Innehållsförteckning för 1197 från MoneyWeek

“Stocks always go up,” investors liked to insist in the 1980s and 1990s. They didn’t say it quite so much in the 2000s when stocks went down and they had been exposed as bull-market geniuses. Of course, in the very long run, stocks will tend to go up, as shares of corporations can be expected to appreciate with the overall economy. But the very long run – even in the absence of political upheaval, abysmal economic management or war, as the Japanese market has reminded everyone – can be very, very long indeed (see page 4). The Nikkei’s ascent to new highs was widely celebrated by Japan bulls, which we at MoneyWeek have been for a very, very long time – since around 2003, in fact (we are often a…

International corporations have a new home base in Asia, says Michelle Fay Cortez on Bloomberg. Singapore played host to 4,200 regional headquarters for multinational firms last year, far ahead of the 1,336 for rival Hong Kong. Singapore’s better relations with the west and “broader talent pool” have seen it emerge as the natural place to do business in Asia. While Hong Kong’s standard corporate tax rate of 16.5% is a smidge lower than Singapore’s 17%, that figure can fall to 13.5% when you factor in special incentive programmes for certain activities. Many Chinese companies, such as retailer Shein, have opted for Singapore as their base to “hedge geopolitical risks” and make themselves more acceptable in western markets. Starting in the 1980s, Hong Kong benefited enormously as the international gateway into…

In 2022 headlines screamed that impending lithium shortages heralded a crunch in the supply of the batteries needed to power electric vehicles, says Alex Tabarrok in Marginal Revolution. Between the start of 2021 and the peak of the lithium price bubble in November 2022, lithium carbonate prices soared by more than 1,000%. That rise did make batteries modestly more expensive in 2022, but as the chart shows, this was a mere blip in the longer trend of battery prices becoming much cheaper as the technology improves. What’s more, lithium prices then crashed back to earth in 2023 – a reminder that high prices are often self-correcting because they encourage miners to undertake more exploration and find new supply.…

News that the Competition and Markets Authority (CMA) will investigate eight housebuilders over “potentially anticompetitive information sharing” caused their shares to fall by less than 4%, says Lex in the Financial Times. No wonder. Housebuilders “have more to celebrate than fear from the year-long study”. True, the probe “could lead to fines” and developers will also have to “up their game on quality”. But the report blames the “complex planning system” for missed targets. It concludes that land banking, the practice of buying parcels of land for future development rather than immediately developing them, is “more a symptom” than a cause of the housing shortage. It also says any measures to reduce housebuilders’ profitability directly “may create... additional downward pressure on the number of houses being built”. The CMA’s report…

Social-media platform Reddit plans to float on the New York Stock Exchange later this month, marking the first initial public offering (IPO) of a major technology brand this year. Reddit is expected to achieve a valuation of about $5bn. It is launching a so-called affinity programme, whereby a large proportion of the shares on offer will be reserved for the website’s users and moderators. In recent years Reddit produced Wall Street Bets, “the online watering hole for the meme-stock craze”, says Anita Ramaswamy on Breakingviews. Offering users a slice of the shares could create a bullish “echo chamber” reminiscent of the craze, bolstering the group’s valuation.…

● Anglo American CEO Duncan Wanblad (pictured) should look to his predecessor Mark Cutifani for a plan to bolster the sagging share price, says Karen Kwok in Breakingviews. Wanblad is faced with a slump in diamond prices owing to lower Chinese demand and a “yawning conglomerate discount”. Cutifani now chairs Vale Base Metals following the Brazilian mining giant’s move to separate its base metals business, which will benefit from the green transition, from the rest of the group. Vale also sold a 13% stake in Vale Base Metals “to Saudi Arabia and other transition-focused investors. If Wanblad can secure “a similar pot of cash” and establish a new base metals group, which should be worth around $28bn, his “sorely needed revamp might gain some impetus”. ● Abrdn has become a…

“It pains me to admit it, but Hong Kong is now over,” says Stephen Roach, the former chair of Morgan Stanley Asia who now teaches at Yale University. In the 1980s, Hong Kong businesses had “extraordinary energy.” China was beginning to grow, and Hong Kong was “perfectly positioned as the major beneficiary of what turned into the world’s greatest development miracle”, he writes in the Financial Times. The stockmarket reflected this opportunity and was the world’s fourth-largest exchange. But the Hang Seng index has dropped 45% over four years and is up by just 5% since the former British colony was handed back to China in 1997. Hong Kong’s downfall rests squarely on Beijing, says Roach, a long-term bull on China who has more recently turned bearish. A proposed extradition…

project-syndicate.org The US is in good shape with no recession in sight, yet surveys show the public remains gloomy about the economy, says Jeffrey Frankel. The gap between performance and perception has been dubbed the “vibecession” – but what explains it? Various answers have been advanced. Perhaps there is no gap at all and economic indicators are wrong or misleading. Perhaps the gloom results from being too politically partisan. Or from too much news media, which tends to focus on the negative. Perhaps inflation is hurting lower-income households, even if the average American is doing okay. Some of these explanations are more credible than others, but the most persuasive is simply that perceptions lag reality. It takes an estimated two years for a change in inflation to have three-quarters of…

■ About 12% of the money on retail-broking platforms Hargreaves Lansdown and Interactive Investor is allocated to investment companies and trusts, says CityWire. The Association of Investment Companies notes that the two brokers jointly hold 12% of the sector on behalf of private investors. Hargreaves holds £12.2bn of investment companies, 6.9% of the UK sector’s market value. This is followed by Interactive with £10.5bn, or 5.9%, which eclipses the combined market values of rivals AJ Bell, Charles Stanley and Halifax Share Dealing. The global equity-income sector was private investors’ favourite category, where they accounted for 49% of the shares. Alternative investments (such as renewables and infrastructure) have boomed in recent years as investors sought income amid low interest rates. However, private investors own just 9% of companies focused on alternatives,…

It has been a decade since the high-income child benefit charge was introduced, and there is speculation that this widely reviled tax could be scrapped in the Budget. The high-income child benefit charge forces some families to pay back some, or all, of the child benefit they receive from the government. If either parent earns £50,000 or more a year, the amount of child benefit they receive per child gradually tapers away. If one parent earns more than £60,000, they get no child benefit entitlement at all. The two main problems are how complex the charge is and how unfair the rules around it are. For example, two parents earning £49,999 are entitled to the full child benefit, despite having a household income of almost £100,000. But another household with…

Transferring your pension to a new provider makes it easier to keep track of your retirement planning – particularly if you move jobs regularly and end up with multiple pots of savings. However, too few savers are aware of the potential pitfalls to watch out for when transferring pensions, and that could cost them tens of thousands of pounds. The biggest problem, according to a survey from People’s Partnership, is that savers have little idea about the cost of different pension plans: 72% of savers who have recently transferred a pension do not know what charges they are now paying and how this compares with their previous arrangements. Beware the charges That’s a real problem, with many people underestimating the long-term impact of even small differences in pension charges. For…

When legendary investor Warren Buffett’s conglomerate Berkshire Hathaway recently released earnings, it rounded off a week in which microchip-maker Nvidia had trounced expectations with its results, helping to propel US stocks to new all-time highs. It was a timely coincidence. While Nvidia grows at a blistering pace because anyone who fears being left behind by artificial intelligence (AI) wants the superfast processing power that its chips deliver, Buffett reminded us that there are always new trends, but consistent investment success is a long game in which patience pays. Long-term investors need to back the breakthroughs in technology that are changing our lives, but they also need the sort of established and dependable businesses that Berkshire Hathaway champions. The road to riches Holding Berkshire’s stock certainly hasn’t done anyone’s long-term wealth…

The Showman Inside the Invasion That Shook the World and Made a Leader of Volodymyr ZelenskySimon ShusterWilliam Collins, £22 At a time when elected leaders in the West are behaving like clowns, it is ironic that it has taken Ukraine’s president, a former comedian, to remind us what a true statesman looks like. Defying predictions that Ukraine would rapidly fold in the wake of Russia’s invasion, Volodymyr Zelensky managed to marshal a response that stopped Putin’s army in its tracks and even managed to regain some of the territory lost to a previous invasion. Two years on, the war continues, and there are doubts over whether Ukraine can continue to rely on the support of the US and Europe. Yet Ukraine’s position is far better than many would have initially…

Working a four-day week benefits workers’ physical and mental health and helps to foster a better work-life balance, says Rachel Hall in The Guardian. It also reduces burnout and staff turnover, according to the world’s largest trial of the arrangement by Autonomy, a think tank, and a trio of British and US universities. Of the 61 British firms that took part in a six-month pilot in 2022, 54 said they were sticking with the policy a year later, while around half of bosses reported a positive effect on their businesses. Perhaps unsurprisingly, 96% of staff said their personal lives had improved, 86% felt they worked better, 38% said it improved efficiency, and 24% said it helped with caring responsibilities. But critics say it won’t work for every company. “Challenges” also…

It took chip giant Nvidia 24 years “to reach the rarefied air” of $1trn in market value, says Asa Fitch in The Wall Street Journal. But its role in “powering the AI [artificial intelligence] revolution” meant that reaching a second trillion only took eight months. The reason its shares have reached such “lofty heights” is the latest earnings report, which revealed quarterly sales of $22.1bn and forecast another $24bn for its current quarter. Each figure represents an increase of more than 200% from the year before, beating Wall Street’s bullish expectations. As a result, Nvidia’s shares have gained 59% in 2024 after more than tripling in 2023. Nvidia is doing so well because it “is at the heart of the AI gold rush”, with those developing the technology “relying heavily…

Five to buy BHP Group Investors’ ChronicleChronically weak nickel prices are complicating the mining industry’s pivot towards the energy-transition metals. An ongoing supply glut of electric-vehicle battery component nickel from Indonesia recently forced a $2.5bn impairment charge on BHP’s Western Australia nickel operations, with management even considering mothballing production. Still, nickel is only a small part of the group’s metals portfolio, with resilient iron ore and copper prices helping lift performance in the second half of last year; the red-metal market is tightening. 2,327p BP The TelegraphShares in this oil giant have rebounded but there should be more to come. Management has pledged to “be more pragmatic in its investment decisions” about the pace of energy transition after previous pledges irritated investors. A 4.8% dividend yield plus generous share buyback…

Pressure is mounting on Commons speaker Lindsay Hoyle, says Dominic Penna in The Telegraph. Nearly 100 MPs have signed a motion for him to quit. Hoyle (pictured) was forced to “repeatedly apologise” amid “chaotic” scenes last week when he “breached decades of convention by selecting a Labour amendment to an SNP motion on Gaza”. Hoyle compounded his problems by claiming that the decision, which meant that MPs were unable to vote on the SNP’s calls for an immediate and unconditional ceasefire, was motivated by concerns for the safety of MPs, who have faced “growing threats from pro-Palestinian protesters”. Hoyle’s fears were not irrational, says Robert Shrimsley in the Financial Times. It’s well known that Labour MPs “are facing threats at home if they continue to stick with the official party…

Sometimes in a portfolio review, you need to admit that there were points when you consistently got it wrong. And so it is with our exchange-traded fund (ETF) portfolio. We have two holdings left to consider and both involve mistakes for which I kick myself. We’ll consider the dilemma of our UK mid-cap holding shortly, but first let’s look at the property position. The 10% allocation to commercial property has been in the portfolio from its earliest days in 2013, through ETFs that mostly invest in real-estate investment trusts (Reits). The argument for having some property is that this is a real asset (see below) with different characteristics to bonds or stocks. Reits don’t perform exactly like direct property investments – often they will behave more like stocks – but…

Why is Britain not working? Kate Andrews The Spectator If workforce participation in Britain had remained at the 2019 rate, the economy would now be 1.7% larger, rather than shrinking, says Kate Andrews. Before the first lockdown, workforce participation was 79.5%, the highest since records began. Today, 5.6 million are out of work and – crucially – not looking for a job. The national character can’t have changed in that time, so what explains it? Mental illness is a big part of the problem. In all, 53% of those registered as long-term sick in January 2023 did so for depression, nerves or anxiety; most will have been signed off work. The waste of human potential is a “scandal”, as is the cost. The expected rise in welfare costs alone equals…

prospectmagazine.co.uk Forty years ago, Steve Jobs unveiled a “truly revolutionary” new computer, says Ethan Zuckerman. Before the Apple Mac, computers were for accountants and engineers, and featured blocky, pixelated green or white text on a black background. But why should you have to type in cryptic commands to make a machine do what you want? Why not point and click? And why couldn’t they look “cool”, be associated with creativity and fashion, be “friendly and welcoming”? Jobs made it so. He repeated the trick with the iPhone, which like the Mac took preexisting technologies but put them in a new user-friendly format. None of his products made demands on consumers, and the technical wizardry underpinning his devices was so well hidden that now even computer-science students are shocked to discover…

As credit markets have adjusted to the higher interest-rate environment over the past 12 months, it has become possible to earn equity-like returns from credit, particularly in the higher-risk and more esoteric sections of the credit markets. The ICE BofA US High Yield Index, an index of corporate debt not ranked as investment grade, currently yields about 7.4%, though it hit a high of 9.5% last year. Even higher returns are available for investors willing to take more risk. According to ICE BofA, the bottom rung of the credit ladder (bonds rated C or below) is yielding 13.6%. In the private credit and distressed-debt markets, yields are far higher as lenders hold all the cards. Secured lending In the UK, investors can access these higher yields through investment trusts and…

The energy-price cap is set to fall to its lowest level in two years in April. The maximum amount energy firms can charge per unit will fall by 12.3% from the current level, saving the average household £238 a year. Ofgem, the energy regulator, sets the cap, which limits how much suppliers can charge you per unit of gas and electricity. The average household will pay £1,690, assuming they are a dual-fuel household paying by direct debit. But remember this is based on average energy consumption. The cap is on the unit charge; the more you use the more you will pay. “Wholesale gas prices have fallen as a mild winter in Europe reduced demand, helped by plentiful supplies of liquefied natural gas in Europe and Asia,” says Alex Lawson…

The extension of the age at which savers can access their private pensions could cause problems for people in ill health, advisers warn. From April 2028, savers will have to wait until the age of 57 to access their pensions, up from 55 today. But that could increase the number of people who can no longer work owing to medical problems but who can’t get at their pension savings, either. Special rules do apply to savers in ill health. Where savers can produce evidence of their medical difficulties, HM Revenue & Customs guidelines allow pension providers to grant them early access to their money. However, the HMRC guidelines set out minimum criteria. Some pension providers, particularly employer-run schemes, may have more demanding rules. The worst-case scenario is that savers access…

On a bus ride in 2015 in Beijing with other global business leaders, Blackstone chief executive Steve Schwarzman (pictured) happened to sit down next to Jack Ma, co-founder of Chinese tech giant Alibaba, says Miriam Gottfried in The Wall Street Journal. Their conversation led to Schwarzman, 77, becoming an “unlikely champion” of artificial intelligence. Ma convinced him AI would revolutionise drug development and education, and reshape how people in all industries do their jobs. Nine years later, Schwarzman might be the biggest individual funder of AI education and research, pledging more than half a billion dollars to the effort. He lobbied in Washington to help secure the passage of the Chips and Science Act of 2022, which boosted funding in areas such as AI and quantum computing. He has pushed…

2018 Piesporter Goldtropfchen, Riesling Spätlese, Mosel, Germany £23, thewinesociety.com Next Wednesday, 6 March, The Wine Society celebrates its 150th Anniversary by launching a one-off collection of fine wines from some of the world’s most iconic estates. Relationships form the heart and soul of the wine business, and it is the forging of genuine friendships that makes this one of the most worthwhile careers. I tasted a small selection of the wines selected for this initiative, and it is clear that The Wine Society has thrived for a century and a half because of its steadfast commitment to great wineries. My headline wine comes from Reichsgraf von Kesselstatt and is a stunner. I remember my wife, Amelia, who also works in wine, recounting a story many years ago of a wonderful…

The Ownership Dividend The Coming Paradigm in the US StockmarketDaniel Peris Routledge, £31.99 Over the past few decades, the idea that companies should pay dividends to shareholders has sometimes come under attack. Academics argue that it is better for companies to retain their earnings and invest for growth, leaving investors who want to realise gains to sell their shares – dividends are, in addition, generally taxed at a higher rate than capital gains. Some investors even claim that dividend payments are a sign of corporate weakness, as they indicate a lack of investment opportunities. Covid seemed to deal the final blow, as many companies were banned from paying dividends. Most of those that were have, however, now resumed payments, and even Meta (Facebook’s parent) has started to pay out. Is…

“Boeing is a quintessential example of America’s rotting business culture over the past 40 years. The company relentlessly disgorged cash to shareholders when it could’ve spent it on building a better (and safer) product... from 1998 to 2018, Boeing did $61bn worth of share buybacks to pump its stock price [even as] staff [were] asked to penny-pinch... Until the 1970s... corporations were... considered parts of a community with responsibilities to... employees... the communities that house them [and to] customers... But then Washington decided that [US business culture] needed a shakeup... Rule changes... allowed companies to repurchase their own shares, a practice that was previously considered stock manipulation... Money that could have been spent investing in workers or products instead went straight to investors.”…

Shares in Rolls-Royce jumped by 10% last week after it announced that its annual earnings more than doubled last year and forecast further growth in 2024, says Sylvia Pfeifer in the Financial Times. The unexpectedly good results saw underlying operating profits rise by £938m to £1.6bn and sales climb to £15.4bn, while cash flow reached a record £1.38bn. This rounds off a “remarkable” year, which saw the group go from being called a “burning platform” by new CEO Tufan Erginbilgic to producing the best performance in Europe’s Stoxx 600. Is Rolls-Royce’s rapid turnaround due to Erginbilgic or has he just “timed his arrival to perfection” by joining just before the “post-Covid upswing in aviation?”, asks Alistair Osborne in the Times. Predecessor Sir John Rose argues that credit should be given…

Sweden’s medical-devices group Arjo has bounced back from Covid, when restrictions reduced orders, says WirtschaftsWoche. Last year’s 10% sales increased to roughly €978m, returning the company to its long-term growth trajectory, which is being underpinned by the ageing of the global population. By 2050 the worldwide total of over-80s will have doubled, according to the World Health Organisation, so plenty more products such as hospital beds, specialised mattresses and walking aids will be needed. A restructuring programme has just been completed and debt is on the way down, so the bottom line should jump to between €50m and €55m this year, up from €43m in 2023.…

Politics & economics A “waiting game” of nearly two years ended on Monday when the Hungarian parliament voted in favour of Sweden’s Nato membership, making the country the alliance’s 32nd member, says Miranda Bryant in The Guardian. Alarmed by Russia’s invasion of Ukraine, a non-Nato member, in February 2022, Sweden rapidly sought the embrace of Nato’s collective defence pledge. However, admission requires the unanimous support of the alliance’s members. Hungary stalled for 19 months. The decision by Hungary’s prime minister, Viktor Orbán, to allow a vote followed a visit to Budapest by Swedish prime minister, Ulf Kristersson, during which it was announced that Sweden would provide Hungary with four Swedish-made Gripen jets and that the manufacturer, Saab, would open an AI research centre in Hungary, says Andrew Higgins in…

After Donald Trump’s victories in the South Carolina and Michigan primaries, punters seem to think the contest for the Republican nomination for US president is all but over. With £5.7m matched on Betfair, Trump is 1.09 (91.7%) to win the nomination, with the last serious remaining candidate, Nikki Haley, out at a distant 26 (3.8%). Incumbent Joe Biden is having a bit more trouble convincing punters, but even he is at 1.38 (72.4%) to be the Democratic candidate, with Michelle Obama now at 11 (9.1%). I’ve said before that I think the markets are underestimating the chances of Biden getting the nomination. Barring some unexpected health problem, he seems determined to carry on, and his control of the delegates to the convention will make some sort of last-minute coup attempt…

Over the past couple of years we have all become familiar with “greedflation”. With inflation rising to levels not seen since the 1980s, prices were obviously going up, but it seemed to many people that they were going up at an accelerating rate, and by far more than was necessary. Indeed, plenty of left-leaning economists started to argue that ruthless corporations determined to make more and more money were the main reason inflation was so high. A few even argued for price controls. It was hard not to have some sympathy. Energy and labour costs had clearly risen, and lockdown snarled up supply chains, so most companies had to push up prices just to stay afloat. Yet a generation of managers who had never witnessed sustained inflation before – given…

The term “real assets” is most commonly used to refer to physical assets, as opposed to financial assets whose value comes from a contractual claim. Traditional examples of real assets include real estate (both residential and commercial), natural resources (energy, mining and agriculture) and infrastructure (transport, utilities and telecoms). In contrast, stocks and bonds are considered to be financial assets. When you buy one of these, you don’t own something tangible, although the business or loan might in turn be backed by a physical asset. Some assets – such as index-linked bonds – can be expected to deliver real returns (ie, returns explicitly linked to inflation), but are not generally referred to as real assets under this definition. There are three main benefits that real assets can bring to a…

“I am a marvellous housekeeper. Every time I leave a man, I keep his house.” The late Hungarian-American socialite and actress Zsa Zsa Gabor (pictured), quoted in San Diego Jewish World “I wish! If it was, I’d have made a tonne of money. But no, that [sort of thing] was really frowned upon back then. It was in Wyn Cooper’s poem, Fun, which inspired the song, although funnily enough I’m from Missouri where Budweiser is made, so it was my beer of choice.” US singer Sheryl Crow denying that mentioning Budweiser in her 1994 hit All I Wanna Do was a paid product placement, quoted in The Guardian “All the happiness in the world can’t buy you money.” Late US country-music singer Toby Keith, quoted in The New York Times…

wsj.com Our refrigerators, washing machines and ovens can do more than ever before, says Rachel Wolfe. But there’s a downside to all the “snazzy features”. The machines cost more – and yet are more prone to breaking down. Computerisation, a rise in the number of components and flimsier materials are all making the kit less reliable. Newer devices are also harder and more expensive to fix. Such machines used to rely mostly on straightforward mechanical parts. In the past decade or so, they’ve been replaced with sophisticated electrical and computerised parts – a touchscreen, say, that displays a dozen different sensor-controlled wash options. Even if technicians can figure out what’s gone wrong, the bill tends to be so high that it’s more economical to replace than repair. One who has…

Kelso Group’s CEO John Goold and CFO Mark Kirkland have joined the board of books and stationery retailer The Works, says City AM. The activist investment firm is seeking to help “restore the intrinsic valuation of The Works”, which it believes is “much higher than the current share price reflects”. The shares trade at 26p. The move comes after The Works posted a pre-tax loss of £14.8m for the six months to 29 October 2023, as the retailer struggled with higher costs owing to inflation and depressed demand from consumers. Kelso first snapped up a 3.2% stake in The Works, which has a market value of £16.3m, last September, and a month later revealed a 5.1% holding. Both Goold and Kirkland have experience working with small firms.…

With America’s S&P 500 index trading above 5,000, even the bulls are starting to suffer from vertigo. Goldman Sachs has raised its end of 2024 target to 5,200, just 4% higher, while stockmarket veteran Ed Yardeni’s target of 5,400 leaves another 8% to go. But there are still ten months of the year left. On a prospective multiple of 20 times this year’s earnings, the S&P 500 is expensively priced, unless you believe bond yields are heading significantly lower, which is very unlikely. Inflation looks likely to surprise the pessimists by falling to 2% in the US, the UK and Europe, but huge budget deficits and the lack of a corresponding pool of savings suggests that ten-year yields are likely to stabilise at about 4% and may go higher. Admittedly,…

● A survey by the consumer group Which has found that many people are struggling to enact power of attorney after a loved one becomes unable to manage their finances themselves. Many banks and building societies are making it difficult to register the documents. They need to be filed with every financial firm the person has an account with. “Yet each bank has a different process for registering,” says Claer Barrett in the Financial Times. “Some will let you do so fairly painlessly online; others demand forms are posted and some require attorneys to attend an in-branch appointment – something that’s becoming harder with the dwindling numbers of bank branches.” The survey established that Coventry Building Society and Nationwide were the easiest to register documents with. Co-operative, Post Office Money…

● Sales of annuities rose by 14% last year, financial platform Hargreaves Lansdown says, with pension savers flocking to take advantage of higher rates of income as interest rates have increased. Sales of annuities are now back to levels not seen since before the pension-freedom reforms of 2015. While income-drawdown plans remain a popular way for savers to take income in retirement, offering more flexibility and control, the fact that annuities now pay as much as 7.1% a year in income has seen many savers gravitate towards the guaranteed lifetime nature of the product. ● Nest, the UK’s largest workplace-pension provider, is to launch a new £5bn fund for savers who want to invest their pension contributions based on environmental and social governance (ESG) concerns such as climate change. The…

Despite ongoing bearish sentiment towards Chinese equities, we see significant opportunity. Valuations are near record lows, particularly compared with markets such as the US. While economic fundamentals are tepid, we perceive signs of gradual improvement, supported by increased government easing measures, with a particular focus on the troubled property sector. Since the strategy’s launch in 2010, the Fidelity China Special Situations investment trust has offered direct exposure to China’s growth story, from well established and widely recognised companies through to entrepreneurial small and medium-sized ones, and even new businesses that have yet to launch on the stockmarket. At present the portfolio is exposed to a number of investment opportunities in the industrial sector, which is being driven by ongoing innovation supported by investment in research and development (R&D). Many strong…