Proposed merger of Fidelity International fund with Fidelity Open World fund

12 August 2014 - Fidelity has written to shareholders in the Fidelity International fund, proposing to merge the fund with the Fidelity Open World fund. Votes should be received no later than 11am on 6th October 2014 and, if the vote is in favour of the merger, it will take place on 28th November 2014.

Following a recent review, the company has concluded that the limited range of investment options offered could restrict the fund manager's ability to deliver performance in the future and therefore believe a merger is the best option.

The Fidelity International fund, currently rated a 'hold' by Chelsea, targets long-term capital growth from a diversified portfolio of large-cap global equities. At least half the portfolio is invested in companies within the European Union, with the balance invested in the world’s major equity markets.

The Fidelity Open World fund, which was launched last year and currently has just £9m assets under management, is a multi-manager fund, investing in a wide range of (mainly) equity funds – actively-managed, index funds and ETFs.

Fidelity estimates that, due to the Open World fund investing in third party investment funds, the annual overall costs will increase for Fidelity International fund investors if the merger goes ahead.

The two funds are significantly different in our view. If the merger does go ahead, those who remain invested in the fund need to be confident they are happy with the changes. If not, and you wish to switch, feel free to consult the Chelsea Selection for other global equity funds which our research team rates highly.

Investors in the fund should have received all the necessary documentation, but if you haven't, please contact the client service team at Chelsea and we can make sure you get all the information you need to make your choice.


Published on 12/08/2014