Anthony Bolton to Retire in 2014; Morningstar Rating Under Review

Morningstar analysts assure investors there's no need to panic, while placing Fidelity China Special Situations under review on news Anthony Bolton will retire in April 2014

Holly Cook 17 June, 2013 | 10:34AM
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Veteran investor and manager of the Fidelity China Special Situations (FCSS) trust Anthony Bolton is to retire from asset management in April 2014. 

Bolton made a surprise return from retirement in 2010 to manage the China Special Situations trust, having stepped down three years previously after 28 years at the helm of Fidelity Special Situations. Though initially celebrated, his return to fund management saw him struggle to generate the returns expected by investors in the China investment trust, underperforming the benchmark and currently trading at just over 86p per share—below the 100p launch price.

In the past year, however, Fidelity China Special Situations has performed much better for shareholders, with net asset value up 22% in the last 12 months versus 14% for the Morningstar category on average.

Responding to today’s news, Morningstar analysts have moved their former Neutral rating to Under Review, though they reiterated their confidence in Dale Nicholls, who will take over management of Fidelity China Special Situations next April.

"The news that Anthony Bolton has confirmed his intention to step down from fund management in April 2014 has not come as a surprise. The fund's performance this year has been markedly better than the first two years and Bolton wanted a good end to a long and successful career," commented Jackie Beard, director of closed-end fund research at Morningstar  UK.

"We welcome the clarity that investors now have regarding the fund's future management. Dale Nicholls is a long-standing Fidelity employee who has a bent towards smaller companies. He uses the same analytical resources that Bolton himself draws upon and he has been running funds for Fidelity in the Asian region for almost a decade," Beard added.

Morningstar analysts warned against any knee-jerk reactions from shareholders: "We see no reason for existing investors to panic as this is merely confirmation of what we knew was on the horizon," Beard said.

Jackie Beard and team will be assessing Nicholls' track record and management ahead of meeting him next month, around the time of the fund's annual general meeting.

"We have placed our rating under review pending our meeting with the incoming manager," Beard confirmed on Monday morning.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Fidelity China Special Ord242.50 GBX-0.21Rating
Fidelity Special Situations5,249.02 GBP-0.19Rating

About Author

Holly Cook

Holly Cook  is Manager, Morningstar EMEA Websites

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