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Fidelity Advisor Limited Term Bond A FDIAX Fund Analysis

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Morningstar’s Analysis FDIAX

Will FDIAX outperform in future?

Get our overall rating based on a fundamental assessment of the pillars below.

  • Process Pillar

    The Process Pillar is our assessment of how sensible, clearly defined, and repeatable FDIAX’s performance objective and investment process is for both security selection and portfolio construction.

  • People Pillar

    The People Pillar is our evaluation of the FDIAX management team’s experience and ability. We find that high-quality management teams deliver superior performance relative to their benchmarks and/or peers.

  • Parent Pillar

    The Parent Pillar is our rating of FDIAX’s parent organization’s priorities and whether they’re in line with investors’ interests.

Changes to mandate and comanager addition at Fidelity Limited Term Bond; ratings unchanged

null Saraja Samant

Saraja Samant

Analyst Note

Effective Feb. 28, 2024, Fidelity Limited Term Bond Fund and Fidelity Limited Term Bond ETF will modify their investment strategies to allow each fund the ability to invest up to 20% of assets in non-investment-grade securities from their current 5% limit. The funds' internal composite benchmark (80% Bloomberg US 1-5 Year Credit Bond Index and 20% Bloomberg US 1-5 Year Government Bond Index), which defines their neutral allocations, will be modified to add a 10% high-yield component and reduce the investment-grade credit stake to 70%. Increasing the high-yield credit guardrails gives this team more flexibility but could result in slightly higher volatility compared with its historical risk profile. In response, the team is adding Alexandre Karam as a comanager for each of the funds to oversee the high-yield sleeve. With more than a decade of experience, Karam joined Fidelity in 2016 and is currently a portfolio manager on the firm’s high-income division. This mandate change and additional named comanager do not alter our view; both funds retain their Above Average People and Process ratings.

by Saraja Samant
Published on

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