Advertisement
Kip 25

Fidelity Contrafund: Big Companies, Huge Fund

Manager Will Danoff has an excellent record identifying underestimated companies. His success has attracted a lot of investor money.

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

Weighing in at $69 billion, Fidelity Contrafund is the biggest actively managed no-load fund. In charge is Will Danoff, a feisty, opinionated manager who invests wherever he sees fit. Since he took over in 1990, Contrafund has gained 16% annualized, beating Standard & Poor's 500-stock index by an average of four percentage points per year. Compared with rivals that invest in large, rapidly growing companies, the fund ranks in the top 10% of its category over the past 15 years.

Advertisement - Article continues below

Despite its name, Contrafund, which closed to new clients last April, does not focus on out-of-favor stocks. Rather, Danoff buys growth stocks that he thinks others are underestimating. Recently, his biggest positions included Apple Computer and Google -- hardly laggards. The fund also has 16% of its assets invested in midsize companies and 24% in foreign stocks, including recent top-ten positions in Mexican wireless-phone company America Movil and Swiss pharmaceutical firm Roche.

Danoff, who also runs Fidelity Advisor New Insights, a $7.6 billion load fund that is closed to new investors, is drawn to companies run by visionary executives. In fact, he likes to pay visits and chat on the phone with these executives -- sometimes, he'll have contact with as many as five companies in a day. Not surprisingly, Danoff says the secret to his success is keeping in close contact with the companies he invests in. Considering that the fund holds more than 400 names, that's a big job.

Advertisement - Article continues below

Contrafund held about $300 million when Danoff took the helm, $15 billion at the end of 1995, and $40 billion at the end of 2000. Between Contrafund and Advisor New Insights, Danoff currently manages nearly $77 billion. He has a great record, but given Contra's immensity, we suggest that shareholders HOLD their positions but not add to them.

 

FUND FACTS

 

Fidelity Contrafund (FCNTX)

Assets: $68.8 billion
Manager (year started): Will Danoff (1990)

Returns (vs. S&P 500)*
One year: 9.4% (13.8%)
Three years annualized: 14.4% (10.5%)
Five years annualized: 11.7% (5.6%)
Ten years annualized: 11.0% (8.4%)

Expense ratio: 0.88%
Portfolio turnover: 60%
Minimum investment: closed
Phone: 800-544-8544
Web site: www.fidelity.com

*Returns to January 3
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.

Advertisement
Advertisement

Most Popular

Medicare Basics: 11 Things You Need to Know
Medicare

Medicare Basics: 11 Things You Need to Know

There's Medicare Part A, Part B, Part D, medigap plans, Medicare Advantage plans and so on. We sort out the confusion about signing up for Medicare --…
September 16, 2020
Election 2020: Joe Biden's Tax Plans
taxes

Election 2020: Joe Biden's Tax Plans

With the economy in trouble, tax policy takes on added importance in the 2020 presidential election. So, let's take a look at what Joe Biden has said …
September 18, 2020
5 Unfortunate Estate Planning Myths You Probably Believe
estate planning

5 Unfortunate Estate Planning Myths You Probably Believe

These all-too-common misconceptions can steer your estate plans in the wrong direction right from the start. Here’s how to overcome them and tips to b…
September 17, 2020

Recommended

10 of the Best Target-Date Fund Families
mutual funds

10 of the Best Target-Date Fund Families

The best target-date funds are a 'set it and forget it' approach to your retirement, but which fund family should you trust your money?
September 17, 2020
Best Bond Funds for Every Need
Investing for Income

Best Bond Funds for Every Need

In a changing market, it’s important to remember why we hold bonds in the first place.
September 15, 2020
How to Build a Bond Portfolio
Becoming an Investor

How to Build a Bond Portfolio

No single bond (or even bond fund) can do it all. We'll help you match your goals with appropriate fixed-income picks.
August 27, 2020
Time to Buy Japanese Shares?
Foreign Stocks & Emerging Markets

Time to Buy Japanese Shares?

In a weak global economy, T. Rowe Price Japan finds firms with healthy balance sheets.
August 27, 2020