Large Price Drop of Fidelity Select Sector Funds is due to Capital Gains Distribution

The large price drop of several Fidelity mutual funds may have alarmed investors today. But it turns out that there is no reason to panic. The drop in the net asset value (NAV) of these funds was due to the annual distribution of capital gains, and also to a smaller extent, dividends.

Looking on the bright side, large distributions are reflective of large gains in 2013. Indeed, 2013 has been an exceptionally strong year for equities. Unless we experience an unexpected sell-off in the last 11 days of the year, 2013 will become the best year in equities, since 1999. Of course, this makes many investors fearful of downside volatility in 2014. But for now, lets focus our attention on closing the year, especially if it involves mutual fund investments that have produced excellent gains for investors.

So, lets take a look at examples of Fidelity funds with large price drops that are due to capital gains distributions:






More information:

  • Buy/sell signals for Fidelity funds are available at
  • Fidelity fund distributions: link