Transcript FAST – Global Strategy Additional α = Global Stock Picking

FAST – Global Fund
Dmitry Solomakhin
Portfolio Manager
May 2014
FAST – Equity fund range
Fidelity Active STrategy
UCITS SICAV
Long equity exposure*
FAST EQUITY
FUNDS
Short equity exposure*
FAST
Europe Fund
0%
100%
FAST
Japan Fund
0%
100%
FAST
UK Fund
0%
100%
FAST
Emerging
Markets Fund
0%
100%
FAST
European
Opportunities
Fund
0%
FAST
Asia Fund
0%
100%
100%
FAST
US Fund
0%
100%
FAST
Global Fund
0%
100%
Comparison indices and launch dates
MSCI
Europe
MSCI
Japan
FTSE
All Share
MSCI
EM
MSCI
Europe
MSCI AC Asia
ex Japan
S&P
500
MSCI
AC World
1 Oct 2004
1 Oct 2004
14 Mar 2011
31 Oct 2011
31 Jan 2012
31 Jan 2013
25 Jun 2013
30 Sep 2013
* Shaded areas highlight flexible nature of extensions.
Source: FIL Limited, 31 March 2014.
Holdings can vary from those in the index quoted. For this reason the comparison index is used for reference only.
2
FAST – Evolution timeline
Oct 2004
Jan 2007
Feb 2008
Apr 2009
Mar 2011
Jan 2012
Jan 2013
Sep 2013
FAST Europe &
FAST Japan
launched
Short extension
increased from
15% to 30%
UCITS
conversion
Daily liquidity
introduced
FAST UK
launched
FAST European
Opportunities
launched
FAST Asia
launched
FAST Global
launched
Apr 2006
Jun 2007
Jun 2008
Oct 2009
Oct 2011
Jan 2013
Jun 2013
Daily valuation
introduced
Opportunistic
hedging strategies
introduced
Enhanced
reporting
Capacity
management
programme
introduced for
FAST Europe
FAST Emerging
Markets
launched
Capacity
management
programme
re-introduced for
FAST Europe
FAST US
launched
8,000
FAST Aum ($m)
7,000
6,000
5,000
4,000
3,000
2,000
1,000
Sep 04
Dec 04
Mar 05
Jun 05
Sep 05
Dec 05
Mar 06
Jun 06
Sep 06
Dec 06
Mar 07
Jun 07
Sep 07
Dec 07
Mar 08
Jun 08
Sep 08
Dec 08
Mar 09
Jun 09
Sep 09
Dec 09
Mar 10
Jun 10
Sep 10
Dec 10
Mar 11
Jun 11
Sep 11
Dec 11
Mar 12
Jun 12
Sep 12
Dec 12
Mar 13
Jun 13
Sep 13
Dec 13
Mar 14
0
Source: FIL Limited as at 31 March 2014.
3
Dmitry Solomakhin
Portfolio Manager - FAST Global
Funds under management
FAST Global*
Jan 2012 – Present**
Experience at Fidelity
Fidelity Global Technology Fund
Nov 2008 – Oct 2013
Portfolio Manager Assistant, Global Equities
Jan 2008 – Nov 2008
Dmitry Solomakhin
Portfolio Manager
Based in: London
Years of investment
experience: 8
Research Analyst (European Aerospace & Defence; Airlines and Logistics)
2006 – 2008
Education:
MBA (Hons), INSEAD,
France
MSc (Hons), Applied
Mathematics & Computer
Sciences, Moscow State
University, Russia
Previous experience
IT Project Manager, Gillette
2002 – 2004
IT Project Manager, Nestle (Russia/Poland)
1999 – 2001
Source: FIL Limited. *Fund was not available for purchase by clients until Sept 2013, when it was launched officially. **The representative track record for FAST Global began in
January 2012 when it was run as an internal/pilot fund. Proof of concept phase from March 2011 to January 2012.
4
Global Equity Team
Global Equities
Global Diversified
United States
5
Portfolio Managers
17 Equity Research
Global Sector/Thematic
Amit Lodha
Global Focus/Real Assets
Aditya Shivram
Telecoms/Income
Emerging Markets
Dan Roberts
Global Dividend
Chris Moore
Industrials, Natural Res.
5
Dmitry Solomakhin
FAST Global
Dirk Philippa
Property Securities
Jeremy Podger
Global Special Situations
Hilary Natoff
Health Care/Demographics
Sudipto Banerji
Global Opportunities
HyunHo Sohn
Technology
Portfolio Managers
53 Equity Research*
Japan
9
Europe
Portfolio Managers
25 Equity Research
31 Portfolio Managers
42 Equity Research
Asia
25 Portfolio Managers
52 Equity Research
Nicky Stafford
Consumer/Demographics
Sotiris Boutsis
Financial Services
Shorting Analysts
Derivatives Team
Traders / PSG
Quant
5 Shorting Analysts
Find and analyse
shorting opportunities
5 Derivative Specialists
Advise and monitor use of
derivative instruments
Portfolio trading
and monitoring
3 Technical Strategists
Advise and monitor
technical/market indicators
Source: FIL Limited, 31 December 2013. *The number of Equity Research resources responsible for Emerging Markets coverage includes analysts with dual research coverage
which are also counted under the other regions listed in this graphic.
5
FAST – Global Strategy
 Active long and short extensions to maximise risk adjusted returns
 Unconstrained and benchmark unaware global equity fund
 Long term investment horizon, but with dynamic stock position management
 Fundamental bottom up stock selection drives high conviction, concentrated positions:
– Typically 60 - 110 stocks in total
– Long position sizes 1.0% - 5.0%
– Short position sizes 0.5% - 2.0%
 No exposure to illiquid or binary outcome stocks
Source: FIL Limited.
6
Long positions – what I look for
Recovery
Where normalised earnings are much higher than current earnings
Beat the Fade
Where the long term earnings power of the franchise is not appreciated by
the market
Special Situations
Where the market is using an inappropriate fundamental approach to
analyse the stock
Source: FIL Limited.
7
Short positions – looking for absolute downside
Structural shorts (~ 2/3 of the positions)
 Broken business models (usually in an
industry undergoing structural change)
 Weak balance sheet, poor management &
questionable track record
Common considerations
 Ownership structure
 Takeout probability
Tactical shorts (~ 1/3 of the positions)
 Shorter term in nature
 Specific catalyst
Source: FIL Limited.
8
 Sentiment, technical indicators,
short interest and borrow cost
Idea generation & validation
Investment Universe
c5,000 listed stocks worldwide
Idea Generation - both Long and Short
 Fidelity Research
 Global Sector PMs
 Meetings, conferences, trips
Idea Validation - both Long and Short
 Internal research
 Financial statements & annual reports
 Sell side and technical research
 Hypothesis challenges iteration
 Downside risk + stress test
Portfolio construction
Long Book
Source: FIL Limited.
9
Long / Short Book
Long position – Recovery
CME Group
Price
90
 Great quality franchise with very high
barriers to entry.
85
80
 Earnings currently depressed by a
variety of factors.
75
Price (USD)
 Strong management team with very
shareholder friendly approach.
70
65
60
55
*
45
CME Group
Stock/CFD:
Bought
Sold
Source: Datastream/FIL Limited, 31 March 2014.*Reduced on portfolio construction considerations
10
Performance shown might represent trade initially deployed in the FAST Global Pilot. For illustration
purposes only. Pilots are funded entirely by Fidelity and are not available for client investment.
Mar 2014
Jan 2014
Nov 2013
Sep 2013
Jul 2013
May 2013
Mar 2013
Jan 2013
Nov 2012
Sep 2012
Jul 2012
May 2012
Mar 2012
Jan 2012
Nov 2011
Sep 2011
Jul 2011
40
May 2011
 Core position in the fund.
50
Mar 2011
 Several important catalysts over the
next two years.
Long position – Special Situation
Price
 Indonesian bank with a strong
microfinance-focused business
model.
9900
 Micro underwriting acumen a key
differentiator and harder to replicate
than the market believes.
7900
5900
4900
Bank Rakyat
Stock/CFD:
Bought
Sold
Source: Datastream/FIL Limited, 31 March 2014.
11
Performance shown might represent trade initially deployed in the FAST Global Pilot. For illustration
purposes only. Pilots are funded entirely by Fidelity and are not available for client investment.
Mar 2014
Jan 2014
Nov 2013
Sep 2013
Jul 2013
May 2013
Mar 2013
Jan 2013
Nov 2012
Sep 2012
Jul 2012
May 2012
Mar 2012
Jan 2012
Nov 2011
Sep 2011
3900
Jul 2011
 Core position in the fund.
6900
May 2011
 Liquid and well capitalised B/S.
Price (Indo. Rup.)
 Enjoys sustainable high returns in a
country with low credit penetration.
8900
Mar 2011
Bank Rakyat
Bank Rakyat – Macro forces matter
Exchange Rate
Price to Book Relative
18000
2.6
16000
2.4
2.2
14000
2.0
1.8
Price to Book
Exchange Rate
12000
10000
8000
6000
1.6
1.4
1.2
1.0
4000
0.8
Indo. Rupiah to US Dollar
Source: Datastream, 31 March 2014.
12
Mar 04
Sep 04
Mar 05
Sep 05
Mar 06
Sep 06
Mar 07
Sep 07
Mar 08
Sep 08
Mar 09
Sep 09
Mar 10
Sep 10
Mar 11
Sep 11
Mar 12
Sep 12
Mar 13
Sep 13
Mar 14
Mar-14
Mar-12
Mar-10
Mar-08
Mar-06
Mar-04
Mar-02
Mar-00
0.4
Mar-98
0
Mar-96
0.6
Mar-94
2000
Bank Rakyat rel to MSCI AC World Index
Source: Bloomberg, Datastream 31 March 2014. End month data used.
Long Position – Special Situation
Serco Group
Price
700
 Leading outsourcing firm under
pressure from ongoing government
investigations.
650
450
400
Serco Group
Stock/CFD:
Bought
Sold
Source: Datastream/FIL Limited, 31 March 2014.
13
Performance shown might represent trade deployed in the FAST Global Pilot. For illustration purposes
only. Pilots are funded entirely by Fidelity and are not available for client investment.
Mar 2014
Jan 2014
Nov 2013
Sep 2013
Jul 2013
May 2013
Mar 2013
Jan 2013
Nov 2012
Sep 2012
Jul 2012
May 2012
Mar 2012
Jan 2012
Nov 2011
Sep 2011
350
Jul 2011
 Compelling valuations; stock
expected to re-rate once overhang
dissipates.
500
May 2011
 ROIC in excess of 15%.
550
Mar 2011
 Solid underlying business with high
earnings visibility, margin expansion
via improving mix and M&A .
Price (GBP)
600
Short position - Structural
BlackBerry
Price
18
 Handset hardware and software
vendor.
 Service revenues under pressure and
possibility of company becoming
irrelevant within next few years.
14
Price (USD)
 Initiated short position on
expectations that BlackBerry10
product cycle would disappoint.
16
12
10
8
6
BlackBerry
CFD:
Open Short
Close Short
Source: Datastream/FIL Limited, 31 March 2014.
14
Performance shown might represent trade deployed in the FAST Global Pilot. For illustration purposes
only. Pilots are funded entirely by Fidelity and are not available for client investment.
Mar 2014
Dec 2013
Sep 2013
Jun 2013
Mar 2013
Dec 2012
Sep 2012
Jun 2012
Mar 2012
 Closed short position on profit taking.
4
Dec 2011
 Added to short position on weak sell
through data.
Risk management
Portfolio level risk (Barra)
Portfolio level risk
 Statistical risk analysis including factor
exposures of the total fund and each ‘book’
2%
2%
 ‘Real’ risks at the portfolio level
10%
5%
9%
Stock level risk
72%
 Statistical risk analysis
 ‘Real’ risks at the stock level
Stock
Country
Industry
Risk Index
Currency
World Equity
 Additional risk control for short positions
– dynamic positioning & stop loss discipline
Source: FIL Limited, 31 March 2014. Comparative index = MSCI AC World. Data includes any derivative exposures as an economically equivalent position in the underlying asset.
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Exposure – total equity level - life of FAST Global
170
Pilot
Fund
150
130
Current positioning*
110
Long positions
(44 stocks)
113.0
Short positions
(25 stocks)
-18.6
Net equity exposure
94.4
Gross equity exposure
131.6
% TNA
90
70
% TNA
50
30
%
10
Active money
-10
Long
Short
Gross
4.0
Mar-14
Feb-14
Jan-14
Dec-13
Oct-13
Nov-13
Sep-13
Aug-13
Jul-13
Jun-13
May-13
Apr-13
Mar-13
Feb-13
Jan-13
Dec-12
Nov-12
Oct-12
Sep-12
Jul-12
Aug-12
Jun-12
May-12
Apr-12
Mar-12
Feb-12
Ex-ante tracking error
Jan-12
-30
112.8
Net
Source: FIL Limited, 31 March 2014. *After the aggregation of all investments, including derivatives on an exposure basis, linked to a particular issuing company or basket security
(e.g. index futures and options). The aggregate holding is referred to as a position. Chart data shows the net equity exposure of the FAST Global Pilot from January 2012 to
September 2013 and the live fund thereafter.
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FAST Global – Performance vs. comparative index &
peers
97% of peers beaten on performance
94% of peers beaten on IR at 1.13*
Performance vs. comparative index and peer group
Risk/return vs comparative index and peer group
170
100
+60.7%
160
150
+44.2%
+39.3%
140
130
120
Cumulative return (%)
80
FAST Global
Composite
60
MSCI ACWI
40
Sector Average
20
110
Pilot
Fund
0
100
90
FAST Global
MSCI ACWI (N)
Mar 14
Dec 13
Sep 13
Jun 13
Mar 13
Dec 12
Sep 12
Jun 12
Mar 12
Dec 11
-20
0
5
10
15
20
25
30
Annualised volatility (m) (%)
Sector Average
Source: FIL Limited, Morningstar Direct, nav-nav, gross income reinvested, in USD, 31 December 2011 to 31 March 2014 vs Morningstar Offshore Global Large-Cap Blend Equity category. While the FAST
Global pilot launched in March 2011, the representative track record commences following a proof of concept phase. The FAST Global Composite reflects composited performance data constructed from the
FAST Global pilot from 31 December 2011 to 30 September 2013, and thereafter the A-ACC-USD class of the live FAST Global Fund. While no fees were applied to the FAST Global pilot, its performance has
been adjusted to reflect the 206bps predicted Ongoing Charges Figure of the A-ACC-USD class of the live fund, plus has also been adjusted for an estimation of performance fee had the live fund methodology
been applied to the pilot. Live fund performance may differ from this pilot performance based on the impact of actual expenses associated with live fund administration, transaction costs, shareholder inflows
and outflows, and performance fees. Pilots are funded entirely by Fidelity and are not available for client investment. All trading for pilots is transacted via Fidelity’s centralised dealing desk, in the same way as
a live fund. However, in the absence of sufficient liquidity, all client orders must be completed in full before a pilot receives any allocation. Pilots may also not trade with client accounts. Past performance is not
a reliable indicator of future results. Numbers may not sum due to rounding. *Risk measures based on time periods less than 3 years are not statistically significant.
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Fund Positioning
 Incrementally increasing Emerging Market exposure at the expense of the US
– Not a macro call but driven by bottom-up stock selection
– Emerging market-listed companies e.g. Bank Rakyat, and developed market-listed companies e.g.
Volkswagen, Diageo
– Select large capitalization banks e.g. UBS, Credit Suisse, Citi
– Telecommunications equipment companies e.g. Cisco Systems, Ericsson, Altera
– Biotechnology companies e.g. Amgen, Abbvie
 Stock-specific ‘special situations’
 Remain negative on US telecommunication operators, mining CAPEX and extremely overvalued
technology companies
Source: FIL Limited
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Appendix
19
Performance - as at 31 March 2014 - FAST Global
Standard period excess returns (%)
Calendar year excess returns (%)
10.0%
10.0%
5.0%
5.0%
0.0%
0.0%
-5.0%
-5.0%
-10.0%
-10.0%
Net of
Fees (%)
1m
3m
6m
YTD
1Y
Since
inception
(p.a.)
Composite
1.7
2.7
6.2
2.7
19.7
MSCI ACWI
0.4
1.1
8.5
1.1
Excess
returns
+1.3
+1.7
-2.3
+1.7
Net of
Fees (%)
2012
2013
2014 YTD
23.5
Composite
22.4
27.8
2.7
16.6
17.7
MSCI ACWI
16.1
22.8
1.1
+3.1
+5.8
Excess
returns
+6.3
+5.0
+1.7
Source: FIL Limited, nav-nav, gross income reinvested, in USD, 31 December 2011 to 31 March 2014 . While the FAST Global pilot launched in March 2011, the representative track
record commences following a proof of concept phase. The FAST Global Composite reflects composited performance data constructed from the FAST Global pilot from 31
December 2011 to 30 September 2013, and thereafter the A-ACC-USD class of the live FAST Global Fund. While no fees were applied to the FAST Global pilot, its performance has
been adjusted to reflect the 206bps predicted Ongoing Charges Figure of the A-ACC-USD class of the live fund, plus has also been adjusted for an estimation of performance fee
had the live fund methodology been applied to the pilot. Live fund performance may differ from this pilot performance based on the impact of actual expenses associated with live
fund administration, transaction costs, shareholder inflows and outflows, and performance fees. Pilots are funded entirely by Fidelity and are not available for client investment. All
trading for pilots is transacted via Fidelity’s centralised dealing desk, in the same way as a live fund. However, in the absence of sufficient liquidity, all client orders must be completed
in full before a pilot receives any allocation. Pilots may also not trade with client accounts. Past performance is not a reliable indicator of future results.
20
Attribution vs. comparative index as at March 2014
Delta adjusted average relative weights (%)
Relative contribution (bps)
Pilot
Fund
Pilot
Fund
Total Primary Assets (Incl Cash)
0.0
0.0
2601
-78
- Long Book
-4.6
-2.8
2353
-177
- Long / Short Book
-0.9
-0.2
516
124
Strategy
- of which Short only
-19.1
-21.6
122
145
Cash + FX (Incl Hedging)
5.5
2.9
-269
-25
Fund Fees
0.0
0.0
-760
-113
Other Expenses / Adjustments
0.0
0.0
5
-17
0.0
0.0
1845
-209
Source: FIL Limited, 31 March 2014. Data represents FAST Global Pilot from 1 January 2012 – 30 September 2013, and the live FAST Global Fund from 02 October 2013.
Comparative Index is MSCI AC World (N). Data includes any derivative exposures as an economically equivalent position in the underlying asset. The pilot attribution data includes
an estimation of the effect of fund fees, but live fund performance may differ from this pilot performance based on the impact of actual expenses associated with live fund
administration, transaction costs, shareholder inflows and outflows, performance fees and taxation. The fund attribution analysis is based on the overall portfolio’s holdings and may
therefore differ from individual share class returns.
21
Exposure – beta adjusted total equity level as at March
2014 – life of FAST Global
130%
Pilot
Fund
Beta-adjusted net equity exposure (%TNA)
120%
110%
100%
90%
80%
Source: FIL Limited, 31 March 2014. Data shows the month-end beta-adjusted net equity exposure of the FAST Global Pilot from 31 January 2012 to 30 September 2013 and the
live fund thereafter.
22
Mar 14
Feb 14
Jan 14
Dec 13
Nov 13
Oct 13
Sep 13
Aug 13
Jul 13
Jun 13
May 13
Apr 13
Mar 13
Feb 13
Jan 13
Dec 12
Nov 12
Oct 12
Sep 12
Aug 12
Jul 12
Jun 12
May 12
Apr 12
Mar 12
Feb 12
Jan 12
70%
Exposure – sector - FAST Global Fund as at March 2014
Total Book
Index
weight
Consumer Staples
9.7%
I.T.
12.7%
Materials
6.1%
Industrials
10.8%
Energy
9.7%
Financials
21.5%
Utilities
3.3%
Health Care
10.6%
Telecoms
3.9%
Cons. Discretionary
11.7%
% TNA
-15%
0%
15%
30%
Long
-15%
Short
Long Book
Long/Short Book
% TNA
% TNA
0%
15%
30%
-15%
0%
15%
30%
Relative
Source: FIL Limited, 31 March 2014. Comparison Index is MSCI AC World (N). Data includes any derivative exposures as an economically equivalent position in the underlying
asset. Holdings in different securities of the same asset are also aggregated, therefore classifications are that of the main issuer.
23
Exposure – regions - FAST Global Fund as at March
2014
Total Book
Index
weight
Europe ex UK
17.0%
UK
7.8%
North America
52.7%
Pacific Basin ex JP
4.5%
Japan
7.3%
Emerging Markets
10.7%
Long Book
Long/Short Book
% TNA
% TNA
% TNA
-40%
0%
40%
80%
Long
-40%
Short
0%
40%
80%
-40%
0%
40%
80%
Relative
Source: FIL Limited, 31 March 2014. Comparison Index is MSCI AC World (N). Data includes any derivative exposures as an economically equivalent position in the underlying
asset. Holdings in different securities of the same asset are also aggregated, therefore classifications are that of the main issuer.
24
Exposure – country and currency - FAST Global Fund as
at March 2014
Relative country exposure: Top 5 / Bottom 5
Index weight
Relative currency weights: Top 5 / Bottom 5
% TNA
Index weight
Switzerland
3.4%
Swiss Franc
3.4%
Indonesia
0.3%
Indonesian Rupiah
0.3%
Sweden
1.2%
Swedish Krona
1.2%
Austria
0.1%
Pound Sterling
7.8%
United Kingdom
7.9%
Turkish Lira
0.2%
Netherlands
1.0%
Taiwanese Dollar
1.3%
USA
48.9%
Korean Won
1.7%
Korea (South)
1.7%
Euro
11.7%
Japan
7.3%
Japanese Yen
7.3%
China
2.0%
Hong Kong Dollar
3.0%
-20.0% 0.0% 20.0% 40.0% 60.0%
Long
Source: FIL Limited, 31 March 2014. Comparison Index is MSCI AC World (N). Data
includes any derivative exposures as an economically equivalent position in the
underlying asset. Holdings in different securities of the same asset are also
aggregated, therefore classifications are that of the main issuer.
25
-5.0%
Short
% TNA
0.0%
5.0%
10.0%
Relative
Source: FIL Limited, 31 March 2014. Comparison Index is MSCI AC World (N).
Instrument-specific currency adjustments applied where appropriate to model equity
derivative currency exposures.
Exposure – stock – Top 10 overweight / underweight –
FAST Global Fund as at March 2014
Name
Sector
Region
(% TNA)
Index
Relative
Cisco Systems
IT
North America
5.2
0.3
4.9
Altera
IT
North America
4.8
0.0
4.8
Praxair
Materials
North America
4.7
0.1
4.6
Ericsson
IT
Europe ex UK
4.6
0.1
4.5
CME Group
Financials
North America
4.1
0.1
4.0
Monsanto
Materials
North America
3.9
0.2
3.7
Danone
Cons. Staples
Europe ex UK
3.7
0.1
3.6
JSR
Materials
Japan
3.6
0.0
3.6
Volkswagen
Cons. Discretionary
Europe ex UK
3.5
0.1
3.4
Citigroup
Financials
North America
3.6
0.4
3.2
Short Position - name withheld
IT
North America
-1.0
1.3
-2.3
Short Position - name withheld
Telecoms
North America
-1.6
0.5
-2.1
Short Position - name withheld
IT
North America
-1.0
0.9
-1.9
Short Position - name withheld
IT
UK
-1.7
0.1
-1.8
Exxon Mobil
Energy
North America
0.0
1.2
-1.2
Short Position - name withheld
IT
North America
-1.0
0.1
-1.1
Short Position - name withheld
IT
North America
-1.0
0.1
-1.0
Microsoft
IT
North America
0.0
0.9
-0.9
Short Position - name withheld
Energy
Europe ex UK
-0.9
0.0
-0.9
Short Position - name withheld
Industrials
Europe ex UK
-0.8
0.1
-0.9
Source: FIL Limited 31 March 2014. Comparison Index is MSCI AC World (N). Data includes any derivative exposures as an economically equivalent position in the underlying asset.
Excludes index positions. In the underweight table, any short position names have been withheld in line with FIL’s disclosure policy.
26
Country
27
Currency
Industry
Risk Indices
Stockspecific
Jan 12
Feb 12
Mar 12
Apr 12
May 12
Jun 12
Jul 12
Aug 12
Sep 12
Oct 12
Nov 12
Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Jan 12
Feb 12
Mar 12
Apr 12
May 12
Jun 12
Jul 12
Aug 12
Sep 12
Oct 12
Nov 12
Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Jan 12
Feb 12
Mar 12
Apr 12
May 12
Jun 12
Jul 12
Aug 12
Sep 12
Oct 12
Nov 12
Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Jan 12
Feb 12
Mar 12
Apr 12
May 12
Jun 12
Jul 12
Aug 12
Sep 12
Oct 12
Nov 12
Dec 12
Jan 13
Feb 13
Mar 13
Apr 13
May 13
Jun 13
Jul 13
Aug 13
Sep 13
Oct 13
Nov 13
Dec 13
Jan 14
Feb 14
Mar 14
Risk – life of FAST Global as at March 2014
Tracking error (ex ante, %)
Beta (ex ante)
6.0
1.10
5.0
1.05
4.0
1.00
3.0
0.95
2.0
0.90
1.0
0.85
0.0
0.80
Equity
Active money (%)
Volatility (ex ante, %)
125%
22%
120%
20%
115%
18%
110%
16%
105%
14%
100%
12%
95%
10%
Fund Vol
BM Vol
Source: FIL Limited, 31 March 2014. Comparative index = MSCI AC World. Data represents the FAST Global Pilot from January 2012 to September 2013 and the live fund
thereafter. Data includes any derivative exposures as an economically equivalent position in the underlying asset.
Quarterly Attribution – FAST Global as at March 2014
Delta adjusted average relative weights (%)
Strategy
Relative contribution (bps)
1Q-12 2Q-12 3Q-12 4Q-12 1Q-13 2Q-13 3Q-13 4Q-13 1Q-14 1Q-12 2Q-12 3Q-12 4Q-12 1Q-13 2Q-13 3Q-13 4Q-13 1Q-14
Total Primary Assets (Incl
Cash)
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
468
133
114
169
388
594
36
-294
211
- Long Book
-4.2
-5.7
-5.5
-4.2
-5.1
-4.7
-2.7
-2.5
-3.0
543
16
117
188
235
468
176
-229
54
- Long / Short Book
-0.1
1.4
-0.2
-1.3
-1.9
-2.8
-1.5
0.1
-0.5
-18
103
49
19
202
134
-129
-49
166
-13.8
-12.5
-12.1
-19.2
-24.5
-26.9
-24.4
-23.2
-20.1
Cash + FX (Incl Hedging)
4.3
4.4
5.8
5.5
7.0
7.5
4.3
2.4
3.5
-57
14
-52
-39
-49
-8
-11
-16
-9
Effect of Fund Fees
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-129
-65
-41
-78
-68
-143
1
-59
-51
Other Expenses / Adjustments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-9
5
4
0
-3
5
-2
-10
-7
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
330
73
77
91
317
455
35
-363
154
- of which Short only
-90
68
54
22
27
23
-29
35
104
Source: FIL Limited, 1 January 2012 – 31 March 2014. Comparative Index is MSCI AC World (N). Data includes any derivative exposures as an economically equivalent position in
the underlying asset. While the FAST Global pilot launched in March 2011, the representative track record commences following a proof of concept phase. While no fees are applied
to the FAST Global pilot, its performance has been adjusted from 31 December 2011 to reflect the 206bps predicted Ongoing Charges Figure of the A-ACC-USD class of the live
fund, plus has also been adjusted for an estimation of performance fee had the live fund methodology been applied to the pilot. This attribution data includes an estimation of the
effect of fund fees, but live fund performance may differ from this pilot performance based on the impact of actual expenses associated with live fund administration, transaction
costs, shareholder inflows and outflows, performance fees and taxation. Pilots are funded entirely by Fidelity and are not available for client investment. All trading for pilots is
transacted via Fidelity’s centralised dealing desk, in the same way as a live fund. However, in the absence of sufficient liquidity, all client orders must be completed in full before a
pilot receives any allocation. Pilots may also not trade with client accounts. Past performance is not a reliable indicator of future results. Numbers may not sum due to rounding.
28
Global Equity – research resources
Global research coverage across all industry verticals and geographies
Healthcare
Financials /
Real Estate
TMT
Consumer
Natural
Resources
& Utilities
Industrials /
Cyclicals2
US
2
4
3
3
3
2
Europe
2
7
6
7
7
10
EMEA & LatAm
-
1
1
1
2
2
Japan1
2
4
4
4
1
10
Asia ex Japan team1
3
10
8
18
17
21
9
26
22
33
30
45
Nicky Stafford
Chris Moore
Chris Moore
Equity Support
Global Sector PMs
12 Specialists
Hilary Natoff
Sotiris Boutsis
Dirk Philippa
Hyun Ho Sohn
Aditya Shivram
 160+ research analysts and 7 global sector portfolio managers
Source: FIL Limited as at 31 December 2013. Equity analysts only.
Trading and Steel, Paper Metal and Mining.
29
1 Analysts
in Japan and Asia cover more than 1 sector. 2 Japan & Asia ex Japan “Cyclicals” includes Energy &
A proprietary source of high value global ideas
Proprietary fundamental
research
Relative value added by Fidelity’s research
recommendations, rolling 1-year performance
20%
15%
10%
5%
0%
-5%
Jul-07
Oct-07
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
Jul-09
Nov-09
Feb-10
May-10
Aug-10
Nov-10
Feb-11
May-11
Aug-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
Mar-13
Jun-13
Sep-13
Dec-13
-10%
Asia ex Japan
Europe
Japan
Source: FIL as at 31 December 2013, all stocks equal weighted. Raw data from Analyst Rating Metrics (ARM) system. Europe includes EMEA & Lat-Am.
30
US
Important notes
ATTENTION: If this fund is not registered in your jurisdiction, the distribution of this document and the offering of Shares may be restricted. Accordingly, it is only directed at and
issued to specially selected persons such as qualifying investment professionals to whom it may be lawfully promoted. This document does not constitute an offer or solicitation to
any person in any jurisdiction in which to make such an offer or solicitation may be unlawful and should not be relied upon by persons who do not have professional experience of
participating in such offers. This document is for Professional Investors only and should not be relied upon by private investors. This document is intended only for the person or
entity to which it is provided. It must not be reproduced or circulated without prior permission. Distribution or reproduction of this document, in whole or in part, or the divulgence of
any of its content, is strictly prohibited. This document is protected by copyright and may not be photocopied, amended or reproduced in any manner without Fidelity Worldwide
Investment's written permission. Fidelity Active STrategy (‘FAST’ or the ‘Fund’) is an open-ended investment company (SICAV) established in Luxembourg with different classes of
shares. The Fund is registered under Part I of the Luxembourg Law of 17 December 2010 relating to undertakings for collective investment, as amended (the “Law of 2010”). The
Fund therefore qualifies as an undertaking for collective investment in transferable securities (‘UCITS’) and has obtained recognition under the Directive 2009/65/EC. Investments
should be made on the basis of the current Key Investor Information Document (KIID) and prospectus, which are available along with any current annual and semi-annual reports
free of charge from our European Service Centre in Luxembourg or from the offices of FIL as outlined below. Any investment activity described or referred to in this document is
available only to qualifying investment professionals and will be engaged in only with qualifying investment professionals. Fidelity Worldwide Investment only gives information about
its own products and services and does not provide investment advice based on individual circumstances. Any reference to specific securities is included for the purposes of
illustration only and should not be construed as a recommendation to buy or sell the same. Investors should also note that the views expressed may no longer be current and may
have already been acted upon by Fidelity Worldwide Investment. Unless otherwise stated, all views are those of Fidelity Worldwide Investment. Past performance is not a reliable
indicator of future returns. The value of investments can go down as well as up and investors may not get back the amount invested. Investments denominated in a currency other
than the investor’s own currency will be subject to movements in foreign exchange rates. Foreign exchange transactions may be effected on an arm’s length basis by or through
Fidelity Worldwide Investment companies from which a benefit may be derived by such companies. Investments in small and emerging markets can be more volatile than other more
developed markets. Due to the lack of liquidity in many smaller stock markets, certain funds may be volatile and redemption rights may be restricted in extreme circumstances. In
certain countries, and for certain types of investments, transaction costs are higher and liquidity is lower than elsewhere. For funds specializing in such countries and investment
types, transactions, particularly those large in size, are likely to have a greater impact on the costs of running a fund than similar transactions in larger funds. Performance of bonds is
affected by changes in interest rates and the issue of new bonds. If interest rates rise, bond prices fall and vice versa. Bonds are also subject to credit risk and default, and an
investment in corporate bonds is generally less secure than an investment in Government bonds. Prospective investors should bear this in mind in selecting funds. In addition,
investment in the fund may involve greater risk as a result of the fund’s use of derivatives, such as futures, forwards, swaps and options. Examples of the investment techniques for
which the fund may use derivatives (though not exhaustive) include establishment of synthetic long and short positions, the creation of leverage that increases the fund’s economic
exposure beyond the value of its net assets, or for hedging purposes. Whilst Fidelity Worldwide Investment employs a sophisticated risk management process to oversee and
manage derivative exposures within the fund, investors should be aware that the use of derivative instruments may involve risks different from, and, in certain cases, greater than, the
risks presented by the securities from which they are derived. Further details of the risks involved in investing in the fund are given in the prospectus and the Key Investor Document
(KID), which all investors should read before investing. In the event of systemic shocks to financial markets, liquidity can become severely restricted causing some firms to withdraw
from the market or, in extreme cases, become insolvent. Such events may have an adverse impact on the fund, particularly where the fund has counterparty exposure to the
companies involved. Equally, the fund’s ability to utilise synthetic short exposures might from time to time be restricted in certain sectors, securities and/or certain jurisdictions due to
local regulations. FIL means FIL Limited and its respective subsidiary companies. Fidelity, Fidelity Worldwide Investment, the Fidelity Worldwide Investment logo and F symbol are
trademarks of FIL Limited. No statements or representations made in this document are legally binding on Fidelity Worldwide Investment or the recipient. Any proposal is subject to
contract terms being agreed. Barra. Inc.’s analytics and data (www.barra.com) were used in the preparation of this document. Copyright 2013 BARRA, INC. All rights reserved. This
material is issued by FIL Investments International, FIL (Luxembourg) S.A. and FIL Investment Services GmbH, Postfach 200237, 60606 Frankfurt/Main. FIL Investments
International is authorised and regulated by the Financial Conduct Authority in the UK (FCA registered number 122170) and FIL (Luxembourg) S.A. is authorised and regulated by
the Commission de Surveilllance du Secteur Financier (CSSF) in Luxembourg. FIL Investments International is a member of the Fidelity Worldwide Investment group of companies
and is incorporated in England and Wales under company number 1448245 with registered address at Oakhill House, 130 Tonbridge Road, Hildenborough, Tonbridge, Kent TN11
9DZ, United Kingdom.
FCRU0582
31
Country specific notifications
For residents of Austria: We recommend that you obtain detailed information before taking any investment decision. Investments should be made on the basis of the current
prospectus/Key Investor Information Document (KIID), which is available along with the current annual and semi-annual reports free of charge from: FIL (Luxembourg), S.A., 2a rue
Borchette, 1021 Luxembourg, Luxembourg; at the service point: FIL Investment Services GmbH, Kastanienhöhe 1, D-61476 Kronberg im Taunus, Germany; FIL (Luxembourg) S.A.,
Zweigniederlassung Wien, Mariahilfer Strasse 36, 1070 Wien or www.fidelity.at as well as with the Austrian paying agent UniCredit Bank Austria AG, Vordere Zollamtstrasse 13, A1030 Wien.
For residents of Belgium: We recommend that you obtain detailed information before taking any investment decision. Investments should be made on the basis of the current Key
Investor Information Document (KIID) and prospectus, including the Addendum for Belgian investors, which are available along with the current annual and semi-annual reports free
of charge from our distributors, from FIL (Luxembourg) S.A. and CACEIS België NV, with head office at Havenlaan 86C, B320, 1000 - Brussels, the financial service provider in
Belgium.
For residents of Germany: Eine Anlageentscheidung sollte in jedem Fall auf Grundlage der wesentlichen Anlegerinformationen, des Verkaufsprospektes, des letzten
Geschäftsberichtes und - sofern nachfolgend veröffentlicht - des jüngsten Halbjahresberichtes getroffen werden. Diese Unterlagen sind die allein verbindliche Grundlage des Kaufes
und können kostenlos bei der FIL Investment Services GmbH, Postfach 200237, 60606 Frankfurt/Main oder . Die FIL Investment Services GmbH veröffentlicht ausschließlich
produktbezogene Informationen und erteilt keine Anlageempfehlung.
For residents of Spain: For the purposes of distribution in Spain, FAST is registered with the CNMV Register of Foreign Collective Investment Schemes under registration number
649, where complete information is available from the authorised distributors. The purchase of or subscription for shares in FAST shall be made on the basis of the Key Investor
Information Document that investors shall receive in advance. The Key Investor Information Document is available free of charge from, and for inspection at, the offices of locally
authorised distributors as well as at the CNMV.
For residents of the UK: Fidelity Active STrategy (SICAV) (FAST or the ‘Fund’) is recognised under section 264 of the Financial Services and Markets Act 2000. Investors should
note that loss caused by such recognised funds will not be covered by the provisions of the Financial Services Compensation Scheme (or by any similar scheme in Luxembourg) if
the Fund is unable to meet its obligations; however, claims for loss in regards to such recognised funds against an FCA authorised firm such as FIL Investments International will be.
For residents of the Netherlands: Investments should be made on the basis of the current Key Investor Information Document (KIID) and prospectus, which are available along
with the current annual and semi-annual reports free of charge from our distributors, from FIL (Luxembourg) S.A. in Luxembourg and from FIL (Luxembourg) S.A., Netherlands
Branch , World Trade Center, Tower H, 6th Floor, Zuidplein 52, 1077 XV Amsterdam (tel. 0031 20 79 77 100). FAST is authorised to offer participation rights in The Netherlands
pursuant to article 2:66 (3) in conjunction with article 2:71 and 2:72 Financial Supervision Act.
32