Fidelity has named new portfolio managers to six of its sector funds, the company announced. The changes, which take effect Jan. 31, follow the departure of Michael Tarlowe, who managed two Fidelity sector funds that performed badly last year due to heavy technology exposure.
Meanwhile, Tom Sprague, manager of the
Fidelity Asset Manager and the
Fidelity Asset Manager Growth funds, is taking a three-month leave of absence, according to Fidelity. Sprague is "taking some time off to transition from his current portfolio manager position to
become a consultant to the equity research department on special projects," says Vincent Loporchio, a Fidelity spokesperson.
Fidelity Select Multimedia fund and the
Fidelity Select Leisure funds shed 23% and 24.5%, respectively, under Tarlowe's watch last year. However, in 1999, the funds delivered returns of 44.1% and 32.8%, according to
Given the funds' heavy tech exposure, it was not surprising they delivered negative returns last year, says John Bonnanzio, editor of
. Fidelity Select Multimedia's 23% slide last year actually beat its benchmark
Broadcast Media Index's negative 27.8% return, Bonnanzio says. However, Fidelity Select Leisure's 24.5% decline was considerably worse than the S&P Leisure Time Index's 8.8% fall in 2000, Bonnanzio says.
Victor Thay will now manage the Fidelity Select Multimedia fund, while Charles Hebard is now manager of the Fidelity Select Leisure fund. Thay has been managing the
Fidelity Select Home Finance fund, which delivered a 50.2% return in 2000 and is down 9.42% year to date. Hebard has been an equity research analyst.
Succeeding Thay on the Fidelity Select Home Finance fund will be Jeffrey Feingold, who has been managing the
Fidelity Select Defense & Aerospace and the
Fidelity Select Air Transportation funds. These funds delivered 18.9% and 39.8% returns in 2000, respectively, and are off 0.42% and down 4.24% so far in 2001.
Matthew Fruhan will take over the reins from Feingold on these two funds, removing Fruhan from his current role as portfolio manager of the
Fidelity Select Food & Agriculture fund. This fund was up 29.8% in 2001 and is down 5.98% so far in 2001.
Gail Bronwyn Lese, who is now an equity research analyst, will take over the helm of the Fidelity Select Food & Agriculture fund from Fruhan.
Even if Tarlowe hadn't left Fidelity, it's common for the company to rotate its Select fund portfolio managers, Bonnanzio says. "These are short tenures" for portfolio managers; Fidelity looks for Select skippers to prove themselves before assigning them to diversified funds, he says.
Robert Stansky of the
Magellan fund, for example, once ran the Select Defense & Aerospace fund. Steven Kaye, manager of the
Fidelity Growth & Income fund, ran four Select funds in a five-year period.
Also, Charles Mangum, manager of the
Fidelity Dividend Growth fund, also a large blend fund, will take over the equity portion of the funds Sprague had been managing, effective Feb. 1, Loporchio said. Mangum is one of Fidelity's "most seasoned portfolio managers,
and has beaten 92% of his Lipper fund peers since he took over the reins" of the fund in January 1997, Loporchio said. The fund delivered a 12.3% return in 2000 and is up 1.67% in 2001.
The Asset Manager fund, a domestic hybrid fund, was up 2.4% in 2000 and is down 0.18% year to date, while the Asset Manager Growth fund, a large blend fund, was down 3.5% last year and is off 0.63% in 2001 so far.