Fidelity Emerging Markets (FEML)

Fidelity Emerging Markets Limited (FEML) is managed by Nick Price and Chris Tennant, two experienced investors who apply a disciplined, research-driven approach to identifying attractive investment opportunities across emerging and frontier markets. Their philosophy for long positions focusses on companies with strong cash generation, resilient balance sheets and governance aligned with minority shareholders, whilst using short positions to target businesses with fundamental vulnerabilities.

Over the past 12 months to 30/09/2025, FEML has delivered standout results, achieving a NAV total return of 34.3%, more than double the MSCI EM Index’s 16.9%, and a share price return of 40.3%, reflecting its narrowing discount. Notably, much of this strength has come in the last six months, with stock selection a key driver of Performance. Materials holdings such as Pan African Resources, AngloGold Ashanti, Endeavour Mining and Peru’s Buenaventura were among the top contributors, supported by solid operational momentum and strength in gold and copper prices. Technology names, notably Taiwan’s Elite Materials, also performed strongly. Not everything worked, however, as weakness in select financials, including India’s ICICI Bank and Five Star Business Finance, Kazakhstan’s Kaspi and Georgia’s TBC Bank, weighed on relative returns.

Many emerging markets rebounded sharply from the initial tariff-driven sell-off following Liberation Day. Renewed optimism around domestic demand, governance reforms and regional trade has fuelled a sharp recovery. FEML’s positioning among long positions in high-quality, cash-generative businesses has captured this rebound effectively, underlining the value of its differentiated approach. Over the year, the managers used recent market deratings to add selectively to quality names in the long book, including TSMC and Elite Materials, and also added several new short positions in companies with weakening fundamentals and over-levered balance sheets (see Portfolio).

At the time of writing, FEML trades on a 8.9% Discount, narrower than its five-year average of 11.6%.