Fidelity growth company commingled pool

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CharlesNorris
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Fidelity growth company commingled pool

Post by CharlesNorris »

I utilize a boglehead, passive index fund approach to investing via total stock market and s&p 500 funds. With that being said, one of the accounts that I have (Ohio 457 deferred compensation) has an actively managed fund (.34% expense ratio) that seems to crush it. Every time I look at the investment performance report it seems to crush every other fund. The fund is Fidelity Growth Company Commingled pool. It is not a publicly traded mutual fund and doesn’t have a ticket symbol or prospectus. However at every interval it blows what I use (VAnguard institutional Index .02% expense ratio) out of the water. The fund is only 7 years old but every interval is a solid 8-20% higher Than Vangurd institutional index. Does anyone invest in this fund or have any advice to pursue it or stay away from it?
Grt2bOutdoors
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Re: Fidelity growth company commingled pool

Post by Grt2bOutdoors »

There are funds/investors who are able to beat the market. The manager of this particular fund, Steve Wymer is one of those people. If you want to invest in it do so, the expense ratio for this fund seems to be worth the price. However, just remember this, if the manager leaves fund performance may suffer, if large growth falls out of favor, the same. Indexing will guarantee the market returns, nothing more and nothing less. It’s certainly okay to invest with what you feel comfortable with and you don’t need our permission to do so. Good Luck! BTW, the fund you are looking at is the same as Fidelity Growth Company, FDGRX, only this one has lower expenses as a results of being a commingled trust.

The naysayers will be along shortly!
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backpacker61
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Re: Fidelity growth company commingled pool

Post by backpacker61 »

That would be an institutional class holding of the Fidelity Growth Company mutual fund.

Growth company stocks have been on a tear for the last several years. At some point Value (undervalued) stocks may regain favor with investors, although no one can predict when that would happen. Your Vanguard Institutional Index fund will have exposure to both Growth and Value stocks, which will have held it back performance-wise over the past several years.

If you expect Growth Company stocks will continue to outperform for the foreseeable future, Fidelity's commingled pool would be an excellent fund to hold for that, but honestly, I have no idea if that will be the case or not.

I'm sticking with Vanguard's S&P 500 fund in my 401K account, which does have both Growth and Value stocks.

For what it's worth, I owned Fidelity Magellan (a large growth company mutual fund run by legendary fund manager Peter Lynch) in the mid 1980's to the 1990's. Been there, done that, got the t-shirt. Sold and moved into Fidelity Total Stock Market Index (FSKAX). Never looked back.
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snailderby
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Re: Fidelity growth company commingled pool

Post by snailderby »

Is this a collective investment trust version of the Fidelity Growth Company Fund, which seems to share the same name, or is it a completely different animal?

1. This fund is a growth fund, so a more appropriate benchmark would be a growth index fund rather than a total stock market fund. More importantly, do you want to bet on growth continuing to outperform value going forward? If you don't know whether growth or value will do better in the future, wouldn't it be better to just own both (using a total stock market fund)?

2. This fund is actively managed. There are a handful of actively managed funds that have outperformed their benchmarks in the past. But past performance doesn't guarantee future performance. It's not even a particularly good predictor of future performance.

3. On the plus side, 0.34% is a low ER (relatively speaking) for an actively managed fund.
Topic Author
CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

Grt2bOutdoors wrote: Sat Oct 17, 2020 6:47 am There are funds/investors who are able to beat the market. The manager of this particular fund, Steve Wymer is one of those people. If you want to invest in it do so, the expense ratio for this fund seems to be worth the price. However, just remember this, if the manager leaves fund performance may suffer, if large growth falls out of favor, the same. Indexing will guarantee the market returns, nothing more and nothing less. It’s certainly okay to invest with what you feel comfortable with and you don’t need our permission to do so. Good Luck! BTW, the fund you are looking at is the same as Fidelity Growth Company, FDGRX, only this one has lower expenses as a results of being a commingled trust.

The naysayers will be along shortly!
Thanks for the info and knowledge. I don’t know yet if I want to move a small percentage of my portfolio into this but I defintely appreciate the info to help with the decision
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CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

backpacker61 wrote: Sat Oct 17, 2020 6:51 am That would be an institutional class holding of the Fidelity Growth Company mutual fund.

Growth company stocks have been on a tear for the last several years. At some point Value (undervalued) stocks may regain favor with investors, although no one can predict when that would happen. Your Vanguard Institutional Index fund will have exposure to both Growth and Value stocks, which will have held it back performance-wise over the past several years.

If you expect Growth Company stocks will continue to outperform for the foreseeable future, Fidelity's commingled pool would be an excellent fund to hold for that, but honestly, I have no idea if that will be the case or not.

I'm sticking with Vanguard's S&P 500 fund in my 401K account, which does have both Growth and Value stocks.

For what it's worth, I owned Fidelity Magellan (a large growth company mutual fund run by legendary fund manager Peter Lynch) in the mid 1980's to the 1990's. Been there, done that, got the t-shirt. Sold and moved into Fidelity Total Stock Market Index (FSKAX). Never looked back.

Thanks for the info. Like you, I have no clue whether growth will continue on this tear (which is why I index) but man it looks enticing when year in and year out this fund is posting +20% gains
Topic Author
CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

snailderby wrote: Sat Oct 17, 2020 7:04 am Is this a collective investment trust version of the Fidelity Growth Company Fund, which seems to share the same name, or is it a completely different animal?

1. This fund is a growth fund, so a more appropriate benchmark would be a growth index fund rather than a total stock market fund. More importantly, do you want to bet on growth continuing to outperform value going forward? If you don't know whether growth or value will do better in the future, wouldn't it be better to just own both (using a total stock market fund)?

2. This fund is actively managed. There are a handful of actively managed funds that have outperformed their benchmarks in the past. But past performance doesn't guarantee future performance. It's not even a particularly good predictor of future performance.

3. On the plus side, 0.34% is a low ER (relatively speaking) for an actively managed fund.
Thanks for the info and knowledge. If I move any into this it would be a small percentage of my portfolio so I would still be in the total stock market. But I appreciate the advice to assist me in making an informed decision.
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1789
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Re: Fidelity growth company commingled pool

Post by 1789 »

I think you should use this fund, at least maybe for some percentage of your portfolio. The reason is that it is hard to find active funds that are NOT closed to new investors and good. This is one of them (another one: PrimeCAP). Maybe 50% SP500 and 50% Growth fund.

https://www.portfoliovisualizer.com/bac ... ion2_2=100
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Topic Author
CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

1789 wrote: Sat Oct 17, 2020 11:16 am I think you should use this fund, at least maybe for some percentage of your portfolio. The reason is that it is hard to find active funds that are NOT closed to new investors and good. This is one of them (another one: PrimeCAP). Maybe 50% SP500 and 50% Growth fund.

https://www.portfoliovisualizer.com/bac ... ion2_2=100
Thanks for the boost of confidence and the link to returns. I’m leaning on getting in. How much is yet to be determined :)
Cwise
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Re: Fidelity growth company commingled pool

Post by Cwise »

Looks like FDGRX Fidelity Growth Company Fund is closed to new investors. FBGRX might be something you look into.
000
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Re: Fidelity growth company commingled pool

Post by 000 »

0.34% ER is possibly surmountable for a competent active fund. My questions would be:
1. How does it compare to a growth index if one is available in your plan?
2. Are you prepared to accept that "growth" stocks could revert to the mean?
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avp
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Re: Fidelity growth company commingled pool

Post by avp »

Whenever I see the Fidelity Growth Company Commingled Pool do 65%+ YTD, I get a little FOMO as well. That fund consistently outperforms the Russell 3000 Growth Index. The fund is doing a great job this year, but not sure if it'll last, although the fund has posted 20%+ gains since inception. How long do you plan to invest in this fund? If it didn't post these crazy gains or meet your expectations, what would your next step be?
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Re: Fidelity growth company commingled pool

Post by Grt2bOutdoors »

Cwise wrote: Sat Oct 17, 2020 11:45 pm Looks like FDGRX Fidelity Growth Company Fund is closed to new investors. FBGRX might be something you look into.
That’s correct for retail investors. The OPs version though is open for institutional level plans of which he is a member of.
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Topic Author
CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

avp wrote: Sun Oct 18, 2020 12:55 am Whenever I see the Fidelity Growth Company Commingled Pool do 65%+ YTD, I get a little FOMO as well. That fund consistently outperforms the Russell 3000 Growth Index. The fund is doing a great job this year, but not sure if it'll last, although the fund has posted 20%+ gains since inception. How long do you plan to invest in this fund? If it didn't post these crazy gains or meet your expectations, what would your next step be?
That’s a great question and I know the 65% is impossible to replicate and I would be buying right now at a high which no one wants to do but honestly it’s a fund that every time that I look at the performance report it consistently beats the s&p 500 index that I’m in in this account. If I would buy it would be for the long term and buy and hold. I know there’s been years of volatility and I think l could stomach the losses and not panic and sell low. I’m 21-25 years away from retirement and needing access to this money.
Topic Author
CharlesNorris
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Re: Fidelity growth company commingled pool

Post by CharlesNorris »

000 wrote: Sat Oct 17, 2020 11:51 pm 0.34% ER is possibly surmountable for a competent active fund. My questions would be:
1. How does it compare to a growth index if one is available in your plan?
2. Are you prepared to accept that "growth" stocks could revert to the mean?
Yes reverting to the mean is a major drawback and something that is worrisome. There is not a growth index in the plan so I have nothing to compare it to or possibly purchase.
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1789
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Re: Fidelity growth company commingled pool

Post by 1789 »

CharlesNorris wrote: Sat Oct 17, 2020 7:49 am
backpacker61 wrote: Sat Oct 17, 2020 6:51 am That would be an institutional class holding of the Fidelity Growth Company mutual fund.

Growth company stocks have been on a tear for the last several years. At some point Value (undervalued) stocks may regain favor with investors, although no one can predict when that would happen. Your Vanguard Institutional Index fund will have exposure to both Growth and Value stocks, which will have held it back performance-wise over the past several years.

If you expect Growth Company stocks will continue to outperform for the foreseeable future, Fidelity's commingled pool would be an excellent fund to hold for that, but honestly, I have no idea if that will be the case or not.

I'm sticking with Vanguard's S&P 500 fund in my 401K account, which does have both Growth and Value stocks.

For what it's worth, I owned Fidelity Magellan (a large growth company mutual fund run by legendary fund manager Peter Lynch) in the mid 1980's to the 1990's. Been there, done that, got the t-shirt. Sold and moved into Fidelity Total Stock Market Index (FSKAX). Never looked back.

Thanks for the info. Like you, I have no clue whether growth will continue on this tear (which is why I index) but man it looks enticing when year in and year out this fund is posting +20% gains
Correction: Fund lifetime return before taxes is 14.50% (since 1983) vs. Russel 3000 growth 11.14%. There is no such CAGR +20% in over 20+ years. That would be WB’s fund, lol. Anyway, this fund had and expected to have a larger drawdown if growth gets slaughtered. It decreased ~70% during dot com bust. Just a note.
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infotrader
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Re: Fidelity growth company commingled pool

Post by infotrader »

I have the same fund (slightly different version) in my 403b plan, and it is the only fund that I own in the plan. I will sell it when the manager leaves.
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avp
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Re: Fidelity growth company commingled pool

Post by avp »

infotrader wrote: Sun Oct 18, 2020 11:43 am I have the same fund (slightly different version) in my 403b plan, and it is the only fund that I own in the plan. I will sell it when the manager leaves.
How's that been doing for you?
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1789
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Re: Fidelity growth company commingled pool

Post by 1789 »

infotrader wrote: Sun Oct 18, 2020 11:43 am I have the same fund (slightly different version) in my 403b plan, and it is the only fund that I own in the plan. I will sell it when the manager leaves.
Good idea
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infotrader
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Re: Fidelity growth company commingled pool

Post by infotrader »

avp wrote: Sun Oct 18, 2020 12:07 pm
infotrader wrote: Sun Oct 18, 2020 11:43 am I have the same fund (slightly different version) in my 403b plan, and it is the only fund that I own in the plan. I will sell it when the manager leaves.
How's that been doing for you?
Doing well so far, 27% 1 year return.
I also have non-contributing plan, and it is 51% in 1 year.
000
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Re: Fidelity growth company commingled pool

Post by 000 »

CharlesNorris wrote: Sun Oct 18, 2020 9:40 am
000 wrote: Sat Oct 17, 2020 11:51 pm 0.34% ER is possibly surmountable for a competent active fund. My questions would be:
1. How does it compare to a growth index if one is available in your plan?
2. Are you prepared to accept that "growth" stocks could revert to the mean?
Yes reverting to the mean is a major drawback and something that is worrisome. There is not a growth index in the plan so I have nothing to compare it to or possibly purchase.
In that case....

You've got to ask yourself one question: 'Do I feel lucky?' Well, do ya?
Busdrvr
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Re: Fidelity growth company commingled pool

Post by Busdrvr »

CharlesNorris wrote: Sat Oct 17, 2020 7:45 am
Grt2bOutdoors wrote: Sat Oct 17, 2020 6:47 am There are funds/investors who are able to beat the market. The manager of this particular fund, Steve Wymer is one of those people. If you want to invest in it do so, the expense ratio for this fund seems to be worth the price. However, just remember this, if the manager leaves fund performance may suffer, if large growth falls out of favor, the same. Indexing will guarantee the market returns, nothing more and nothing less. It’s certainly okay to invest with what you feel comfortable with and you don’t need our permission to do so. Good Luck! BTW, the fund you are looking at is the same as Fidelity Growth Company, FDGRX, only this one has lower expenses as a results of being a commingled trust.

The naysayers will be along shortly!
Thanks for the info and knowledge. I don’t know yet if I want to move a small percentage of my portfolio into this but I defintely appreciate the info to help with the decision

Congrats on the fortune of access to FGCCP.. I also have this in my 401k and it is listed as fund 31617e836 with a .43%ER. https://fd.broadridge.com/funddescripto ... nkID=FGCCP
I gained access to this and PRNHX in early 2018 and have built up a substantial position in both since and it has really propelled my portfolio performance over the period. It has a stellar track record since inception and ranks very high among its peers, see Morningstar for FDGRX... It makes up 30% of my equity allocation in this account. The account has returned 30% ytd and 30% over 12 months. That said I accept the increased risk, but watch it like a hawk. I have been pleased with how it performed in both March and September. It’s not boglehead approved, but I can’t pass up the opportunity.
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avp
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Re: Fidelity growth company commingled pool

Post by avp »

Busdrvr wrote: Sun Oct 18, 2020 4:28 pm That said I accept the increased risk, but watch it like a hawk.
I don't blame you for doing so, though I wonder, what's your exit plan for this holding? What would make you tap out?
Busdrvr
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Re: Fidelity growth company commingled pool

Post by Busdrvr »

avp wrote: Mon Oct 19, 2020 1:50 am
Busdrvr wrote: Sun Oct 18, 2020 4:28 pm That said I accept the increased risk, but watch it like a hawk.
I don't blame you for doing so, though I wonder, what's your exit plan for this holding? What would make you tap out?
Depending on macro conditions I might consider paring this holding if it underperformed it’s benchmark for 2 consecutive quarters. Other reasons might be in case of a decision to shift my AA or a change in management.

I have more confidence in PRNHX as it has a much longer track record of outperformance and despite a change in manager about 18 months ago it also continues its excellent run.
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