The return of Fidelity Magellan?
Posted by adesigar on October 24, 2006
Peter Lynch managed the Fidelity Magellan fund from 1977 to 1990 averaging 29% returns over the period of 14 years. At one point the fund grew assets to an unmanageable $100 billion. In recent years the fund became an Index hugger with most stock picks matching the S&P. Factoring in expenses the fund underperformed its category and even the S&P 500 index for years.
Stansky who managed Magellan for nearly a deade retired October last year. He was replaced by Harry Lange. One year later the fund looks a lot more interesting to me. A year ago the top 10 holdings in order of percentage of assets were GE, Microsoft, ExxonMobile, HomeDepot, Citigroup, J&J, Intel, Lowes and Viacom. This year the fund has Nokia, Slumberger, J&J, UnitedHealth, GE, Peabody, AIG, Google, Genentech and Corning. When you manage $45 Billion you need to find good large cap stocks wherever you can, so its great to see Harry Lange is looking at international stocks, the fund has Nokia, Nomura, Canadian Natural Resources and Samsung among its top 25 holdings.
Only time will tell if the fund returns to its glory days but its a step in the right direction.
Conflicts: My 401k is managed by Fidelity and I have avoided the Magellan Fund in the past.
One Response to “The return of Fidelity Magellan?”
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Michelle said
Magellen is back to beating the S&P 500 now that Harry Lange is at the helm. Would you still continue to avoid Magellan?