UPDATE 1-Fidelity replaces manager of major stock fund

* Fund's assets down 2/3rds in 2008, Morningstar says

* Cohen has been demoted, analyst says

* New manager seen having a growth-style orientation (Adds analyst comments, byline)

By Muralikumar Anantharaman

BOSTON, Jan 13 (Reuters) - Fidelity Investments replaced Tim Cohen as manager of the $6.2 billion Growth & Income Portfolio, a stock fund that saw its returns halved last year due to disastrous bets on the financial sector.

James Catudal replaced Cohen as the fund's manager on Monday, Fidelity said on its website. Cohen, who ran the fund since October 2005, has taken on a new post as a research analyst for companies in the energy sector, Fidelity spokeswoman Sophie Launay said on Tuesday.

"That's clearly a demotion," said Christopher Davis, fund analyst at research firm Morningstar. "His tenure at Growth & Income was disastrous by any standard."

Catudal, who joined Fidelity in 1997 as an equity research analyst, will continue to manage the Advisor Growth & Income Fund, the VIP Growth & Income Portfolio and the Stock Selector Fund, Fidelity said.

"We believe the appointment is in the interests of the shareholders of the fund," Fidelity's Launay said. Catudal has an "excellent long-term record as a portfolio manager and his large-cap style of investing aligns well with the growth and income mandate of the fund," she said.