Smarter Money: Evaluating Fund Literature

Here's something no financial print publication in the world would ever contemplate doing. Over the course of the next few days, I'm going to give the Fidelity managers of the Fidelity Select Portfolios a report card based on their semiannual report I just got in the mail. I'm well aware that Morningstar rates funds, but they aren't rated by a manager who has been picking stocks professionally for the last 18 years and they aren't evaluated by someone who has had to pick stocks in the same sectors that these folks do.

The newspapers and magazines won't do it, either. Fidelity represents a massive amount of the advertising world out there. They'd rather not take the chance. I don't know if TSC has a relationship with Fidelity, nor do I care. I know the folks at Fidelity and if you treat them honestly and call them as you see them, they're not going to blacklist me or take me off their mailing list. I'm as good and as loyal a Fidelity shareholder as you're going to find.

A word on my methodology. I'm using the public record that Fidelity sent, replete with all the information that it thinks is necessary to make a judgment. If the holdings that I'm basing these judgments on aren't up to date, that's not my fault. I'm using the manager's own words, direct from the report.

So, without further ado, I'm taking them in the order in which they appear in the booklet. My criticism is meant constructively. Fidelity's managers are pros. They aren't bums. No reason to excoriate here, I just want to help you make as informed a decision as possible. All figures are with load. ...