The market capitalization of emerging-market companies has grown nearly twelve fold over the last 10 years, relative to other global stock categories, notes Fidelity Investments. And investors and financial advisors alike are increasingly considering regional funds as potential building blocks for a diversified investment portfolio. To facilitate this trend, Fidelity is launching a new international equity fund — the Fidelity Emerging Europe, Middle East, Africa (EMEA) Fund with retail and advisor share classes.
The Fidelity EMEA Fundo Ticker: FEMEXo Expense Ratio: 1.42%o Minimum Investment: $2,500o Portfolio Manager: Adam Kutas
“Emerging markets have grown significantly in recent years, and — if long-term growth forecasts are accurate — these markets could advance beyond the 12 percent share of the global equity market that they now comprise,” says Sanjiv Mirchandani, president of Fidelity Personal and Workplace Investing Growth Business. “By launching a first-of-its-kind equity fund for U.S. investors dedicated to emerging Europe, Middle East and Africa markets, we’re working to help those with high risk tolerances and long-term outlooks gain targeted exposure to areas of the world that may be under-represented in their portfolios.”
Fidelity EMEA Fund aims at capital appreciation and normally will invest at least 80 percent of its assets in securities of emerging Europe, Middle East, and Africa issuers and other investments tied economically to the EMEA region, the investment company explains. The fund will compare its performance to the MSCI Emerging Markets Europe, Middle East and Africa (or MSCI EMEA) Index.
The EMEA region includes 80-plus countries, from Russia and Eastern Europe to the Middle East and the entire African continent, and more than 1.5 billion people. It is home to one of the fastest growing and rapidly urbanizing populations in the world and contains most of the world’s proven oil reserves and natural resources, Fidelity explains.
Adam Kutas, a 12-year Fidelity veteran who previously co-managed Fidelity Latin America Fund, manages the fund from Fidelity Management and Research Company’s London office. “A few factors have combined to give us confidence that, indeed, EMEA represents a bonafide investment opportunity for certain clients,” says Kutas.