Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Fidelity hands Shah's Special Values trust to Alex Wright

Fidelity hands Shah's Special Values trust to Alex Wright

The board of Fidelity Special Values and Fidelity Worldwide Investment has announced Alex Wright has been appointed as portfolio manager of the investment trust, taking over from Sanjeev Shah.

The change kick-starts the vehicle's transition towards a focus more heavily on smaller and mid-cap stocks, an area which Fidelity UK Smaller Companies manager Wright specialises in.

It will also allow Shah to concentrate on running the open-end Fidelity Special Situations fund.

Over three years to the end of April, the Fidelity Special Values trust has lagged its benchmark, the FTSE All Share Index, returning 36.8% versus  51.6% by its comparator index, while its discount has sagged to roughly to 12%. 

Shah's Fidelity Special Situations fund, previously managed by veteran stockpicker Anthony Bolton, has also struggled in recent years.  Over the same stretch the £2.2 billion fund delivered 22.4%, compared to 43.6% by the FTSE 100 TR Index and 36.1% by the FTSE All Share TR.

Over the period holdings in banks have been a particular drag on Shah's performance, with troubled Lloyds accounting for 4.9% of his portfolio.  The last three years have seen Lloyds struggle to regain its footing after being bailed out by the government, with its journey back to health including the disposal of branches and more recently attempts to offload £1 billion of toxic debt.  Its shares have failed to respond though, falling 45% in the three years to the end of April.

Shift to small caps

Announcing the management change to investors, Fidelity said it was the board's intention for the vehicle to concentrate on delivering returns from small and mid cap stocks. 

While Wright has over 10 years' experience at Fidelity, where he initially came on board as a research analyst, he is the top perforner in his Investment Management Association (IMA) peer group, a position he has held since the trust's inception in February 2008.

'The board is keen to take greater advantage of opportunities for capital growth available from dynamic smaller and mid-cap companies and this is an area where Alex has demonstrated considerable success,' said Lynn Ruddick, chairman of Fidelity Special Values,  as she told the market of the trust's plan.

Ruddick added: 'We respect the wishes of Sanjeev Shah to focus exclusively on his open-end fund and the board would like to thank him for his diligent management of the portfolio in what has been a particularly challenging period in equity markets.'

The investment strategy and company’s benchmark will both remain unchanged under Wright's leadership, and like Shah (pictured), Wright will aim to generate returns by investing in out-of-favour stocks with downside protection and unrecognised growth.

The change of manager will take effect from 1 September, allowing for an orderly handover of the portfolio.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Liontrust ESG head says sustainable investment doesn't mean low return

Liontrust ESG head says sustainable investment doesn't mean low return

Peter Michaelis talks about ethical investment growth and where he sees future opportunites.

Play Are platforms the biggest barrier to wealth manager ETF take-up?

Are platforms the biggest barrier to wealth manager ETF take-up?

Citywire hosted a roundtable discussion to find out how and if wealth managers are using ETFs in their clients' portfolios and the challenges they face trading through different platforms.

Play SVM's Veitch on what's next for banks

SVM's Veitch on what's next for banks

SVM fund manager Neil Veitch is finding value in what he describes as unstable financials and talks through his favourite small caps.

Read More
Your Business: Cover Star Club

Profile: UBS' robo boss on what his tween can teach the industry

Profile: UBS' robo boss on what his tween can teach the industry

Co-head of UBS SmartWealth Shane Williams explains the simple life lessons missed by the first wave of robo pioneers

Wealth Manager on Twitter