Trustnet Magazine Issue 21 September 2016 | Page 18

IN FOCUS

Fund

FIDELITY EMERGING MARKETS

The fund has underperformed in the rally this year, but tends to come into its own
in falling markets

60%

Fidelity - Emerging Markets (52.82%)
MSCI Emerging Markets (29.58%)

50%

IA Global Emerging Markets (26.57%)

40%
30%
20%
10%
0%

Jul 16

Jan 16

Jul 15

Jan 15

Jul 14

Jan 14

Jul 13

Jan 13

Jul 12

Jan 12

-10%

Jul 11

MANAGER: Nick Price
FUND SIZE: £1.38bn
LAUNCHED: 22/03/2010
OCF: 1.07%
FE CROWN RATING:

in the top quartile in its sector
for suppressing annualised
volatility, maximum drawdown
(which measures the most money
investors would have lost if they
bought and sold the fund at the
worst possible moments) and
downside risk (which estimates its
ability to lose value during falling
markets). It also has a top quartile
Sharpe ratio, a measure of riskadjusted returns.
The research team at Square
Mile, who awarded the fund an “A”
rating, said: “Price aims to take
risks, primarily at the stock level,
in a measured manner and while
the mandate empowers him with
plenty of flexibility, we think he has
a strong innate sense of risk.”
“We see this fund as a solid
choice for investors seeking a
broad exposure to emerging
market equities.”

PERFORMANCE OF FUND VS SECTOR
AND INDEX SINCE LAUNCH

Jan 11

FILE

and a comfortable outperformance
of its sector average and the index
over three, it has struggled to
keep up with its peers over the
last year as well as over three and
six months, having fallen into the
bottom quartile over both of these
time frames.
However, those who are
familiar with the fund will know
that it performs particularly well
during falling markets, having
achieved top-quartile annualised
returns during the European
debt crisis in 2011 and the “taper
tantrum” in 2013. This capability
for capital preservation could
prove particularly useful with
the Federal Reserve expressing
renewed interest in raising rates.
The fund’s defensive nature
and the manager’s bottomup focus on quality stocks is
reflected in its risk metrics. It is

Jul 10

F

OLLOWING MORE
THAN THREE YEARS OF
UNDERPERFORMANCE,
the emerging markets sector
finally bottomed out in February.
However, aided by a number of
dovish statements from the Federal
Reserve and greater political
uncertainty in the developed world,
it has rebounded strongly since it
hit this point.
It has comfortably doubled the
gains of the FTSE 100 since 12
February and has delivered a third
more to investors than the S&P
500 and the Nikkei 225.
Active managers often find
it difficult to outperform their
benchmark in fast-rising markets
and this has proved to be the case
here, with a number of consistent
outperformers left in the shadows
over the past few months.
One of these is FE Alpha
Manager Nick Price’s Fidelity
Emerging Markets fund, which
has five FE Crowns and is £1.4bn
in size.
The fund has made 52.82 per
cent since launch in March 2010,
around double the gains of its IA
Emerging Markets sector and
MSCI Emerging Markets index.
While the fund also boasts a topquartile total return over five years

Source: FE Analytics

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