Fidelity has launched a new fund to capitalise on the opportunities created by “cheap and disliked stocks” in Europe.
The Fidelity funds European dynamic value fund, a Luxembourg-based Sicav which started trading yesterday, is managed by Neil Madden and will feature a concentrated portfolio of between 35 and 50 holdings.
Stocks examined by the fund will often be ones which have “major problems” and are being avoided by the market. These will be screened to identify any asymmetric return profiles, or where the bad news has already been priced in and there is significant upside potential.
“Once the market expects even a marginal improvement we believe the share price to move quickly, hence getting there early enables us to fully participate,” the asset manager says.
Madden has been at Fidelity for nine years, spending four as an equity analyst, three as assistant portfolio manager on the Fidelity Funds European growth fund and the remainder as portfolio manager of the pan-European equity element of Richard Skelt’s Fidelity International fund.