Posted inHead To Head, News

HEAD-TO-HEAD: Axa versus Fidelity

FSA compares two global real estate products: the Axa Framlington Global Real Estate Securities Fund and the Fidelity Global Property Fund.
by Francis Nikolai Acosta

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Conclusion

The Axa fund receives a five-star Morningstar rating and an analyst rating of Bronze, while the Fidelity fund has a four-star rating and a Neutral analyst rating.

Morningstar’s star rating looks at historically risk-adjusted performance and the analyst rating is based on forward-looking analysis.

Van Genderen did not choose whether he prefers one fund over the other, but instead pointed to their analyst ratings.

“Given that the Axa fund has a higher rating, we have more conviction that the fund will beat the benchmark or its category over a full market cycle,” he said.

Van Genderen explained that what has dragged down the Fidelity fund’s rating is team turnover.

“Although the fund manager has a lot of experience in the real estate market, we have less conviction on the team given its high turnover, as well as the repeatability of the investment process,” he said.

That said, given that both products have different investment processes, they may be suitable for different kinds of investors, according to Van Genderen.

“The Axa fund is more diversified, so it can be considered as more of a core holding within investors’ global real estate market allocation.

“The Fidelity fund, meanwhile, may be more suitable for investors looking for more risk/reward and a more actively-managed portfolio.”

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