Fidelity China Special Situations fund

Rollinghome

Rainmaker_uk wrote: »

Sounds good? I thought so, which is why I invested in it.

Unlike the writer I don't have any vested interest in talking this share either up or down but for balance I think it would have been honest to mention that the NAV of this fund is up 12.76% and not 25%. The rest is due to a rise in the premium to 10.5% which irrespective of the underlying performance can realistically now only go one way. Premiums are generally good for sellers but bad news for buyers. Note that all other Fidelity ITs are currently selling at a discount of 10-15%.

For a crude comparison the NAV of the UT fund held by Reaper, First State Greater China Growth, is up 29.8% on the year and is still not the best performer in its sector. Only two funds in that IMA sector have returned less than 12% on the year.

So let's not add to the already voluminous hype or to the confusion in evaluating the performance of ITs. I'm a fan of many ITs but they are very different to UTs and investors shouldn't misunderstand what those numbers mean. Anyone wanting to invest in China should consider ITs, including that one, but be very wary of any selling at a premium rather than a discount.

jimjames

Only problem with this IT now is that it trades at a premium. I always avoid trusts at a premium unless there is an exceptional reason to do so. When other funds in the same region are at a discount or you can get an equivalent unit trust at NAV this doesn't seem the time to buy.

I had invested via the Fidelity IT Share plan but have stopped as I don't want to pay the peak.

To the OP, if you don't already have a balanced portfolio then in my view this is not one to invest in.

sabretoothtigger

was it ever at a discount

IronWolf

So, this fund has had a troubled time and is now at a discount but performance is improving.

Has Bolton learned from his mistakes? Personally I'm considering buying this, or alternatively the First State Greater China fund, which seems to have a good manager in charge as well.

Rollinghome

IronWolf wrote: »

Has Bolton learned from his mistakes? Personally I'm considering buying this, or alternatively the First State Greater China fund, which seems to have a good manager in charge as well.

Whether he's learned form his mistakes or not, this fund will always have the additional drag on performance of high costs - primarily because despite being an IT it charges investors an additional 0.5% pa in perpetuity to be paid to those such as Hargreaves Landown who gave it the hard sell for them.

You might have so much faith, even now, in Bolton's superior abilities to still consider it worthwhile. If so, you then have the problem of what happens when Bolton leaves, which can't be so far off, and the effect on the discount.

No doubt the Bolton fans will exit and, regardless of his abilities, they're likely to be right because it will be a signal that he doesn't expect better times ahead.

jimjames

Rollinghome wrote: »

You might have so much faith, even now, in Bolton's superior abilities to still consider it worthwhile. If so, you then have the problem of what happens when Bolton leaves, which can't be so far off, and the effect on the discount.

I understand that a statement has been issued that he has agreed to stay until 2014.
http://www.telegraph.co.uk/finance/personalfinance/investing/9217436/Fidelity-China-Special-Situations-fund-manager-Anthony-Bolton-has-been-shanghaied-in-China.html

As the fund is at a discount I've been adding to my holding. I'm interested to see the comment about the additional 0.5%, does that apply to all investors or just those that applied via IFAs?

Rollinghome

jimjames wrote: »

I understand that a statement has been issued that he has agreed to stay until 2014.
http://www.telegraph.co.uk/finance/personalfinance/investing/9217436/Fidelity-China-Special-Situations-fund-manager-Anthony-Bolton-has-been-shanghaied-in-China.html

As the fund is at a discount I've been adding to my holding. I'm interested to see the comment about the additional 0.5%, does that apply to all investors or just those that applied via IFAs?

It will always be paid and included in the charges. If it isn't paid to an intermediary for some reason it will be retained by Fidelity.

A discount is fine but more important is what happens to the discount in future.

Linton

I would much prefer the First State fund. First State have proven experience in the Far East with a range of good funds. I believe the strategy is more important than one person's stock picking skills and it remains to be seen whether Andrew Bolton's strategy that was so successful for Fidelity Special Situations is applicable to China.

In the past year the Fidelity fund has been outperformed by the First State fund by some 27%.

IronWolf

Unfortunately the First State is now soft capped, and I cant buy it through my ISA