July 9, 2002 — Like his predecessor, the new manager of the Fidelity Fifty Fund (FFTYX), Fergus Shiel, is not afraid to make big bets on a handful of sectors, mutual fund observers say.
Lately, though, he’s been concentrating on totally different industries than had John Muresianu, who stepped down as the fund’s pilot last month, Fidelity watchers say. Muresianu had run the fund since January 1999.
Fidelity said Shiel, who continues to oversee Fidelity Independence (FDFFX), has a “flexible” investment style, and observers agree that although he has favored growth stocks in the past, he is also willing to invest in undervalued fare.
“In essence, they’re the same,” says David Pittelli, an analyst with Jim Lowell’s Fidelity Investor newsletter, commenting on Shiel’s and Muresianu’s approaches to stock picking. “Except they just happen to have different ideas about what sectors to be in right now.”
John Bonnanzio, group editor of Fidelity Insight, another newsletter that tracks Fidelity funds, says the Independence and Fifty funds have both been investing defensively of late, but they have not been seeking safety in the same places.
For example, the Fifty Fund, which holds about 50 stocks, had nearly 26% of its assets in energy stocks at the end of May, and mining companies then accounted for three of its top ten holdings, including its No. 1 stock, Newmont Mining (NEM).
By contrast, consumer stocks made up nearly 56% of the Independence Fund’s portfolio, and energy stocks only 7% on May 31. Tobacco companies held the first, second and seventh positions in the fund at the end of the first quarter.
Bonnanzio echoes Pittelli’s assessment of Shiel and Muresianu. “Style-wise, there probably isn’t a huge amount of difference” between them, which is why Shiel was shifted into the Fifty Fund, says Bonnanzio, adding, “it’s an appropriate fit.”
Of Shiel, Bonnanzio said: “I don’t know him necessarily to be a value or a growth guy. I tend to think of him as someone who’s going to go wherever the opportunities appear to be.”
Although he has taken a value-oriented stance recently, observers note that Shiel had favored faster growing technology companies in the Independence Fund in the late 1990s and through 2001.