Fidelity will now manage £6bn in trusts
Kathleen Gallagher, 01 July 2021, Investment Week
Genesis Investment Management, which has run the fund for three decades, has stepped back from the trust as its investment approach “does not align well” with the board’s proposals to use derivates and leverage as well as their wish to focus on retail investors…
Pending shareholder approval, the investment company will transition to Fidelity in September and be renamed Fidelity Emerging Markets Limited.
This is Fidelity’s first new investment trust mandate since 2010, bringing Fidelity’s total AUM in trusts to £6bn.
Alex Denny, head of investment trusts at Fidelity International, told Investment Week that Fidelity had been keen to expand their range of equity trusts to include more regions, but did not believe they could launch into the space because there was already too much choice.
“It is easier to repurpose [and] take over underperforming trusts and improve them than it is to launch into this space,” he said.
As part of the change in management Fidelity will offer a reduced AMC of 0.6% of NAV, down from the current 0.9%, and has waived its fee for the first nine months following its appointment.
Nick Price, who runs several open-ended Emerging Market funds, will manage the trust. He will be supported by Chris Tennant…
Jayna Rana, investment company analyst at QuotedData, said: “This is great for Fidelity, who adds another mandate to its investment trust offerings as well as the trust and its shareholders.
“The board has made a good choice in an investment manager which has a strong global brand and solid emerging markets team while long-standing manager Nick Price, who launched the group’s first international emerging EMEA portfolio in 2005, has a decent track record having returned 275% since he first took on the Fidelity Emerging Europe Middle East & Africa fund. He also co-manages five other EM mandates.
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