Aim: Growth by investing globally in equities
Minimum investment: Lump sum £1,000, monthly £50
Investment split: 100% in global equities
Isa link: Yes
Pep transfers: Yes
Charges: Initial 3.5%, annual 1.5%
Commission: Initial 3%, renewal 0.5%
Tel: 0800 414181
Fidelity’s global special situations fund was formed from the division of Anthony Bolton’s Fidelity special situations fund. It will have an unconstrained approach, enabling it to invest in companies of any size anywhere in the world.
Bright Financial Services sales director Paul Breaks says: “The sun is always shining somewhere, says Fidelity, summing up the philosophy behind the launch of the global special situations fund. If there is an IFA out there who isn’t aware of what is occurring with Anthony Bolton and the special sits fund I wouldn’t want them looking after my affairs.”
Breaks points out that the £6bn special situations fund is to be split, with Bolton running both funds until Jan 2007, when Jorma Korhonen takes over the global special situations fund.
“The addition of the GSS fund takes Fidelity’s total number of special situations funds to six. It is a global equity fund, albeit with an adventurous brief. It can invest anywhere at any time, aiming to find the best special situations opportunities wherever they might be.”
Given Fidelity’s worldwide coverage and its experience of running special situations funds, Breaks anticipates the fund doing well in the long term.
“The UK now accounts for only 9 per cent of the worlds equity markets and only 36% of the FT-SE All Share companies income derives from the UK.,” says Breaks. He believes the fact that Bolton says a global special situations fund is the type of fund that he would launch today will also carry weight with IFAs.
With an initial charge of 3.5 per cent and an annual charge of 1.5 per cent, Breaks regards the fund as competitively priced.
Turning to the potential drawbacks of the fund Breaks says: “My only concern is that Korhonen was unknown before being elevated to be the fund manager. He has the unenviable task of following the most successful fund manager of the last 15 years. Korhonen has been at Fidelity 10 years, previously running the group’s Ibera, Italy and Switzerland funds. What is more important is that Bolton is personally recommending him as the ‘right man’ – and in 1979, who had heard of Anthony Bolton?”
In Breaks’ view, the competition is varied and includes Threadneedle global equity, Investec free enterprise, M & G basics and funds of funds. “There is, however, plenty of room for such funds as increasingly investors appreciate the international structure of what they currently perceive as domestic companies. The argument will become ‘why haven’t you got global fund exposure?’ as opposed to ‘why you should consider global fund exposure.”
Suitability to market: Good
Investment strategy: Good
Adviser remuneration: Average