Fidelity Special Values PLC (LON:FSV) has published its monthly factsheet for August 2025.
Portfolio Manager Commentary
UK equities extended their gains in August, marking the fourth consecutive month of positive performance. This was supported by resilient corporate earnings and expectations surrounding a potential ceasefire in Ukraine. The Bank of England delivered a 0.25 percentage point rate cut, reducing the base rate to 4%, in what was widely seen as muted policy easing. Meanwhile, inflation accelerated unexpectedly to 3.8% in the 12 months to August 2025. At the sector level, telecommunications, healthcare and basic materials outperformed, while technology lagged amid growing investor caution around the disruption and profitability from AI-related investments.
The UK has been performing well over the past five years and remains a fertile hunting ground for contrarian stock pickers. However, the fact that UK shares have performed solidly over the last five years has largely gone unnoticed, particularly among domestic investors who continue to withdraw money to allocate overseas. This created a situation where investors were withdrawing capital precisely when performance improved. Importantly for investors, strong returns are available outside of the US. While there has been some narrowing in regional valuations following the strong year-to-date performance, the UK has room to run further, continuing to trade at a meaningful discount to other regions.
On a rolling 12-month basis, the Trust recorded NAV and share price returns of 14.3% and 21.8% respectively, compared to 12.6% 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.
