Editor's note: This is part of a continuing series of articles looking at the 20 biggest no-load stock funds.

With little fanfare, Fidelity's longest tenured fund manager, Joel Tillinghast, has compiled one of the best records in the business. During his 17-year reign at Fidelity Low-Priced Stock, the fund has returned a staggering 17% annualized. That beats Standard & Poor's 500-stock index by an average of seven percentage points a year and the small-company Russell 2000 by an average of six points a year.

As the name indicates, the fund, which is closed to new investors, invests primarily in low-priced stocks. Nowadays, that's defined as stocks that sell for less than $35. Shares of small and midsize companies still predominate, but as the fund has grown to gargantuan proportions (assets are nearing $40 billion), the value-conscious Tillinghast has had to own more names and invest in bigger companies. About 20% of the fund was recently invested in large companies, including Safeway, DR Horton, Pfizer, and Oracle. The sprawling, 800-stock portfolio is diversified throughout most sectors. Annual turnover is 26%, about two-thirds less than the average fund that focuses on midsize, undervalued companies.

Tillinghast has helped boost the fund's returns over the past few years by devoting an increasingly larger slice of the portfolio to foreign companies. Low-Priced Stock currently has nearly 30% of its assets in international stocks, up from about 13% at the end of 2001. Shares of Brazilian oil giant Petrobras, at last report the fund's biggest holding, gained 51% in 2006.

Low-Priced Stock is colossal for a fund that focuses on small and midsize companies. We're not dissing Tillinghast, whose record is terrific, but given the fund's mission and its heft, we rate Low-Priced Stock a HOLD.

FUND FACTS

Fidelity Low-Priced Stock (FLPSX) Assets: $39.5 billion Managers (year started): Joel Tillinghast (1989) Return (vs. S&P 500)*: One year: 14.4% (16.7%) Three years annualized: 16.2% (10.6%) Five years annualized: 16.2% (7.7%) Ten years annualized: 15.4% (7.9%) Expense ratio: 0.88% Portfolio turnover: 26% Minimum investment: closed Phone: 800-544-8544 Web site: www.fidelity.com *Returns through February 5 Fund Fact sources: Standard & Poor's, Morningstar

View updated data for this fund and compare the performance of the 20 biggest no-load stock funds.

Go to A Close Look at the 20 Biggest No-Load Stock Funds.

MORE: Kiplinger.com | Investing | Mutual Funds

TOOLS:   E-Mail Article  |  Print Article  |  Reprint Article  |  Content Licensing & Partnerships

E-MAIL ALERTS: Keep up-to-date with the latest Kiplinger has to offer

SAVE, SHARE & DISCUSS:    |   |   |   |   |    

ADD HEADLINES: