Last checked at 15 Jun 2018 10:37
London, UK, 15 June 2018
Edison issues review on Fidelity China Special Situations (FCSS)
Fidelity China Special Situations (FCSS) provides exposure to a diversified, actively managed portfolio of Chinese equities. The manager takes a bottom-up approach to stock selection, focusing on the faster-growing consumer-orientated sectors of China's economy. FCSS's NAV returns have been strong over the last two years, although modestly lagging its MSCI China index benchmark. This is attributed to FCSS's tilt to small- and mid-cap stocks, which underperformed large-caps, partly due to passive capital flows into index funds. Over five years, FCSS has significantly outperformed the benchmark, as well as its open- and closed-ended peers. A new variable management fee structure, with a lower base level and no performance fee, will take effect from July 2018.
FCSS's share price discount to NAV including income has broadly stayed in a 10% to 15% range since October 2016. The current 12.9% discount compares with its 12.6%, 14.7% and 13.0% averages over one, three and five years, respectively. A 3.50p dividend has been proposed for FY18, equating to a 40.0% increase on FY17.
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