Fidelity China Special Situations PLC

Asia Equities

Rated Fund 2015-2018. Taps into rising consumer demand

This trust is one of only a couple that focus purely on China, a market that some people argue is too big to ignore. David Liddell, a director of IpsoFacto Investor, an online investment advisory service, says: 'For long-term investors who can take some volatility, China with its ever-expanding middle class is surely a must for some proportion of an investment portfolio.'This trust has been managed since 2014 by Dale Nicholls, who has presided over a considerable improvement in its performance. This is due partly to an improvement in investor sentiment towards China, and partly to Nicholls' focus on 'new' China investing in areas of the market related to China's modernisation. He looks particularly for small and medium-sized companies, where he believes lower levels of research leads to more mispricing opportunities.Much of the trust's portfolio is invested in businesses providing goods and services to the growing Chinese consumer market. 'The trust has been riding the growth of the service economy in China very successfully,' adds Liddell. However, Nicholls also looks for undervalued opportunities in state-owned enterprises or oversold parts of the market.Since 2016, Nicholls has been able to invest 10 per cent in unlisted companies, up from 5 per cent, amid a trend for Chinese companies to list on a public stock exchange after their development has progressed. This exposure, combined with gearing of 25 per cent, increases its risk profile. However, at the end of 2017, the trust had less than 3 per cent exposure to unlisteds. Shares in the trust can also typically be bought at a discount to net assets of more than 13 per cent.

Narrative and ratings content all as of 01 January 2018.

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Fidelity China Special Situations PLC
Fidelity Investment Services Ltd
Closed Ended Investment Company
Country Specialists: Asia Pacific
1.11 %
Risk Rating
3 Year Sharpe
3 Year Alpha
1.6 %
Fund Size
£ 1.09 billion
Discount Premium
The investment objective of the Company is to achieve long-term capital growth from an actively managed portfolio made up primarily of securities issued by companies listed in China and Chinese companies listed elsewhere. The Company may also invest in listed companies with significant interests in China.
Holding %
Alibaba Group Holding Ltd ADR 10.40 %
Tencent Holdings Ltd 9.08 %
Fil Usd Loan 3.01% 02/14/2020 8.26 %
Tencent Holdings LtdCFD 6.01 %
Hang Seng Index Options Sept. 27, 2018 Put 28400 3.88 %
China Pacific Insurance (Group) Co Ltd HCFD 3.59 %
Hutchison China Meditech Ltd 3.22 %
China Petroleum & Chemical Corp H SharesCFD 2.67 %
Hang Seng Index Options Sept. 27, 2018 Put 26600 2.55 %
China MeiDong Auto Holdings Ltd 2.36 %
Region %
Asia - Emerging 88.59 %
Asia - Developed 8.18 %
Sector %
Consumer Cyclical 31.14 %
Technology 21.50 %
Industrials 12.53 %
Consumer Defensive 11.08 %
Healthcare 9.34 %
Financial Services 9.00 %
Fidelity Investment Services Ltd
KT20 6RP, Tadworth, United Kingdom
Legal Structure
Closed Ended Investment Company


Dale Nicholls
Joined 04/01/2014

Dale Nicholls joined Fidelity in 1996 as a Research Associate in our Tokyo office. It was during his tenure as an analyst that Dale first began to take an interest in the dynamics of the Chinese market. He regularly visited Chinese companies to get a clear view of the key supply and demand chains of the industries he covered. In 2003, he was promoted to portfolio manager of the Fidelity Pacific Fund and retains management of that portfolio today. In his current role, Dale spends much of his time travelling within China to meet with the management teams and competitors of companies in which he may, or already does, invest, visiting well over 100 companies a year.

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