Factsheet: Fidelity China Special Situations Ord

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.

See all Money Observer rated funds
Name
Fidelity China Special Situations Ord
Manager
Fidelity (FIL Investments International)
Type
Closed Ended Investment Company
ISIN
GB00B62Z3C74
Sector
Country Specialists: Asia Pacific
Launched
19/04/2010
OCF
1.16 %
Risk Rating
5
3 Year Sharpe
0.70
3 Year Alpha
4.88
Yield
0.9 %
Benchmark
MSCI China GR USD
Fund Size
£ 1.41 billion
NAV
298
Gearing
123
Discount Premium
-14
To achieve long-term capital growth from an actively managed portfolio made up primarily of securities issued by companies listed in China or Hong Kong and Chinese companies listed elsewhere. The Company may also invest in listed companies with significant interests in China and Hong Kong.
Holding %
Tencent Holdings Ltd 10.04 %
Alibaba Group Holding Ltd ADR 9.79 %
Fil Usd Loan 3.01% 02/14/2020 6.70 %
Tencent Holdings LtdCFD 6.65 %
China Pacific Insurance (Group) Co Ltd HCFD 3.95 %
Hutchison China Meditech Ltd 3.51 %
58.com Inc ADR repr Class A 2.21 %
Hang Seng China Enterpise Indx_fut 1.93 %
China Petroleum & Chemical Corp H SharesCFD 1.92 %
Ctrip.com International Ltd ADR 1.90 %
Region %
Asia - Emerging 88.33 %
Asia - Developed 7.82 %
Sector %
Consumer Cyclical 31.48 %
Technology 23.61 %
Industrials 11.70 %
Consumer Defensive 11.31 %
Financial Services 7.98 %
Healthcare 7.74 %
Name
Fidelity (FIL Investments International)
Address
KT20 6RP, Tadworth, United Kingdom
UCITS
No
Legal Structure
Closed Ended Investment Company

Managers

Dale Nicholls
Joined 04/01/2014

Nicholls joined Fidelity in May 1996 as a research associate and was promoted to an analyst in January 1998. His current responsibilities are based in Pacific and Japanese equities funds. Nicholls is based in Tokyo.

Data provided by Morningstar.

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