London, UK, 10 February 2021
Edison issues review on Fidelity Special Values (FSV)
Fidelity Special Values (FSV) offers a value-based, contrarian investment approach aimed at achieving long-term capital growth through investment in overlooked and undervalued UK equities. Value investing has been out of favour for some years and the underperformance of UK value stocks worsened during last year's market sell-off. However, this created many opportunities which FSV's managers Alex Wright and Jonathan Winton sought to exploit and, with value stocks now returning to favour, their efforts are beginning to pay off. After a period of disappointing performance, particularly in Q120, FSV's returns have recently improved. The trust returned 24.7% in NAV terms in the three months to end January 2021, outperforming the UK market, which returned 16.5%. Despite the recent improvement in UK value stocks, they still offer value and there is scope for further upside if the improving economic outlook supports continued rotation into value stocks. FSV's managers believe the trust is well-positioned to take full advantage of this trend.
After trading mostly at a discount to NAV since the Q120 market sell-off, FSV's share price returned to a premium in late 2020, supported by improved performance and a recently announced fee reduction. It is presently trading at a premium of 2.2%. Based on its current share price, FSV's FY20 yield is 2.4%.
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