Asset Drop Leads Fidelity to Reopen Funds
Fidelity Investments is inviting new money into an investment that not many people want right now: smaller stocks.
Fidelity said Wednesday it will reopen its Low-Priced Stock and Small Cap Stock funds to new investors. Both funds were closed in spring 1998 as assets surged--which turned out to be the peak for the small-stock market.
The Russell 2,000 small-stock index peaked last April 21 and is down 18% since. Many small-stock mutual funds have suffered not only from the decline of that market sector but also because disappointed investors have pulled money out.
Fidelity Low-Priced Stock fund’s assets have fallen to $7.8 billion from $12.1 billion since April. Assets of Fidelity Small Cap Stock fund have slumped to $490 million from $765 million since May.
Fidelity Low-Priced Stock fund gained 0.5% in 1998, compared with the 2.6% decline of the Russell 2,000. Fidelity Small Cap Stock fund was just launched in March 1998. So far this year, Low-Priced is down 5.8%, Small Cap is off 4.2%, and the Russell 2,000 is down 5.2%.