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Fidelity to launch four tracker funds

Company will add to its range of passive equity funds next month.

Fidelity Worldwide Investments is adding four trackers to its range of passive equity funds.

In March Fidelity will launch European excluding UK, Japan, emerging market and Pacific excluding Japan tracker funds following MSCI indices. It already offers UK, global and US passive funds. 

The trackers will be aimed at advisers through the Fidelity FundsNetwork platform. A number of wealth managers will also be able to access the funds. 

Ongoing charges will be 0.16 per cent for the European ex-UK fund; 0.27 per cent for the emerging market fund; 0.15 for the Japan fund; and 0.2 per cent for the Pacific ex-Japan fund. 

The funds will be managed by US-based Geode Capital Management.

Fidelity Worldwide Investment head of UK retail sales Ben Waterhouse says: “Whilst active management remains at the core of Fidelity’s investment philosophy, we are pleased to be able to meet the growing demand for index funds by bringing Geode’s proven passive capability to the UK market.”

Chase de Vere head of communications Patrick Connolly says passive funds are becoming “increasingly important” in the post-RDR world.

He says: “Investors are becoming more aware of the costs they are paying for active funds and are not prepared to put up with underperformance.

“Trackers are pretty easy to set up and very scalable, but the margins are low so Fidelity would have to get to a reasonable fund size in order to make it profitable.”

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