Is Fidelity Japan Fund (FJPNX) a Strong Mutual Fund Pick Right Now?

Any investors hoping to find a Japan - Equity fund could think about starting with Fidelity Japan Fund (FJPNX). FJPNX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We note that FJPNX is a Japan - Equity option, an area loaded with different choices. Primarily invest in companies in one of the world's richest and most diversified economies, Japan. While the country remains partially exposed to global economic trends due to its export focus, its lack of natural resources can also impact the nation.

History of Fund/Manager

FJPNX finds itself in the Fidelity family, based out of Boston, MA. Since Fidelity Japan Fund made its debut in September of 1992, FJPNX has garnered more than $410.71 million in assets. The fund is currently managed by Kirk Neureiter who has been in charge of the fund since March of 2014.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 9.22%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 11.71%, which places it in the top third during this time-frame.

When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 10.89%, the standard deviation of FJPNX over the past three years is 11.79%. The standard deviation of the fund over the past 5 years is 12.3% compared to the category average of 11%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. FJPNX lost 53.22% in the most recent bear market and outperformed its peer group by 8%. This might suggest that the fund is a better choice than its peers during a bear market.

Investors should note that the fund has a 5-year beta of 0.84, so it is likely going to be less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. Over the past 5 years, the fund has a negative alpha of -0.45. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FJPNX is a no load fund. It has an expense ratio of 0.99% compared to the category average of 1.37%. Looking at the fund from a cost perspective, FJPNX is actually cheaper than its peers.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

Overall, Fidelity Japan Fund ( FJPNX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Japan Fund ( FJPNX ) looks like a somewhat average choice for investors right now.

Don't stop here for your research on Japan - Equity funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FJPNX to its peers as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.

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