06 June 2008: Fidelity International has extended the marketing of its Fidelity Active STrategy (FAST) funds, a family of specialist active extension portfolios, to professional investors across Europe following the funds’ conversion to UCITS III and completion of local market registration.
Thanks to their strong performances, the FAST Europe and FAST Japan funds have proved popular with many investors in the countries where they have been available through private placement. Conversion to UCITS III status, supported overwhelmingly by fund shareholders, allows Fidelity to offer these funds to a broader range of professional investors in more markets.
Since launch three and a half years ago, the €484 million FAST Europe Fund has delivered a return of 96.3%,* net of fees, compared with a return of 44.1% from its benchmark, the MSCI Europe Index. Over the same period, the JPY43 billion FAST Japan Fund has produced a return of 50.3%** compared with 35.6% from the MSCI Japan Index.
Like other actively managed Fidelity equity funds, the engine behind the performance of the FAST funds is the group’s stock research. But the managers of the FAST funds can also use derivative based leverage and synthetically short individual stocks, in order to pursue a more aggressive return for fund shareholders. In addition, they can invest up to 30% of the portfolio outside the benchmark on a gross long and short basis.
Alex Homan, Client Portfolio Manager says: “Fidelity’s equity research produces approximately as many sell recommendations as buys. In a conventional fund, the best that a manager can do with a sell recommendation is not to hold the stock. The FAST range of funds allows the managers to pursue the sell recommendation with far more conviction by going synthetically short – providing the opportunity to make money from a falling share price.
“Since their launch in October 2004, the FAST range has delivered superior returns for their investors. They are the most dynamic funds in the Fidelity family of funds – they’re our turbo-charged portfolios. We are now looking at expanding the FAST range, starting with a range of pilot funds including some with absolute return benchmarks.”
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. The FIL Organisation manages a total of £130.4/€167.1 billion of assets***
About the FAST products
The FAST family of funds are Active Extension funds that look to take additional long and short exposure around their relevant benchmark.
The FAST regional equity funds (FAST Europe, FAST Japan) are the most aggressive equity funds that Fidelity manages. They are structured to maximise sources of alpha that the portfolio managers can exploit with the aim of adding as much positive excess return to the core equity portfolio as possible. This is achieved through the minimisation of restrictions that prevent the manager from accessing his best ideas, be they in the form of regulatory constraint, benchmark constraint, asset class constraint or geographical constraint
Notes to editors:
* Source: FIL as at 31.05.08. Cumulative return. Performance quoted on a NAV to NAV basis with gross income reinvested.
**Source: FIL as at 31.05.08. Cumulative return. Performance quoted on a NAV to NAV basis with gross income reinvested.
*** Source FIL as at 31.03.08
