Fidelity Special Values PLC (LON:FSV) has published its monthly factsheet for October 2024.
Portfolio Manager Commentary
UK equities fell in October. Markets were cautious amid the ongoing conflict between Israel and Lebanon. Concerns over risks of escalation in the region led to a rise in oil prices. Domestic market sentiment was dampened in anticipation of the Autumn Budget. While the Budget itself had a limited direct impact on equities, it put pressure on the Gilt market as the government announced plans for additional borrowing. Uncertainty surrounding the US elections and ambiguity regarding the direction of monetary policy also weighed on sentiment.
Despite their improved performance over recent years, UK equities still look cheap relative to other markets, and reasonable on an absolute basis. We believe that the combination of attractive valuations and the large divergence in performance between different parts of the market create good opportunities for attractive returns from UK stocks on a three-to-five-year view. Although the UK market continues to remain largely unloved by domestic investors, its attractive valuations are being recognised by other market participants such as overseas corporates and private equity firms who have been amongst the biggest bidders in the UK market. Underlining this interest has been the sharp spike in M&A activity which typically benefits the Trust given our focus on attractive valuations.
On a rolling 12-month basis, the Trust recorded NAV and share price returns of 25.0% and 24.7% respectively, compared to 16.3% for the index.
Fidelity Special Values PLC (LON:FSV) aims to seek out underappreciated companies primarily listed in the UK and is an actively managed contrarian Investment Trust that thrives on volatility and uncertainty.
