Fidelity goes large in South Africa

The new Fidelity International Emerging Europe, Middle East and Africa (EMEA) fund has immediately taken a large overweight position in South Africa. As first revealed in Fund Strategy the fund, managed by Nick Price, launched last week.

The Luxembourg domiciled fund, which invests in 50-70 companies, is benchmarked against the MSCI Emerging EMEA Index (capped 5%).

However, Price is not constrained to this benchmark, allowing him to invest in other countries in the region such as Bulgaria, Estonia, Kazakhstan, Latvia, Lithuania, Oman, Qatar, Romania and the United Arab Emirates.

According to Fidelity, South Africa makes up 35% of the benchmark, and while it would not reveal how much Price (pictured) has invested in the region, it was described as “significantly overweight”. This is partly because over the next three years planned infrastructure spending in South Africa is set to hit $60 billion (£29 billion).

The fund’s initial focus will be to try to profit from the ongoing rise in commodity prices. Price says the EMEA region will be a direct beneficiary of growing demand for oil and commodities from China and India. Despite recent share prices he argues there are still undervalued commodities sector companies in the region.

The fund carries dollar, euro and sterling share classes. The sterling share class has an initial charge of 3.5% and an annual management charge of 1.5%. Minimum investment is £1,000 for lump sum investments and £50 for monthly plans.