When other investors start to lose interest in certain stocks, Fidelity International Growth Fund (FIGFX) manager Jed Weiss says, "my ears perk up." He favors firms with good long-term growth prospects, attractive stock prices and solid moats around their businesses.
Over the past three, five and 10 years, he has outpaced his peers (foreign large-company growth funds) and the fund's benchmark, the MSCI EAFE Growth Index.
But in recent years, FIGFX – a member of the Kiplinger 25, our favorite no-load mutual funds – has not kept pace with the broader MSCI EAFE Index, which includes growth and value stocks.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Over the past 12 months, the fund's 11.8% gain has lagged the EAFE index's 17.7% rise. The primary reason: Bank stocks make up 24% of the index, and they have performed well since interest rates around the world have climbed from near-zero levels.
The Fidelity International Growth owns some financial services stocks, but there's a "big gap" in exposure to the sector between the fund and the EAFE index, says Weiss.
Even so, the fund's bright spots include German software company SAP (which has returned 52% over the past 12 months), French aerospace and defense company Safran (up 55%), and U.K.-based aerospace firm BAE Systems (up 60%).
Meanwhile, Weiss says, he "gobbled up great franchises on the cheap" during the April stock selloff. On top of adding to stakes in existing positions, he initiated positions in Belgian bank KBC Groupe and German ticketing firm CTS Eventim, among others.
Weiss's contrarian tilt has resulted in an above-average stake in U.K. stocks in recent years. Investors have ignored that market since Brexit, he says, and "a lot of shares in great global franchises are trading at valuations that you haven't seen for years."
Some British stocks that are newish to the fund include the London Stock Exchange, RELX, which owns the LexisNexis legal database, and Howden Joinery Group, a supplier of kitchen and joinery products (doors, cabinets, furniture) to builders.
This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.
Related Content
-
The Upscale Upgrades Coming to a Country Club Near YouYoung country club members expect more from their fees than access to a golf course. From teen rec rooms to red-light therapy, this is how clubs are upgrading.
-
I claimed Social Security six months ago at 62, but my checks are too small. What are my options?We asked financial experts for advice.
-
Five Retirement Planning Traps You Can't Afford to Fall Into, From a Wealth AdviserTo help ensure you reach your savings goals and enjoy financial security in your golden years, be aware of these common pitfalls. The key is to be proactive, informed and flexible.
-
Your 401(k) Can Now Include Alternative Assets, But Should It? A Financial Adviser Weighs InMany employer-sponsored plans offer limited investment options, which can stunt growth. But participants considering alternatives might need some sound advice to get the most from their accounts.
-
Will Taxes Shred Your 401(k) or IRA During Your Retirement? It's Very LikelyConventional wisdom dictates that you save in a 401(k) now and pay taxes later, but turning that rule on its head could leave you far better off. A financial planner explains why.
-
More Retirees Are Renting: Should You? A Financial Adviser Weighs InIn some ways, renting is cheaper, more flexible and easier, but unless you understand the implications for your taxes and health costs, it might not be for you.
-
Dow Dives 878 Points on Trump's China Warning: Stock Market TodayThe main indexes erased early gains after President Trump said China is becoming "hostile" and threatened to cancel a meeting with President Xi.
-
I'm a Real Estate Investing Pro: This 1031 Exchange Strategy Can Triple Your Cash FlowSavvy investors can use 1031 exchanges to unlock value by moving capital across markets in a play called geographic arbitrage. These tax implications can make or break the strategy.
-
I'm an Insurance Pro: Everyone Needs to Prepare for Earthquakes, Even if You Don't Live Near a Fault LineHere are my tips for what to do before, during and after an earthquake. The more prepared you are, the more you'll be able to keep your wits about you if it happens.
-
Stocks Retreat as Shutdown Continues: Stock Market TodayWhile the main indexes closed lower today, Delta and PepsiCo gained ground on encouraging earnings reports.
