Portfolio Management
You don’t have to be following the markets to know that the price of gas have been dropping significantly. While this movement has made some companies in the energy industry unable to outrun the bear, the low gas prices has been friendly to the transportation industry.
The transportation companies that have been benefiting from the favorable gas prices range from shipping companies like United Parcel Service (UPS) to railroad companies like CSX Corporation (CSX) to the airlines.
This week, we will be focusing on this sector by taking a look at the Fidelity Select Transportation fund (FSRFX) – our fund of the week for November 5.
Inside the Fund
The Fidelity Select Transportation fund was launched in 1986 and is managed by Matthew Moulis. The fund currently has approximately $800 million in assets under management (AUM).
The fund is almost entirely invested in the Industrials industry. It is also heavily investment – with less than 3% of its total assets in cash.
Historical Performance
| 2010 | 2011 | 2012 | 2013 | YTD |
|---|---|---|---|---|
| 41.30% | -5.28% | 11.10% | 48.35% | 22% |
Fidelity Select Transportation Fund’s Largest Holdings
Nearly half of the fund’s portfolio is composed of its top five holdings. This has been favorable for the fund since each of its top holdings is up at least 10% in the last three months.
| Symbol | Stock | Portfolio Weight | 3 Month Performance |
|---|---|---|---|
| UNP | Union Pacific | 18.96% | +17.47% |
| UPS | United Parcel Service | 12.52% | +10.48% |
| FDX | FexEx | 6.07% | +12.52% |
| DAL | Delta Airlines | 5.88% | +12.85% |
| CSX | CSX Corporation | 5.72% | +17.53% |
The Bottom Line
This fund is a great way for investors to gain exposure to the booming transportation industry as it benefits from lower gas prices. By purchasing a mutual fund like this one, investors are able to gain exposure to the industry while remaining diversified.
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