Fidelity Funds - Sustainable Emerging Markets Equity Fund W-Inc-GBP

Why we like the fund

Fund manager Alex Duffy builds upon his experience as an analysts and former co-manager of a Latin America fund to build a concentrated, quality growth-oriented portfolio of stocks for the long term. This strategy has been his sole focus since December 2014 and he is supported by a large and experienced emerging market equity research team. Investing in this strategy means investing in a concentrated selection of companies with high corporate governance standards that are both willing and able to share returns with their minority shareholders. This is a key element of his process, and it is particularly important in finding management teams that are incentivised to achieve sustainable outcomes for the business, making ESG and financial success one and the same.

How to use this fund

Given the investment process is very much focused on an absolute-return and avoidance of permanent loss of capital, an approach that makes sense in a high risk asset class like emeeging markets, this fund is a great option to get exposure to the best quality-growth ideas in the region with limited potential for downside. The manager’s focus on valuations, reinvestment opportunities and balance sheet strength means that investors in this strategy can also expect to have a relatively less volatile investment journey than with other quality-growth peers. However, the fund is benchmark agnostic, and as such can differ substantially from the underlying benchmark. To avoid suffering during periods when the value style is in vogue, this fund should be paired with a value option in emerging markets for a more balanced return pattern.