Fidelity to address “significant premium” on China investment trust

Fidelity is considering ways to satisfy the rising demand for Anthony Bolton’s China Special Situations investment trust, which is now trading at a 13% premium to its net asset value.

Anthony Bolton
Anthony Bolton

A statement from the trust says: “Due to the consistently high levels of market demand, the shares of the company are currently trading at a significant premium to their net asset value. The board are therefore currently considering ways in which this demand can be satisfied.”

Simon Elliott, an analyst at Winterflood Investment Trusts, says the trust is likely to issue additional shares. (article continues below)

He says: “For a company that is consistently trading at a premium – driven by retail demand – for the board to consider doing an additional share raising would be our general expectation. Normally what you would see would be a C-share issue done at a small premium to the share price. This could even provide a small incremental uplift to the net asset value of the fund.”

Shares of the investment trust dropped by 1.2% to 123p by close of trading yesterday.