The previously sluggish Fidelity MultiManager Growth Portfolio has become a first-quartile performer as it responds tactically to market trends under its lead manager, Ayesha Akbar.
The Fidelity multi-manager team has undergone substantial changes in the past two years.
While the poor long-term performance of the Fidelity MultiManager Growth Portfolio illustrates the thinking behind the alterations, 2010 was the year in which discussion had to translate into performance.
It will no doubt be gratifying for Ayesha Akbar, who took over as lead manager of the fund in February 2010, to note that the portfolio is first quartile over six and 12 months, according to Financial Express.
“It’s been about two years since I started looking at the Growth fund,” Akbar says. “The fund was in good shape by the start of last year.” (article continues below)
While short-term performance figures should be treated cautiously, it is nevertheless a positive sign that the fund has dragged itself from fourth quartile over both five and three years to returning 14.09% against an average Investment Management Association (IMA) Active Managed sector return of 10.53% over one year.
Akbar says that despite the difficulties markets faced last year, the underlying managers in the portfolio were all able to add value.
As such, although Akbar was broadly bearish on Europe, the European allocation within the portfolio produced a positive return over 2010.
“In terms of managers for 2009 you needed to make a big call about whether you wanted to be in risk assets or not, but in 2010 you had to be more stock specific,” she says. “Macro is still important but with volatility picking up it’s a pretty good time to be a stockpicker.”
Indeed, for the year ahead Akbar retains a cautiously optimistic approach to markets, despite continuing concerns over the eurozone economy and growing worries on emerging market inflation.
“Overall my stance at the moment has a growth tilt,” she says. “I’ve taken back some of my allocation to emerging markets and I think the US is currently looking quite attractive. Frontier markets are also looking interesting.”
The test now is to ensure that performance continues to improve so that the longer- term figures begin to reflect the structural reforms that the portfolio has undergone.
Investors will be looking for evidence of a sustained recovery so that the improvement in Fidelity’s multi-manager performance can start being reflected in the flows.