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Fidelity's Magellan Gains on Tech Bets

Fidelity's Magellan Fund is riding the success of tech superstars Apple and Google, and beating rival mutual funds.
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TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

Fidelity Investments' Magellan Fund


is riding the success of tech superstars






this year, returning 7.3% as the

stock market


So far this year, Magellan has generated the second-best performance among the 50 largest stock

mutual funds

that are actively managed. Almost 35% of the fund is invested in technology and communications companies.

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Apple and Google have brought big windfalls to Magellan this year, gaining 47% and 27%, respectively.

Cisco Systems





also have jumped more than 10%. All four companies were among the fund's top 20 holdings at the end of March.


Van Kampen Capital Growth Fund


was the group's best performer, returning 18% as the

S&P 500

index fell 4.5%. Van Kampen managers also bet on tech stocks, including





, which have jumped more than 50% this year.

There were several losers among these funds, which each have at least $10 billion in assets. Financial stocks were largely to blame.


Harbor International Fund


has lost 8% this year. The fund has 27% of its assets in finance companies, such as




Lloyds Banking Group



Sumitomo Trust & Banking

. These stocks have dropped more than 20% each.

Closer to home, the

American Washington Mutual Investors Fund


shed 7.9%. The fund suffered as




Fifth Third Bancorp



SunTrust Banks


have lost about half their value.

Bank of America


, another holding, is down 38%.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.