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Continuing our deep dive into our favoured funds and trusts, today we are looking at Fidelity Special Values PLC. It is one that takes a contrarian approach to the UK market, focussing on overlooked and undervalued companies across the full market-cap spectrum. Co-managed by Alex Wright and Jonathan Winton, their rigorous analysis, backed by Fidelity’s vast resources, has led them to increase exposure to more defensive sectors and domestically orientated ones. The company has a strong bias towards value stocks and much more so than its peers and benchmark.

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A feature of the trust is its leaning towards small and mid-cap stocks which provides investors with a differentiated exposure to the UK market compared to an index-tracker or other active strategies that focus on growth. Both managers are encouraged by improving corporate earnings and consider valuations to remain attractive, with UK equities trading at a discount to other major equity markets and the trust itself offering valuations more attractive than the index.

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Over the last five years the trust has not only outperformed the FTSE All Share, but also the S&P 500 and the Nasdaq*.  The trust has increased its dividend for 15 years in a row and currently stands at 2.63%. **  

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At the back end of last year, the managers bought into Tesco and Astra Zeneca, whilst adding to Reckitt Benckiser and National Grid. This year has seen purchases of Frasers Group, owner of numerous brands such as Gieves & Hawkes and DFS – so now you know where you must buy your next suit or sofa!

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Information provided by Fidelity Special Values PLC and Kepler Trust Intelligence, May 2025.

*FE Analytics 01/05/2020 to 31/05/ 2025

**AIC

Past performance is no guarantee of future returns and the value of the investments can fall as well as rise.

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Comments from James Scott-Hopkins, Founder, EXE Capital Management.

The views are those of the author only. The above does not constitute a recommendation to buy the fund and advice should be sought from your financial advisor as to the appropriateness of this fund in your portfolio. The value of investments can fall as well as rise. Past performance is no guarantee of future returns.

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