NEW YORK (MONEY Magazine) - Fidelity Magellan is the Coca-Cola of mutual funds. It has the name recognition, the marketing clout and the gargantuan size.

Investors have long had an emotional attachment to it, and it occupies an equally sentimental place in Fidelity's history; after all, the flagship fund, founded in 1963, was first managed by Fidelity's chairman Ned Johnson and, in its heyday, was run by Peter Lynch, whose remarkable record -- an average of 29 percent a year for 13 years -- trounced the market and pretty much everyone else.

But none of those things are helping Magellan today. Since Bob Stansky, a highly regarded Fidelity manager who is now 48 years old, took over as manager in June 1996, the fund has delivered an average annual return of 7.8 percent (through Feb. 20), according to Morningstar, trailing the S&P 500-stock index's 8.9 percent annualized return.

Last year the fund trailed the S&P by four percentage points -- that's not horrible (total return: 24.8 percent), but it's disappointing for investors expecting top-of-the-charts performance.

Indeed, ever since Lynch left in 1990, Magellan has been riding on its outsize reputation while producing lackluster results. On the basis of its 10-year return, Magellan ranks 14th among the 15 U.S. equity funds with assets of $20 billion or more, according to Lipper. For both the past five years and the past three, it ranks 13th.

What happened to this American icon? Is it simply going through a rough patch, or is there a more fundamental problem? And if you're one of the 5 million or so shareholders who have entrusted your retirement to Bob Stansky and Fidelity's worldwide crew of stock researchers, should you consider bailing out?

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