Morningstar's Manager Check-Up

REAFFIRMED RATINGS: Why Morningstar fund analysts positively rate funds by Fidelity, Newton and Rathbone

Jonathan Miller 27 March, 2019 | 8:39AM
Facebook Twitter LinkedIn



Jonathan Miller: Welcome to the Morningstar manager check-up for three fund updates from our research team.

Fidelity Greater China has been managed by Raymond Ma since 2012 and is supported by a team of 14 Greater China analysts. He manages the portfolio in a benchmark-aware and diversified manner, with a preference for growth stocks. As part of his search for companies with earnings growth and cash flow generation, he also has the flexibility to invest in turnaround and underappreciated opportunities. With over 100 holdings, half are smaller positions to incubate new ideas or obtain small-cap exposure. We believe Ma is a capable manager supported by a sizeable analyst team, and strong returns have been delivered under his watch. The fund therefore maintains its Morningstar Analyst Rating of Bronze.

Next is the Newton International Bond fund, where Paul Brain has been at the helm since 2008. The fixed-income team consists of 10 members and there’s a thematic approach for idea generation. This is very much a core offering that only invests in government bonds from G10 countries. Most peers will have some exposure to corporate bonds, but this fund sticks solely to developed market sovereign debt. He relies on adjusting the sensitivity to interest rates and yield curve positioning as the main performance drivers. Then currency and country allocation play a part. With a stable and experienced team that’s consistently implemented the approach, the fund retains its Morningstar Analyst Rating of Bronze.

Finally, the Rathbone Income fund which has been managed by Carl Stick since 2000. He’s now aided by Alan Dobbie as a co-manager, so decision making is shared. Stick has applied the same investment approach throughout his tenure, where the focus has always been on structured bottom-up fundamental research within a macroeconomic framework. He aims to identify quality companies with healthy dividend yields that can grow their dividends by at least the rate of inflation each year. While such a focused and unconstrained approach can result in a return profile that’s different to the benchmark and peers over the short term, Stick's focus on quality and strict valuation discipline mean the long-term risk-adjusted returns are compelling. We see this as a solid choice, worthy of its Morningstar Analyst Rating of Bronze.

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.

Facebook Twitter LinkedIn

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
BNY Mellon International Bond Inst W Acc1.11 GBP0.65Rating
Fidelity Greater China Y-Acc-USD24.86 USD1.16Rating
Rathbone Income S Acc2,120.05 GBP-0.64Rating

About Author

Jonathan Miller  is Director of Manager Research, Morningstar UK

© Copyright 2024 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Modern Slavery Statement        Cookie Settings        Disclosures