Trustnet Magazine Issue 15 February 2016

INVESTMENT STRATEGY The best performing of these is the Fidelity China Special Situations trust, which Dale Nicholls took over from industry stalwart Anthony Bolton in April 2014. Although it has lost 11.8 per cent over one year, it is up 25.57 per cent over three years and 12.43 per cent over five. Dampier says that with the trust sitting on a discount of close to 15 per cent, he could be tempted to buy in. CHINA THE NEW CHINA “Nicholls is buying into the new China story, not the old one,” he said. “For example, China now has the biggest e-commerce market in the world, meaning that while some areas are slowing, other areas are growing rapidly and it is these areas the Fidelity trust is buying into.” Amaya Assan, senior research analyst at Square Mile Investment Consulting and Research, adds that if investors are weighing up a passive or active approach, it is worth considering the fact that indices may reflect a distorted picture of the market. “For example, the Shanghai Composite index comprises all A & B shares listed on the Shanghai Stock Exchange, which significantly overweights the old players in the economy such as construction, which have slowed, while the consumer and services sectors are very much underweight.” So it would appear China is not the broken plate many of the headlines would like you to believe. It is an economy very much in transition and, long-term, there remain significant investment opportunities. New Year’s Revolution Annual platform fees as calculated by the lang cat, October 2015 Portfolio Size £25k £50k £100k £250k £500k £1m TRUSTNET DIRECT £308.50 £371 £446 £446 £446 £446 Alliance Trust Savings £523.50 £523.50 £523.50 £523.50 £523.50 £523.50 Barclays Stockbrokers £87.50 £175 £350 £875 £1,750 £1,750 Charles Stanley Direct £182.50 £245 £370 £745 £1,370 £2,120 Fidelity Personal Investing £87.50 £175 £350 £500 £1,000 £2,000 Hargreaves Lansdown £112.50 £225 £450 £1,125 £2,250 £4,000 £171 £246 £425 £990 £1,490 £1,740 £93.75 £187.50 £375 £937.50 £1,625 £2,750 TD Direct Investing Tilney Bestinvest THE LONG TERMER FIRST STATE GREATER CHINA GROWTH Returns have been difficult to generate over shorter time periods in China, so it makes sense to pay more attention to long-term performance. Martin Lau’s £360m First State Greater China Growth fund sits top of the tree in the IA China/Greater sector over 10 years, with gains of 204.7 per cent. The fund is also a first quartile performer over one year and second quartile over three years which has contributed to a four crown-rating from FE. Fiftysix per cent of AUM were invested in China as at the end of November, with another 28 per cent in Taiwan and 14.5 per cent in Hong Kong. The fund is soft-closed to new investment, however. THE INVESTMENT TRUST FIDELITY CHINA SPECIAL SITUATIONS After standing down as manager of Fidelity Special Situations and taking a brief retirement, Anthony Bolton stepped back into the limelight in April 2010 when he took charge of the newly launched 18 Fidelity China Special Situations trust. However, while Bolton’s enormously successful track record led many investors to pile into the vehicle, he had never managed in the region before and got off to a difficult start. By the time he handed over the reins to Dale Nicholls, though, he had beaten the benchmark and the trust is now up by more than 10 per cent over five years. THE GENERALIST HERMES GLOBAL EMERGING MARKETS With close to 26 per cent of the MSCI Emerging Markets index made up of China, all managers have to decide how and when to over- and underweight the market. Gary Greenberg, lead manager of the Hermes Global Emerging Markets fund, spent last year reducing his overweight stance. Having been heavily invested in the Chinese A-share market in 2014, he cut this last year from 1,000 basis points to 200 by the end of May. “By cutting our exposure it meant the portfolio was in a good shape to deal with, and not get hurt by, the market crash that followed,” he said. “Since the crash we have spent the last seven months watching things and are currently 3 per cent overweight China.” trustnetdirect.com Low cost High cost Source: the lang cat. Full report here If you make one resolution this year, make sure it’s to get better value from your investment platform. Switching to Trustnet Direct is a simple process that could save you literally £’000s, not just this year but every year. And you won’t be sacrificing any quality either. With all the data and more tools, research and planners than our sister site, FE Trustnet, you won’t be wanting for information. Open an account today at www.trustnetdirect.com and start saving. Trustnet Direct does not provide advice on the suitability of investments. It is an execution only service. The price and value of investments and their income fluctuates: you may get back less than you invested. Past performance is no guide to future performance. Trustnet Direct is a trading style of Trustnet Limited which is authorised and regulated by the Financial Conduct Authority

Trustnet Magazine Issue 15 February 2016 | Page 20