# Fidelity Special Values: UK valuations and higher dividends offer better returns

- Link: https://www.directorstalkinterviews.com/fidelity-special-values-uk-valuations-and-higher-dividends-offer-better-returns/4121108787
- Published: 2023-03-06T12:17:15+00:00
- Author: Amilia Stone

**[Fidelity Special Values PLC](https://www.directorstalkinterviews.com/company/fidelity-special-values/fsv.l)**(
[LON:FSV](https://www.directorstalkinterviews.com/company/fidelity-special-values/fsv.l))
monthly factsheet for the period ending 31 January 2023

**Portfolio Manager Commentary**

UK equities started the year on a positive note. Prospects of moderating inflation
along with better corporate earnings drove stocks higher, as investors held out 
hopes for slower interest rate rises. Investors also continued to bet that China’s
easing of COVID -19 restrictions will create additional demand. Reduced concerns
around energy shortages in Europe bolstered optimism. At a sector level, investors
favoured consumer discretionary and financials.

The environment is likely to remain uncertain for companies and consumers in need
to refinance their debts. The relative attractiveness of UK valuations and the large
divergence in performance between different parts of the market continue to create
good opportunities for attractive returns. In our opinion, the UK market with its
higher dividends offers a better prospective return than from many other asset classes,
including global equities. M&A activity has been unprecedented over the past couple
of years mostly involving private equity players and US based corporates willing
to pay prices based on US valuations. While rising rates have dulled the ability
of private equity groups to borrow, we are likely to continue to see bids from US
and North American corporates, whilst most private equity funds have got cash to
invest.

On a rolling 12-month basis, the Trust recorded NAV and share price returns of 5.4%
and -4.5% respectively, compared to 5.2% for the index.

[FSV-Jan-Factsheet](https://www.directorstalkinterviews.com/wp-content/uploads/2023/03/FSV-Jan-Factsheet.pdf)
[Download](https://www.directorstalkinterviews.com/wp-content/uploads/2023/03/FSV-Jan-Factsheet.pdf)

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.

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