Fidelity Global Enhanced Income Fund W GBP Acc

Global Equity Income

Rated Fund 2019-20. Accelerates income through the use of derivatives

Fidelity Global Enhanced Income was added to our line-up for 2019 for investors seeking stable and higher-than-average income from stocks globally. It is a sister fund to Fidelity Global Dividend, a Rated Fund since 2015. The two funds have the same number of holdings and are identical but for one key difference: the Enhanced Income fund uses derivatives to accelerate income generation.

Dan Roberts has run both portfolios since inception – this fund was launched in October 2013. David Jehan adds a derivatives overlay via covered call options to the Enhanced fund to give income a boost. At the end of 2019 the portfolio owned 49 stocks and had call options on 41 of them. This means the managers give up some potential capital growth from the shares in exchange for higher income. The fund has underperformed its sister by a small margin over five years but has historically yielded a great deal more. The current yield, at 4.6%, is double that of its sister.

Roberts invests in transparent and sustainable businesses anywhere around the globe. He will avoid some countries or sectors altogether if he doesn’t think the right opportunities can be found there. Companies have to offer a margin of safety for him to consider them for inclusion in the portfolio. The value influence in his process means he is less likely to overpay for a stock, which can help protect against price falls in down markets.

FundCalibre, the fund ratings and research provider, rates Roberts “very highly”. Managing director Darius McDermott says: “We like the fact that Dan challenges his analysts and allows intellectual debate.”

Narrative and ratings content all as of 1 January 2020.

See all Money Observer rated funds
Name
Fidelity Global Enhanced Income Fund W GBP Acc
Manager
FIL Investment Services (UK) Ltd
Type
Open Ended Investment Company
ISIN
GB00BD1NLL62
Sector
Global Equity Income
Launched
02/10/2013
OCF
0.94 %
Risk Rating
1
3 Year Sharpe
0.55
3 Year Alpha
2.49
Yield
3.9 %
Benchmark
MSCI ACWI NR USD
The Fund aims to increase the value of your investment and deliver an income that is at least 50% more than the income produced by the companies included in the MSCI All Country World Index. The Fund will invest at least 50% in equities (and their related securities) of companies globally, which could include countries considered to be emerging markets as determined by the Investment Manager at its sole discretion. Derivatives, including covered call options, will be used for investment purposes in order to further enhance the income generated by the underlying investments. The Investment Manager is not restricted in terms of size, industry, or geographical split. The Fund is actively managed without reference to a benchmark.
Holding %
Deutsche Boerse AG 4.18 %
Cisco Systems Inc 4.16 %
Unilever PLC 4.05 %
Roche Holding AG Dividend Right Cert. 3.95 %
Taiwan Semiconductor Manufacturing Co Ltd 3.82 %
Wolters Kluwer NV 3.52 %
Pfizer Inc 3.27 %
RELX PLC 3.26 %
Intel Corp 3.21 %
Schneider Electric SE 2.96 %
Region %
United States 31.90 %
Eurozone 25.90 %
United Kingdom 20.50 %
Europe - ex Euro 7.64 %
Japan 6.18 %
Asia - Developed 5.91 %
Sector %
Technology 18.58 %
Financial Services 18.53 %
Communication Services 14.30 %
Consumer Defensive 14.25 %
Healthcare 13.56 %
Utilities 9.58 %
Industrials 8.15 %
Name
FIL Investment Services (UK) Ltd
Address
TN11 9DZ, Hildenborough, United Kingdom
UCITS
Yes
Legal Structure
Open Ended Investment Company

Managers

Dan Roberts
Joined 10/02/2013

Dan C. Roberts is an Executive Managing Director, Head of the Global Fixed Income Group and its Chief Investment Officer. His responsibilities include spearheading macro-economic research, managing portfolios that utilize asset allocation and chairing GFI’s Investment Policy Committee (IPC). Directing the IPC is Dan’s most important investment responsibility as this Committee is the foundation of the GFI team-based approach to managing portfolios. It sets all portfolio strategy within the context of the team’s macro view and monitors compliance with its decisions. No significant positions are taken in any portfolio without the approval of the IPC. The IPC’s voting members are GFI’s four most senior investment professionals, who have worked together for nearly two decades. Dan joined MacKay Shields in 2004 when the firm acquired the fixed income business of Pareto Partners, where he had served as Chief Investment Officer. Dan first began assembling his team in 1989, when he was appointed head of fixed income at UBS Asset Management. In 1997 the team joined Forstmann-Leff International and was subsequently purchased by Pareto Partners in 2000. Prior to UBS, Dan worked at Chase Manhattan Bank, initially as a Financial Economist before being named head of Global Interest Rate and Currency Swaps Trading. Before joining the private sector, Dan served at The White House with the President’s Council of Economic Advisors from 1981 to 1983, was the Chief of Staff of the U.S. Congress’ Joint Economic Committee from 1984 to 1985 and was an economist at the U.S. Securities and Exchange Commission from 1977 to 1978. Dan holds a BBA and a PhD from University of Iowa. He has been working in the investment industry since 1977.

Data provided by Morningstar.

The Content is only for your general information and use and is not intended to address your particular requirements. The Content does not constitute any form of advice, recommendation or arrangement by Money Observer and is not intended to be relied upon by you in making (or refraining from making) any specific investment or other decisions. Appropriate independent advice should be obtained before making any such decision.

This information is sourced from our partner Morningstar. We believe the data to be correct however you should take care in using any information.

You should be aware that prices may fall as well as rise and that the income derived can go down as well as up. When buying or selling any investment that fluctuates in price or value you may get back less than you invested. Past performance is not necessarily a guide to future performance.