Rising interest rates created a bear market for bonds resulting in most bond mutual funds loosing value in 2013. Unfortunately, there are just not many good choices for income investors.
One of the few exceptions is high-yield corporate bonds and one of the best mutual funds available to participate in this trend is the Fidelity Capital and Income Fund (FAGIX).
Despite the name, FAGIX is not a growth and income fund, but a high-yield bond fund, based on the Morningstar classification. The 4.32% yield and the 7.01% year-to-date return sets FAGIX apart of most bond funds. We would continue to stay bullish on FAGIX, as long as the trendline (see blue line on chart) and the 50-day moving average holds.
Buy/sell signals for Fidelity funds are available at FidelitySignal.com