Last checked at 25 Jan 2019 14:25
London, UK, 25 January 2019
Edison issues review on Fidelity China Special Situations (FCSS)
Fidelity China Special Situations (FCSS) had a challenging year in 2018, heavily influenced by the correction in Chinese equities that was longer and deeper than in other major stock markets. However, the trust's longer-term returns have been strong, with an impressive 14.0% annualised NAV total return over five years, which is well ahead of its benchmark MSCI China index, as well as the MSCI World and FTSE All-Share indices. The market fall created compelling opportunities for manager Dale Nicholls, who added to holdings in high-quality companies that were trading at historically low valuations. The manager is optimistic about the long-term outlook, but he anticipates that volatility may persist and cut net market gearing from c 23% to c 18% in December 2018, mainly via index hedges.
FCSS's current 11.9% share price discount to NAV (including income) is towards the narrow end of its 9.7% to 20.0% three-year range and compares with its 12.1%, 13.9% and 13.4% averages over one, three and five years respectively.
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