Fidelity International is expanding the investment universe of its Emerging Europe, Middle East and Africa fund to include global emerging markets as it becomes part of the asset manager’s sustainable fund range.
Effective from 23 March, the fund will be re-named the Fidelity Sustainable Emerging Markets Equity Fund, and the fund’s investment policy will change.
Fidelity’s sustainable fund range applies ESG-related exclusions and screens to ensure that at least 70% of the fund’s portfolio will be invested in companies which “maintain strong sustainable characteristics”.
The rebranded fund will have the ability to hold up to 30% in lower ESG-rated stocks, as long as the managers believe there is an improving ESG outlook, as flagged by Fidelity’s proprietary ESG research, Fidelity said.
Additionally, the Fidelity Sustainable Emerging Markets Equity Fund will have a new and differentiated investment policy to the previous fund, with a portfolio of 30 to 50 holdings.
The fund’s comparative index will change from the MSCI Emerging EMEA Capped 5% Index to the broader MSCI Emerging Markets Index. There will be no changes in fees.
According to Fidelity, portfolio management of the fund will move to Amit Goel, Punam Sharma, and Sherry Qin, who use a “collaborative approach” involving interaction with the wider emerging market portfolio management team members.
The Fidelity Emerging Europe, Middle East and Africa fund was managed by Nick Price, Chris Tennant and Zoltan Palfi, according to Fidelity’s website.
The Fidelity Sustainable Emerging Markets Equity Fund aims to provide long-term capital growth.
Russell Lancaster, head of intermediary sales, UK wholesale at Fidelity International, said: “We believe the launch of the Fidelity Sustainable Emerging Markets Equity fund helps us meet our growing client demand for investing in sustainable businesses within emerging equity markets.”
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