Bonds and commodities are favoured asset classes during periods of stagflation

London, 14 April 2008 – Trevor Greetham, manager of the £39 million* Fidelity Multi-Asset Strategic Fund, remains overweight in commodities, bonds and cash amid the continued uncertainty on world markets.

The macro-economic indicators continue to point to weak global growth and rising inflation – a combination known as “stagflation”. Greetham believes this explains the odd spectacle of commodities and bonds doing well in the first quarter of 2008 while equities slumped.

He comments: “The new quarter is starting off on a strong note for stocks but bear market rallies are often short-lived. I remain underweight equities and property with the overweight distributed across commodities, bonds and cash. Sector exposure is tilted away from financials.

“However, it can only be a matter of time before slower global growth leads to weaker commodity prices and a return to the reflationary phase of the economic cycle. At that point, I am likely to shift the underweight focus of my equity holdings to industrials.”

Launched in January 2007, the Fidelity Investment Funds Multi Asset Strategic Fund aims to provide moderate long-term capital growth by investing in a range of global assets providing exposure to bonds, equities, commodities, property and cash. During the first quarter of 2008, the fund returned -1.91% compared with a benchmark return of -2.84%**.

The Fund Manager uses the Investment Clock model to determine an appropriate weighting in each asset class relative to the fund’s strategic benchmark. These assets are then allocated to other Fidelity portfolio managers who specialise within the various investment disciplines, with the exception of the exposure to commodities, which is achieved through investment in third-party contracts.

FIL Limited (“FIL”) and its subsidiary companies serve the major markets of the world by providing investment products and services to individuals and institutional investors outside the US. FIL Limited manages a total of £150.9 billion of assets**. Notes to editors:
_{*Source: Fidelity as at 31.03.08
**Source of performance: Morningstar. Basis: bid-bid with net income reinvested. Annualised growth rates, total return, sector median performance and ranks – Data Source: © 2007 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not
warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.
The fund’s benchmark is made up as follows: 10% DJ AIG Commodity Ind TR; 15% FTSE All Share; 10% 7 day GBP Libid; 40% ML Sterling Large Cap; 20% MSCI AC World Ind and 5% FTSE EPRA/NAREIT Gbl
***Source: Fidelity as at 31.12.07
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