Fidelity Investments is a mutual fund company with a wide selection of mutual funds. Some of the best Fidelity funds to buy are arguably their growth stock funds that have aggressive objectives. Investors who want the opportunity for above-average returns, and are willing to accept above-average market risk, may be interested in these investment types.
What Is Fidelity Investments?
Fidelity Investments is best known as a mutual fund company and provider of retirement services and products, such as 401(k) plans and IRAs, for businesses and individuals. Fidelity is also an online discount brokerage firm. Founded in 1946, it is one of the largest multinational financial services corporations in the world with 30 million customers and $8.3 trillion in total assets.
As a mutual fund company, Fidelity has risen on the backs of some of their widely held mutual funds, such as Fidelity Contrafund (FCNTX), managed by William Danoff and Fidelity Magellan (FMAGX), made famous in the 1980s by legendary fund manager Peter Lynch.
If you want to build your own portfolio of aggressive growth stock funds, you may want to see our article, Sample Aggressive Portfolio of Mutual Funds. You'll see how to allocate funds and diversify investments to minimize risk while maximizing returns.
Best Fidelity Funds for Aggressive Stock
With one of the widest selections of mutual funds in the industry, Fidelity offers a variety of stock mutual funds, including some of the best aggressive growth stock funds on the market:
- Fidelity Low-Priced Stock (FLPSX): If you want to consider an outstanding aggressive mid-cap stock fund with a value objective, take a close look at FLPSX. Manager Joel Tillinghast has run the fund since inception more than 30 years ago and has produced category-beating performance. The fund's return since inception, through March 31, 2020, was a remarkable 12.0%. That's especially impressive considering that period contains three of the worst bear markets in history. The fund's one-, three-, five-, and 10-year returns all beat category averages. This performance earns the fund a five-star rating (out of five stars). The expense ratio for FLPSX is below average at 0.53% and there is no minimum initial investment.
- Fidelity Growth Company (FDGRX): This is another aggressive Fidelity fund with a long manager tenure. Steve Wymer has been at the helm of FDGRX since 1997, producing an impressive 13% annualized return in that time. That compares to 10.20% on the Russell 3000 index during the same period. The expense ratio for FDGRX is low at 0.83% and there is no minimum initial investment. FDGRX is known to close to new investors when assets get too high to manage effectively. Be sure to check the availability of shares to purchase. Also, 401(k) participants may be able to purchase new shares, even if the fund is closed to other investors.
- Fidelity Mid-Cap Stock (FMCSX): Mid-cap stocks are good aggressive funds because they have greater growth potential than large-cap stocks, especially in the long run. Mid-cap companies are also generally more established than small-cap companies, making their stocks more stable. This makes mid-cap stocks more attractive than large- or small-cap stocks. The long-term returns for FMCSX have averaged higher than most mid-cap stock funds and the S&P 500 Index. The expense ratio for FMCSX is 0.73%, which is reasonable for a high-quality mid-cap stock fund, and there is no minimum initial investment.
Aggressive stock funds typically have greater growth potential than broad market indices. However, this higher potential for above-average returns brings greater market risk. Before investing in aggressive stocks or aggressively invested mutual funds, investors should be sure they are aligned with their financial goals and tolerance for risk.
Frequently Asked Questions (FAQs)
How do I make my Fidelity target-date mutual fund more aggressive?
A target-date fund automatically shifts its holdings as time passes, and individual shareholders don't have a say in how those adjustments happen. In other words, you can't make a target-date fund more aggressive. Most target-date funds are designed to do the opposite—become gradually less aggressive and more conservative—so that they fit well in retirement accounts. If you think a target-date fund isn't aggressive enough for you, then you'll likely need to find another fund that better matches your goals.
What is the average expense ratio for an aggressive mutual fund?
Whether a fund is aggressive or conservative has little to do with the expense ratio. The ratio is much more likely to fluctuate based on the fund's management style. When a fund's managers actively choose which stocks to buy or sell rather than passively following an index, the expense ratio will be higher, regardless of the risk tolerance or goals. For example, a small-cap index fund may have an aggressive risk tolerance, but the expense ratio will probably be relatively low, since it's passively managed.
The Balance does not provide tax, investment, or financial services or advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk, including the possible loss of principal.