UK investment trust, Fidelity Special Values achieves 18.5% annual return

Fidelity

Fidelity Special Values PLC (LON:FSV) has published its monthly factsheet for May 2025.

Portfolio Manager Commentary

UK equities rallied in May, supported by a series of constructive trade developments. Markets responded positively to an early breakthrough in UK-US trade talks that led to an agreement to remove the 25% US levy on UK steel and aluminium imports, alongside a significant reduction in tariffs on UK-made cars, from 27.5% to 10% on the first 100,000 vehicles exported every year. At the same time, the UK reached a wide-ranging agreement with the EU. Meanwhile, the Bank of England (BoE) cut interest rates by 25 bps to 4.25%. At a sector level, cyclical sectors such as industrials and basic materials led the market.  

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.  

On a rolling 12-month basis, the Trust recorded NAV and share price returns of 13.6% and 18.5% respectively, compared to 9.4% 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.

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