hewhodares1
14 May 2015
Re: Largest holding... Well spotted..... still don't understand why there is such a discount to the NAV
tegami01
13 May 2015
Largest holding... Ten Cent's profits exceed expectations:[link] good.
tegami01
05 May 2015
Discount to NAV... ...is now 16%.
sage in the hills
17 Apr 2015
Strong build in NAV ...... ok, profit-taking by some people today .....SAGE
sage in the hills
16 Apr 2015
NAV is .... 192.76p so sizeable discount Big discount for buyers AND China to introduce some easingSAGE
Kingel
14 Apr 2015
HL "5 Years On" Time seems to fly by faster the older I get. I recently met Dale Nicholls, manager of Fidelity China Special Situations plc and it amazed me to think the investment trust launched almost five years ago.The trust performed poorly in the early days and some investors were scared away at exactly the wrong time. Anthony Bolton, the trust's original manager, took a fair amount of flack at the time; most of it unwarranted in my view.Those who invested at launch and continued to hold have been rewarded so far: the trust's share price has grown 57.0%*, with dividends reinvested, against the benchmark MSCI China Index's return of 37.5%. Please remember past performance is not a guide to future returns. I am encouraged by the results since Dale Nicholls took over the trust on 1 April 2014. Since then, the share price has risen by 40.0%*, in line with the performance of the MSCI China Index at 40.3%, though this is only over a short timeframe. (*source Lipper IM to 01/04/2015).China, the investment storyChina seems to divide investors like no other nation. Prolonged negative sentiment towards the country has contributed to many Chinese-focused investment trusts trading on a significant discount to their net asset value. At the time of writing, Fidelity China Special Situations plc trades on a discount of 10.7%, though it is possible this discount could widen further still. This compares with a 12 month average discount of 12.0%.In our recent meeting, Dale Nicholls touched on his view for the Chinese economy. However, he places more emphasis on the prospects for individual companies when it comes to constructing the portfolio. The manager feels more assured about the Chinese property market. He has seen a clear change in mentality from both buyers and developers, particularly within the major cities where developers are beginning to think about raising prices and where demand is picking up. The rate of growing debt is slowing, but is still a concern, he would prefer it to slow at a faster rate. His major worry is that China ends up in a similar scenario to Japan, where uncertainty surrounds how many loans are in, or close to being in, default. As such, he does not own any of the major banks.The opening up of China’s onshore-market presents a big opportunity. The market, previously only available to onshore investors or those with a special licence, is under-researched and is full of companies unknown to many investors. Further extension of this ‘Stock Connect’ programme and the inclusion of A-shares in the MSCI indices could provide a catalyst for this area of the market. Opening the market has also boosted transaction volumes, benefiting brokers such as CITIC Securities and Haitong International, both held in the portfolio. Shares on the A-share market are still below historic averages but have seen a significant pick up in recent months. However, there are no guarantees this performance will continue.E-commerce remains a fantastic opportunity in China. Internet penetration is still only 50% in China compared with more than 90% in the West, meaning there is plenty of scope for growth. The trust's current largest holding is Tencent, China's largest internet service portal.Alibaba, similar to Amazon and eBay, was held in the trust before it listed on the stock market (initially purchased by Anthony Bolton). Dale Nicholls has since taken some profits from this position. This appears to have been the correct call as Alibaba's latest results were a little disappointing and the share price is currently 30% below its post-IPO high.Other sectors he favours include insurance and Railways, with companies such as Ping An Insurance featuring in the trust. Demand for insurance is growing, while railway companies offer a great source of strong cash flows and investment is increasing.Our view on this trustThe opportunity in China is a long-term story and I believe it is still intact. Perhaps more importan
tegami01
12 Apr 2015
Re: Recent performance.... I got in only 10 days ago at 143 then out on Thu at 164. Really like this stock been watching for ages and don't particularly intend to trade it but can't help but think some of the rise is ISA activity which may have already spiked. Probably foolish but waiting now for a suitable re-entry.
San Jaime
10 Apr 2015
Recent performance.... Progress at last. This line in my portfolio now showing nearly 70% up.It has been a good month for FCSS - long may it continue.Discount has improved also - now around 10%Well done if you got in around 130p at Christmas, or in the dip earlier this year
Ripley94
23 Mar 2015
Re: edison report - nav 159p Thanks for posting that report.
forwardloop
20 Mar 2015
edison report - nav 159p [link]
Kingel
01 Mar 2015
CityWire How Dale Nicholls stamped his mark on Fidelity's China trustSome questioned Dale Nicholls' appointment as Anthony Bolton's successor on Fidelity China Special Situations, but he has delivered strong returns. Nearly a year after succeeding Anthony Bolton as manager of Fidelity China Special Situations (FCSS ), Dale Nicholls can look back on a creditable 2014 in which the trust was a surprise performer.Nicholls was for some a shock choice as the successor to Antony Bolton, the star manager who built a reputation as one of the best in his generation at the helm of Fidelity Special Situations and Fidelity Special Values (FSV ), before being lured back into fund management by the prospect of investing in China.Bolton endured a difficult start on the trust, which launched in 2010, but had restored performance by the time Nicholls came on board at the beginning of last year, officially taking charge in April. But despite investors sending the trust to a 10% discount on news of Bolton's departure, and analysts questioning whether Nicholls was the right appointment given he hadn't run a dedicated China fund before, the new man has built on the trust's resurgence.Shares in the trust are up 31% since Nicholls took charge, nearly double the return of its benchmark, the MSCI China index, over that period. A large part of that can be attributed to Bolton's investment in Alibaba (BABA.K), the Chinese e-commerce website, ahead of its record $25 billion initial public offering last year.Bolton bought Alibaba in 2012 when it was unlisted, and by July last year it had become the trust's second largest holding at 4.4% of the portfolio. The trust's net asset value surged 7.4% in one day last September as investors scrambled for a piece of Alibaba's record-breaking flotation.However, Nicholls (pictured) can take credit for locking in some of those gains. He has been reducing the fund's stake in the stock, which now makes up 1.9% of the trust, after the shares rose as high as 119 cents in November before falling back below its 92.7 cents opening price to trade at 86.2 cents. FCSS has made a more than four-fold gain on its original investment.Nicholls said he was now comfortable with Alibaba's price. 'At this level I'm very much inclined to hold,' he said. But the trust's strong 2014 was about more than just Alibaba. Nicholls has stamped his mark on the trust by increasing its holding in insurers, with two firms – Ping An (601318.SS) and China Pacific (601601.SS) – now the trust's second and third largest holdings. Shares in both have rallied strongly in the last year, which Ping An up 83% and China Pacific rising 75%.Nicholls also bolstered the trust's holding in Gree Electric (000651.SZ), the world's largest manufacturer of household air conditioners, whose shares are up 35% over the last year. The trust has a strong technology theme running through it – the top holding is internet stock Tencent (0700.HK), which runs social networking, e-commerce and gaming businesses – and Nicholls has added to that with some stocks of his own. He cites 51job (JOBS.O), which provides online human resources services to businesses, as an example. Consumer focusThat has been coupled with a strengthening of the trust's second major theme: consumer spending. Consumer stocks have now overtaken technology companies as the biggest weighting in the fund.Despite buying up insurance names, the trust remains heavily 'underweight' – holding less than the index – in financials. Nicholls sold stockbroker Haitong Securities (600837.SS) before it was hit by a regulatory clampdown on margin lending earlier this year, but said the move was 'really about valuation', with the shares more than doubling in November and December last year.He has also trimmed the position in Citic Securities (600030.SS), also victim of a ban on opening new margin trading accounts – which allow investors to borrow money to buy stocks – for three months, re
Kingel
22 Dec 2014
Trust turns it round in turbulent year CityWireOne fund that has surprised me by doing very well this year is Fidelity China Special Situations (FCSS + At the time of writing this, it had delivered net asset value (NAV) growth of 29.7% this year and a 26.6% improvement in its share price. Note that the share price has lagged the NAV over the year. After a difficult start, FCSS shareholders have received a total return of 133% since its launch in April 2010, with NAV growth of nearly 148%.FCSS’s discount is now just over 11%, which seems a bit wide for a fund that has done so well (though it is a bit narrower than it was in the middle of October).I suppose I should begin by explaining why I am surprised that FCSS has done so well. I started off 2014 by saying I found it hard to forecast what was going to happen to markets over the course of the year. For China, worries grew over the scale of credit growth within the economy and some suggested the country’s property bubble would burst and its shadow banking system implode in 2014, with a major adverse effect on the economy. GDP growth rates slowed too. Forecasts were for about 7.5% growth at the start of the year and many commentators revised this downwards as the year progressed.Ignore the headlinesDale Nicholls, manager of FCSS, is more sanguine however. He thinks it is easy to get fixated about headline GDP numbers and falling property prices and thereby miss the big changes that are going on in China’s underlying economy. He says that even if growth is slower than in previous years, it is still growth and much faster growth than is prevalent in most of the rest of the world. Within this context, well managed companies have ample room to grow. He thinks those serving the needs of China’s burgeoning consumer market are particularly well placed.Nicholls is enthused about the potential impact of social reforms in China. He believes changes to the hukou system of household registration (which effectively governs where you are allowed to live within the country) have the potential to dramatically improve the lives of around 100 million workers. These people, who have been encouraged to migrate to cities in search of work, will now get access to social welfare and healthcare benefits currently denied them. Robertson thinks these people will save less and spend more, boosting consumer demand.Then there is the relatively low rating of Chinese companies compared to their developed market peers. At the end of October, the price to earnings ratio on the MSCI China index was just 9.5 compared to a multiple of 18 for the S&P 500 in the US. In the long run it seems nonsensical that this disparity will persist. Deregulating who can invest in the domestic Chinese stock market (alongside allowing Chinese people access to international markets), could help narrow the gap.So maybe things in China aren’t as bad as feared. Its stock market has made decent gains year to date – the MSCI China is up 13.3%, which is quite respectable and ahead of the wider Asian region. FCSS though has outperformed the index by some margin – how did it manage this?One big winner this year has been its holding in Alibaba. FCSS took a stake in this while it was still unquoted and reaped the rewards when Alibaba (BABA.N) floated in September – the largest initial public offer (IPO) ever. Pre-IPO investments have fallen in and out with shareholders of investment companies over the years. The thing is they are great when they work but a nightmare when they don’t. The sector is littered with examples of funds that took stakes in something that was about to float but never made it and ended up being a time consuming and hard to explain drag on returns for years after. When they work, however, they can work very well. At the opening value of Alibaba, FCSS was sitting on a stake worth 4.6 times its initial investment. Robertson has taken some profits but Alibaba was still the second largest hold
San Jaime
22 Dec 2014
Re: New to FCSS Welcome aboard. With a discount today of around 12% (Nav 146 / SP 130) this is probably quite a good time to get in to FCSS. Although expect this fund to continue to trade within a 9% to 13% discount window from now on - long gone are the days of trading at a premium.SJPS - Sorry but am hoping that the oil price will recover during 2015 as energy investments have really suffered..
AuGment
19 Dec 2014
New to FCSS Just bought in on the basis of the sharp decline in oil price. any decline in oil price has got to be good for manufacturing based economies - e.g china. time will tell.the 10% discount is a good omen - looks slightly out of favour at the moment.
San Jaime
09 Dec 2014
Re: Latest rise halted - 130p again ! Bad day for FCSS today - back down below 130p.From BBC Business News :-----Profit-taking by investors in China sent the Shanghai Composite lower by more than 5% in Tuesday trade.The benchmark index gave up 163.9 points or 5.4% at the close, to end at 2,856.27 points.That is the biggest one-day percentage fall since August 2009.Investors went on a profit-taking spree one day after the benchmark index broke past the 3,000 mark for the first time in more than three years.Shares of Chinese financial and property firms were caught in the selloff.The profit-taking filtered into neighbouring Hong Kong, where the benchmark Hang Seng index closed lower by 2.3% to 23,485.83 points.-----Thought Dale was staying away from Banking and Property sectors, so it will be interesting to see impact on our NAV.
