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Fidelity cuts Google stake by nearly a third amid shift to cheaper searches

(Reuters) - One of Google Inc (NASDAQ:GOOGL)'s largest investors has cut its exposure to the company by nearly a third over the past several months amid worries about a shift to cheaper searches on mobile phones.
The $107 billion Fidelity Contrafund cut its stake in Google to 5.2 percent of net assets as of Jan. 31, from 7.3 percent of net assets as of June 30.
"The firm continued to do phenomenally innovative things, but it is fighting a shift away from desktop search to less-expensive searches on mobile phones," Fidelity Investments portfolio manager Will Danoff said in Contrafund's annual report, released on Feb. 28th.
Danoff is considered one of the best stock pickers in the mutual fund industry, with Contrafund producing an average annual total return of 9.9 percent over the past 10 years. That's nearly 2 percentage points better than the benchmark S&P 500's average annual return of 7.99 percent during the same period, according to Morningstar Inc.
Still, in 2014, Google weighed down Contrafund's performance, along with a number of other large-cap funds with big positions in the stock. Danoff turned in one of his most disappointing performances of the past decade as Contrafund's 2014 total return of 9.56 percent lagged the S&P 500's 13.69 percent advance.
"In the strong-performing health care sector, I could have done a much better job with surging biotechnology stocks," Danoff said in the annual report for investors. "Notable mistakes included not owning enough Amgen (NASDAQ:AMGN), a biotech firm that made excellent advances, and avoiding index stock Allergan (NYSE:AGN), the specialty drug company that announced plans to be acquired by Actavis (NYSE:ACT)."

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