Fidelity Puritan FPURX is a straightforward balanced fund that benefits from robust research. Increased confidence in the strategy’s resources and its lead manager, who continues to build a record of thoughtful decision-making here, underscores a People Rating upgrade to Above Average. The Morningstar Analyst Rating on all share classes moves to Bronze from Neutral. Lead manager Dan Kelley engages with broad firm resources—security analysts, quant researchers, sector specialists, economists, and investment committee members—and, depending on where he perceives the most attractive relative value propositions, he allocates broadly between stocks and bonds (the neutral weight is 60% equity and 40% fixed income). The equity component is run by Kelley, who looks for growth-leaning companies that are reasonably priced. The fixed-income component is run by two teams with deep sector expertise. Harley Lank and Alex Karam helm a high-yield-focused sleeve, and Michael Plage and Jeff Moore run an intermediate core bond sleeve. The portfolio’s contours have remained relatively consistent on Kelley’s watch. Equities ranged from 63% to 71% since he took the helm here in mid-2018 through March 2022, with the vast majority in U.S. domestic stocks; non-U.S. equities have occupied roughly 2%-6% of the portfolio over that time frame. As of March 2022, equities represented 68% of the portfolio and bonds 31% (roughly one fifth of the fixed-income portfolio was in below-investment-grade fare). Cash sat at 1%. Over Kelley’s tenure on this strategy (July 2018-May 2022), the K shares generated a 9.6% annualized return that outstepped the 7.2% of the Morningstar US Moderate Target Allocation Index, the 8.9% of a balanced bogy that’s 60% S&P 500 and 40% Bloomberg U.S. Aggregate Bond Index, and the 6.6% average of the allocation–50% to 70% equity Morningstar Category. Notably, this strategy’s biases (growth leaning, overweight in equities, with a modestly flexible core-plus fixed-income sleeve) have been a tailwind in the past three calendar years. When markets turn more tempestuous, as they have in the year to date through May 2022, this strategy will struggle; it trailed 75% of category peers over that period.
Key Proprietary Morningstar Metrics for Fidelity Puritan
Morningstar Analyst Rating: Bronze Process Pillar: Average People Pillar: Above Average Parent Pillar: Above Average
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