The FSA Spy market buzz – 1 November 2024
Battleshares’ old versus new, Goldman Sachs’ Cassandra warning, Hong Kong property’s negative equity woes, Ninety One’s trillion-dollar question, Contrarian alert from CB, Lists and much more.
HEAD-TO-HEAD: Fidelity versus Schroders
FSA compares two China equity products: the Fidelity China Focus Fund and the Schroder ISF China Opportunities Fund.
Germaine Share, Morningstar
Introduction
China’s equity markets have enjoyed a sharp recovery since the slump in mid-March amid justifiable fears that the Covid-19 pandemic would induce a severe contraction to the country’s economy.
The MSCI China index is up 19.55% year-to-date, and has surged 47% since its low on 19 March, according to FE Fundinfo.
Domestic investors have taken advantage of lower valuations and cheaper borrowing costs to drive the markets higher, while international funds have rationalised that China is recovering earliest and fastest from the economic consequences of coronavirus.
Technology stocks have been in the vanguard of the rally, buoyed by analysts’ predictions that ecommerce and online gaming habits acquired during lockdowns will persist and drive tech companies’ earnings higher.
In this unstable, confusing environment, Germaine Share, associate director at Morningstar, compared two large China equity funds, with very contrasting investment styles: the Fidelity China Focus Fund and the Schroder ISF China Opportunities Fund.
| Fidelity | Schroders | |
| Size | $2.89bn | $1.26bn |
| Inception | 2003 | 2006 |
| Managers | Jing Ning | Louisa Lo |
| Three-year cumulative return | -0.61% | 36.49% |
| Three-year annualised return | 0.88% | 10.70% |
| Three-year annualised alpha | -6.38 | 2.26 |
| Three-year annualised volatility | 21.22% | 21.80% |
| Three-year information ratio | -0.81 | 0.32 |
| Morningstar star rating | ** | **** |
| Morningstar analyst rating | Bronze | Gold |
| FE Crown fund rating | * | ** |
| OCF (clean share class) | 1.91% | 1.84% |
Source: FE Fundinfo, Morningstar (Data in US dollars, 4 September 2020)
Related Stories
Promoted Content
-
Conditions in the high yield market
-
Fixed income – making ground in ESG as ETFs see rapid growth in AUM
-
How ETFs offer an active way to drive sustainable returns
-
Sustainable Investing in Changing Market Conditions
-
Dynamism is the name of the game for this global macro strategy
-
Riding the wave of alternative income amongst HNWIs in APAC
-
How can a sustainable approach also ensure you don’t compromise performance?
-
Smartphones on wheels
-
China bonds: plugging the yield gap
-
M&G Episode Macro shines after tough year
