5
Morningstar FundInvestor
August 2
013
Morningstar Analyst Rating
07-31-13
Œ
Morningstar Pillars
Process
Performance
People
Parent
Price
¶
Positive
Positive
Positive
Neutral
Positive
Morningstar Analyst Rating
Morningstar evaluates mutual funds based on five key pillars, which
its analysts believe lead to funds that are more likely to outperform
over the long term on a risk-adjusted basis.
Analyst Rating Spectrum
Œ „ ´ˇ ¨
Pillar Spectrum
Positive
§
Negative
¶
Neutral
NAV
10.58
10.95
10.92
10.72
10.47
9.20
10.33
10.45
10.42
10.63
10.52
10.29
Total Return %
-1.90
6.51
7.40
8.55
19.80
-5.56
4.13
5.15
2.46
5.47
5.87
3.42*
*
+/-BC Agg Bnd
0.41
2.30
-0.44
2.01
13.87
-10.80
-2.84
0.82
0.03
1.13
1.77
.
+/-Barcap 5-10 Yr Gov
1.43
-0.70
-3.39
-0.87
13.30
-10.62
-3.42
1.34
0.63
0.17
-0.10
.
Income Return %
1.51
2.97
3.82
4.15
5.34
5.03
5.07
4.62
4.10
3.52
3.02
.
Capital Return %
-3.41
3.54
3.58
4.40
14.46
-10.59
-0.94
0.53
-1.64
1.95
2.85
.
Total Rtn % Rank Cat
36
53
18
29
15
57
73
13
16
7
26
.
Income $
0.16
0.32
0.40
0.42
0.48
0.51
0.52
0.47
0.43
0.36
0.31
0.05
Capital Gains $
0.00
0.36
0.18
0.21
0.03
0.07
0.03
0.02
0.04
0.09
0.06
0.00
Expense Ratio %
.
0.45
0.45
0.45
0.45
0.45
0.45
0.45
0.61
0.65
0.65
.
Income Ratio %
.
3.29
3.89
4.37
5.52
5.12
5.25
4.95
3.87
3.25
2.77
.
Turnover Rate %
.
155
168
130
104
122
116
99
193
.
336
.
Net Assets $mil
11,864
12,894
11,937
10,956
11,443
8,280
9,221
3,003
497
366
300
45
Performance
07-31-13
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
Total
2009
2010
2011
2012
2013
2.38 7.71
6.68 1.83 19.80
2.55 2.76
3.29 -0.28
8.55
1.08 2.18
2.16 1.78
7.40
1.26 2.20
2.33 0.58
6.51
0.30 -2.50
. . .
Trailing
Total
+/- BC +/- Barcap %Rank Growth of
Return% Agg Bnd 5-10 Yr Gov
Cat
$10,000
3 Mo
6 Mo
1 Yr
3 Yr Avg
5 Yr Avg
10 Yr Avg
15 Yr Avg
-3.34 -0.17
1.52
41 9,666
-1.48 0.14
0.89
31 9,852
-0.69 1.22
1.37
49 9,931
4.45 1.26
-0.27
30 11,395
6.59 1.36
-0.28
29 13,759
5.45 0.56
-0.37
23 17,001
. . . . .
Tax Analysis
Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
3 Yr (estimated)
5 Yr (estimated)
10 Yr (estimated)
2.64
34
1.74
84
4.71
28
1.76
77
3.68
25
1.68
76
Potential Capital Gain Exposure: 1% of assets
Rating and Risk
Time Load-Adj
Morningstar
Morningstar
Morningstar
Period Return % Rtn vs Cat
Risk vs Cat
Risk-Adj Rating
1 Yr
-0.69
3 Yr
4.45
+Avg
Avg
5 Yr
6.59
+Avg
+Avg
10 Yr
5.45
+Avg
Avg
Incept
5.52
Other Measures
Standard Index
Best Fit Index
BC Agg Bnd
BC US Universal
Alpha
1.5
0.6
Beta
0.92
1.02
R-Squared
83
95
Standard Deviation
2.86
Mean
4.45
Sharpe Ratio
1.51
Morningstar’s Take
by Sarah Bush 07-31-13
Fidelity Total Bond is a keeper.
One of several Fidelity entrants in the
intermediate-term bond category, this fund shares
many strengths with its siblings. For starters, it boasts
an experienced investment team, anchored here by
eight-year veteran manager Ford O’Neil. The fund’s
risk-conscious and valuation-sensitive strategy will
also look familiar as will its cheap price tag.
Where this fund distinguishes itself is in its
relatively wide-ranging mandate. O’Neil has the
flexibility to invest up to 20% in the so-called "plus"
sectors (that don’t appear in the Barclays U.S.
Aggregate Index) of high-yield, emerging-markets debt
and floating-rate bank loans. But while the fund’s
adventurous ways can leave it exposed when credit
markets sell off--the fund fell 5.6% in 2008--O’Neil has
generally made good use of this flexibility. The fund
came roaring back in 2009, after O’Neil built up a
combined stake in battered emerging-markets and
high-yield debt to near the portfolio’s 20% limit. He
had trimmed this position to 12%-14% of assets by
mid-2011, a move that helped the fund weather that
year’s turbulent third quarter, as did an overweighting
to the 30-year Treasury.
After spending the latter part of 2012 in a relatively
cautious stance, O’Neil has recently taken a more
aggressive tack. As of June 2013, the fund dedicated a
third of the portfolio to corporates, up from roughly
25% in fall 2012; O’Neil noted that he took advantage
of the June 2013 sell-off to buy junk bonds (12%).
That, together with 4% in emerging markets, left it
with a 16% plus stake, relatively high by historical
standards. After carrying a high double-digit position
in mortgages earlier in the year, he recently increased
exposure there, which stood at 27% as of June.
It isn’t invincible. It lost 1.8% for the year to date
through late July 2013 despite some well-timed
adjustments to the mortgage portfolio and a decision
to unload its Treasury Inflation-Protected Securities
stake. However, its 5.3% annualized return under
O’Neil’s tenure outpaces 70% of its peers’, and it
remains a top choice.
Address:
Fidelity Income Fund
Boston, MA 02109
800-544-8544
Web Address:
advisor.fidelity.com
Inception:
10-15-02
Advisor:
Fidelity Management & Research Company
Subadvisor:
FMR Co., Inc. (FMRC)
NTF Plans:
Fidelity Retail-NTF, CommonWealth NTF
Minimum Purchase:
$2500
Add: $0 IRA: $2500
Min Auto Inv Plan:
$2500
Add:
.
Sales Fees:
No-load
Management Fee:
0.20%
Actual Fees:
Mgt:0.32% Dist:
.
Expense Projections:
3Yr:$144
5Yr:$252 10Yr:$567
Income Distribution:
Monthly
Data through July 31, 2013
Fidelity Total Bond
Ticker Status Yield SEC Yield Total Assets Mstar Category
FTBFX Open 2.6% 2.73% $12,793 mil
Intermediate-Term Bond
46
38
29
37
36
38
33
47
39
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 07-13
Historical Profile
Return
Risk
Rating
Above Avg
Average
Above Avg
Investment Style
Fixed Income
Income Rtn %Rank Cat
Manager Change
Partial Manager Change
Growth of $10,000
Investment Values of
Fund
Investment Values of
BC Agg Bnd
Performance Quartile
(within Category)
History
10.0
12.0
14.0
16.0
18.0
Portfolio Analysis
06-30-13
Date of
Amount
Value % Net
Total Fixed-Income:963
Maturity
$000
$000 Assets
US Treasury Note 1.375%
05-31-20 576,425 555,890 4.62
Fannie Mae 3% 30 Year
547,937 535,590 4.45
Fannie Mae 3.5% 30 Year
449,457 453,807 3.77
Fidelity Cent Invt Portf
3,823 404,865 3.36
US Treasury Note 1%
05-31-18 408,858 401,671 3.34
US Treasury Note 2.375%
02-28-15 374,922 387,839 3.22
US Treasury Note 2%
02-15-23 325,698 313,205 2.60
US Treasury Note 1.75%
05-31-16 263,340 271,569 2.26
Fannie Mae 4% 30 Year
247,019 257,606 2.14
US Treasury Bond 3.125%
02-15-43 268,625 251,081 2.09
US Treasury Note 0.25%
08-15-15 227,529 226,694 1.88
US Treasury Note 0.875%
04-30-17 203,188 202,125 1.68
US Treasury Note 0.875%
01-31-18 192,574 189,069 1.57
Fannie Mae 4.5% 30 Year
171,144 181,992 1.51
US Treasury Note 0.125%
04-30-15 150,334 149,747 1.24
GNMA 3.5%
140,041 143,733 1.19
GNMA 4.5%
129,454 138,613 1.15
GNMA 5%
08-15-33 121,745 132,262 1.10
Freddie Mac 3.5% 30 Year
128,667 130,353 1.08
FHLB 4.5%
119,354 126,480 1.05
Current Investment Style
1
1
Avg Eff Duration
5.4 Yrs
Avg Eff Maturity
.
Avg Credit Quality
BBB
Avg Wtd Coupon
3.66%
Avg Wtd Price
102.59% of par
figure provided
by fund
Duration
Ltd Mod Ext
Quality
High
Med Low
Special Securities
Restricted/Illiquid Secs
6
Exotic Mortgage-Backed
0
Emerging-Markets Secs
4
Options/Futures/Warrants
No
Credit Analysis
% bonds 06-30-13
AAA
58
AA
3
A
11
BBB
17
BB
5
B
5
Below B 1
NR/NA 1
Sector Breakdown
% of assets
US Treasury
28
Non US Government
2
Government Related
4
Corporate
29
Agency MBS Pass-Through 18
Agency MBS ARM
0
Agency MBS CMO
3
Non-Agency Residential MBS 2
Commercial MBS
4
Asset-Backed
1
Municipal
2
Cash & Equivalents
7
Other
0
Composition - Net
Cash
6.3
Bonds 90.2
Stocks 0.0
Other
3.4
Coupon Range
% of Bonds Rel Cat
1.00=Category Average
0% PIK
0.1 0.0
0% to 6%
88.7 1.1
6% to 8%
10.0 0.8
8% to 10%
0.9 0.3
More than 10%
0.3 0.5
©
2013Morningstar, Inc.All rights reserved. The information herein isnot representedorwarranted tobe accurate, correct, complete or
timely. Pastperformance is no guarantee of future results.Access updated reports at
To order reprints, call 312-696-6100.
mfb.morningstar.com.
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