Fidelity Asian Values plc (LON:FAS) managers, Nitin Bajaj and Ajinkya Dhavale, are willing to be contrarian when building their portfolio of predominantly smaller companies from the bottom up, leading to a trust that often looks and performs very differently to both the index and peer group.
They has delivered very strong outperformance, with the trust notably ahead over five years, despite periods of volatility, and even more so over ten years, with NAV returns over 50 percentage points higher than the benchmark. The benefit of FAS’s contrarian strategy was most evident in late 2024 and early 2025, with the overweight to China, driven by stock selection, gaining from strong performance of Chinese equities over that period. Furthermore, the underweight allocation to India, where the managers struggled to find high-quality companies at attractive valuations, helped relative performance during a period when Indian equities underwent a significant correction.
Further aiding the alpha potential is the trust’s Gearing facility. The managers use derivatives to enhance exposure to their highest conviction positions. Furthermore, the ability to short stocks offers the potential to benefit from falling share prices.
The trust’s share price has also performed well over the past few months. This caused the trust’s Discount to narrow, with it currently being the narrowest in the three-strong Asia Pacific Smaller Companies sector, although this has moved around following the volatility of the US tariffs announcements.
Another notable feature of FAS is the charging structure. This includes a variable element that is designed to return something to shareholders in the event that the managers should underperform their reference index.
Fidelity Asian Values Plc (LON:FAS) provides shareholders with a differentiated equity exposure to Asian Markets. Asia is the world’s fastest-growing economic region and the trust looks to capitalise on this by finding good businesses, run by good people and buying them at a good price.
