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A Flexible Fund Adept at Finding Income - FMSDX / by Lewis Braham in Barron’s

edited October 2021 in Fund Discussions
“Adam Kramer is used to finding value in unusual places. He grew up in Montreal with two favorite activities as a child—collecting hockey cards and reading Barron’s every week …

“His sharp eye for investing opportunities is especially critical now, when the landscape for fixed-income investing feels a bit like a minefield. Interest rates are almost zero. Some investors worry that recent economic-stimulus packages could spark a bond rout if higher inflation follows. (Interest rates rise with inflation, and bond prices move inversely to rates.) But a resurgence of Covid-19 cases could cause the opposite effect—another economic downturn, which would likely drive some lower credit-quality bond issuers into bankruptcy.

“In this environment, income-hungry investors need flexibility, and a willingness to go beyond bond-only investments. Fidelity Multi-Asset Income offers that. The $1.4 billion fund can invest anywhere for income—dividend-paying stocks, high- or low-quality corporate bonds, U.S. or foreign government bonds, preferred stocks, convertible bonds, real estate investment trusts (REITs), and master limited partnerships (MLPs). Such flexibility has produced strong results. The fund’s 16.7% three-year annualized return beats 99% of its peers in Morningstar’s Allocation—30% to 50% Equity fund category.”


Nice article. I note the fund appears to have 58% invested in equities - certainly not your typical “income” fund. And, its largest holding, WPM (Wheaton Precious Metals) just happens to be a stock I picked up a couple weeks back when it was mired in the weeds. I plan to hold it forever. I think that’s why Barron’s editors included the photo of Mr. Kramer in the weeds (searching for another bargain).


Excerpt from Barron’s, October 18, 2021 LINK


  • Interesting looking income focused fund. It has done especially well since the 2020 downturn. Here are it's recent stock %'s per M*.

  • edited October 2021
    Several posters commented on this fund on another tread. Quite a flexible allocation fund with good risk profile with respect to 2020’s drawdown and recovery time. Also it is more value oriented.
  • edited October 2021
    I put a big slug into it some time ago, much thanks to Bolin and others, and while I am not seeing that it notably improves on VONE + STIP 50-50 (or close proportion of your choosing), they do do a good job. ~300% turnover!
  • Several months ago, a poster on another forum made the following observation about FMSDX: "With value equities and junk fixed income be prepared to take a hit with this fund if the equity / credit markets turn south [...]"

    That was apparent yesterday when FMSDX lost 0.86%, that is more than the S&P 500 index lost. This may not be the "sleep well at night" type of fund for a conservative retiree in today's market environment. Time for me to reconsider and re-evaluate whether or not to keep this fund in my portfolio.

    Currently looking at WBALX, a balanced fund in M*'s 30-50%/conservative-allocation category with a lower standard deviation and somewhat lower equity exposure that lost only 0.17%. Total returns over the past 3 and 5 years have been in the 10 to 11% range, quite satisfactory in my neck of the woods.

    Good luck,

  • FPURX and JABAX might suit if not too gogo --- at the 50% equity bound at their low end range, which I suppose these days they never reach. Same LG nominal style as Weitz. FBALX too, and its style is nominally LB.
  • I don't think it makes sense even to consider removing a fund based on one day's performance. If you compare FMSDX with WBALX on PV it appears the two funds are highly correlated, with FMSDX just significantly better.
  • edited November 2021
    A bit OT - But relates to generating income …

    It’s a shame @Junkster doesn’t post any longer. Had a terrific amount of insight into junk bonds.
    Personally, I exited Price’s PRHYX (which is a good fund) more than a decade ago after they closed it - thinking it would stumble and I’d buy back in at a lower NAV after it reopened … Still waiting.
  • I have treated it as moderate-allocation, not conservative-allocation. I see that now M*, Fido, etc have also moved it from Allocation 30-50% (that was misclassification) to Allocation 50-70%.
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