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The U.S. market remains volatile due to shifting domestic and foreign policies under President Donald Trump’s new administration. Investors are still concerned about the impact of new tariff policies on inflation and the domestic economy. However, Chairman Jerome Powell’s comment that the Fed is still committed to its initial revised guidance of two rate cuts in 2025 to lower interest rates by a half-percentage point brought some relief.

The Consumer Price Index (CPI) increased 0.2% in February after rising 0.5% in January, much cooler than expected. On an annual basis, CPI dropped 2.8% from 3% in January. Retail sales grew solidly despite worries over economic slowdown and rising inflation. Retail sales increased by 0.2% in February, better than the downwardly revised decline of 1.2% in January. As per a report by the University of Michigan, preliminary consumer sentiment for March decreased to 57.9 from 64.7 reported in February. As anticipated, The Federal Open Market Committee has kept the key interest rate unchanged in the range of 4.25-4.5% in its last meeting.

Amid such uncertain market conditions, mutual fund investing can help those who wish to diversify their portfolio among various asset classes but lack professional expertise in managing funds. Fidelity mutual funds like Fidelity Select Semiconductors Portfolio (FSELX - Free Report) , Fidelity Select Insurance Portfolio (FSPCX - Free Report) , Fidelity New Millennium Fund (FMILX - Free Report) and Fidelity Large Cap Stock (FCLKX - Free Report)  should be good choices since they provide low-cost and uncomplicated equity funds that can help investors meet their goals.

These funds have wide exposure in industries like finance, industrial cyclical, utilities, technology and energy. These have not only preserved investors’ wealth but also generated excellent returns.

Why Invest in Fidelity Mutual Funds?

Fidelity mutual funds would be a compelling choice for investors. This is because Fidelity mutual funds have given positive returns in the past and are expected to perform well in the long run.

Headquartered in Boston, MA, Fidelity Investment is one of the oldest and most trusted mutual fund companies in the world. The company was founded in 1946 and had 51.5 million individual investors and $15.1 trillion of assets under administration as of Dec. 31, 2024.

Fidelity Investment company has more than 77,000 associates in 11 countries across North America, Europe, Asia and Australia to carry out extensive and in-depth research and provide potential investment avenues worldwide to their clients.

The company provides best-in-class financial planning, advisory services, retirement planning wealth management, brokerage services to its clients. Thus, investors who wish to diversify their portfolio among various asset classes but lack professional expertise in managing funds can choose Fidelity mutual funds. Fidelity Investment sells its mutual fund products directly to its clients, which results in a zero-load charge.

We have thus selected four Fidelity mutual funds that boast a Zacks Mutual Fund Rank #1 (Strong Buy), have positive three-year and five-year annualized returns, and minimum initial investments within $5000. The funds carry an expense ratio of less than 1%. Notably, mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges mostly associated with stock purchases.

Fidelity Select Semiconductors Portfolio invests most of its net assets in common stocks of domestic and foreign companies that areprincipally engaged in the design, manufacture, or sale of semiconductors and semiconductor equipment. FSELX chooses to invest in stocks based on fundamental analysis factors such as each issuer's financial condition, industry position, and market and economic conditions.

Adam Benjamin has been the lead manager of FSELX since March 15, 2020. Most of the fund’s exposure was in companies like NVIDIA (24.9%), Broadcom (6.5%) and ON Semiconductors (6.4%) as of Nov. 30, 2024.

FSELX’s three-year and five-year annualized returns are nearly 23.1% and 31.7%, respectively. FSELX has an annual expense ratio of 0.63%.

Fidelity Select Insurance Portfolio fund invests most of its net assets in common stocks of domestic and foreign companies that areengaged in underwriting, reinsuring, selling, distributing, or placing property and casualty, life, or health insurance. FSPCX advisors choose to invest in stocks based on fundamental analysis factors like financial condition and industry position, along with market and economic conditions.

Fahim Razzaque has been the lead manager of FSPCX since July 13, 2022. Most of the fund’s exposure was in companies like Chubb (10.8%), AON (8.1%) and Arthur J. Gallagher (8.1%) as of Nov. 30, 2024.

FSPCX’s three-year and five-year annualized returns of 18.4% and 19.1%, respectively. FSPCX has an annual expense ratio of 0.70%.

Fidelity New Millennium Fund invests the majority of its net assets in the common stocks of small and medium-sized companies that exhibit either growth or value characteristics or both. FMILX advisors generally invest in companies that may benefit from long-term changes due to technological advances, product innovation, economic plans, demographics, social attitudes, and other factors.

Daniel Sherwood has been the lead manager of FMILX since Oct. 19, 2022. Most of the fund’s exposure was in companies like NVIDIA (6.9%), Microsoft (5.9%) and Apple (5.6%) as of Nov. 30, 2024.

FMILX has three-year and five-year annualized returns of 16.8% and 18.5%, respectively. FMILX has an annual expense ratio of 0.77%.

Fidelity Large Cap Stock invests most of its net assets in common stocks of large market capitalization companies with market capitalization similar to the companies listed on the Russell 1000 Index or the S&P 500 Index. FCLKX advisors generally invest in issues of both domestic and foreign companies.

Matthew W. Fruhan has been the lead manager of FCLKX since May 25, 2017. Most of the fund’s exposure was in companies like Microsoft (6.2%), Wells Fargo (5.8%) and NVIDIA (5.1%) as of Oct. 31, 2024.

FCLKX’s three-year and five-year annualized returns are 15.3% and 18.7%, respectively. FCLKX has an annual expense ratio of 0.45%.

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