysis

by Christopher Davis

Fidelity Magellan may be pulling in its horns, but it still packs a punch.

After a crushing 2008, this fund is on the comeback trail. Since stocks' March 9, 2009, low, the fund has rallied 72% through Oct. 13, topping the large-growth average by 17 percentage points. Read more

Kudos

Management has delivered outstanding results during growth rallies and has a fine overall record at Fidelity.

The fund's overall costs are moderate and contain a performance-based incentive. Read more

Risks

Management has been broadening the fund's portfolio, but the fund's heavy technology, financials, and industrials weighting heighten its economic sensitivity.

Sizable foreign weighting exposes the fund to currency risk. It also creates potential overlap issues with other holdings in a portfolio.

Outflows could cause management to sell stocks to meet redemptions, potentially forcing it to lock in losses and thus limit the fund's rebound potential.

Although the manager relied a lot on small and midsize stocks for his other funds, he can't take as big positions in such names at this offering. Read more

Strategy

Harry Lange favors fast-growing companies that are benefiting from larger trends. He is valuation-conscious, however, and typically likes to lighten his positions in companies that are trading richly and buy in when they're slumping. Read more

Management

Before taking over this fund on Oct. 31, 2005, Harry Lange ran Fidelity Capital Appreciation for nearly 10 years and Fidelity Advisor Small Cap FSCTX for nearly seven years. Lange joined Fidelity as an analyst in 1987, served as a research director in Japan, and managed the firm's technology offerings before moving on to run diversified funds. Read more

Inside Scoop

Harry Lange took control of this fund in late October 2005. Lange brought a great record at Fidelity Capital Appreciation to this fund, though he's enjoyed mixed success since coming aboard. Read more

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