Notification of change to the underlying fund of R91 Fidelity Multi Asset Open Strategic (GBP)
27 Jan 2023
Notification of change to the underlying fund of R91 Fidelity Multi Asset Open Strategic (GBP) (the "Affected Mirror Fund")
We have received notification from Fidelity International of an upcoming change to the to the investment policy of the underlying fund of the Affected Mirror Fund. These changes will take effect from 29 March 2023 (the “Effective Date”).
Currently, the portfolio managers of the underlying fund must invest more than 65% of the underlying fund within an Irish UCITS fund - the Fidelity Common Contractual Fund II (CCF II). As of 29 March 2023, the underlying fund manager will be removing this minimum threshold to enable them to utilise a more diverse range of underlying investments. The Company believe this added flexibility will enable them to deliver enhanced outcomes for investors across a range of market conditions.
The CCF II will remain an important component of the underlying fund, but the underlying fund portfolio manager will be able to complement existing exposure with other actively managed and index tracking funds managed by Fidelity and other third parties.
The transition to more diverse portfolios is expected to take 24-36 months to complete in the most efficient manner. The Company expect over time these changes to provide greater value for investors, with the long-term aim of passing on cost savings through lower ongoing charges. The Company have stated that there will be no change to the investment approach and the outcome of the underlying fund will remain the same. There is also no anticipated change to the risk profile of the underlying fund.
There will be some transitional costs incurred as a result of making these changes, although they are not expected to exceed 0.17% of the underlying fund total value. The underlying fund (and therefore the investors of the underlying fund) will incur these transitional costs. As noted above, the realignment will be gradual and integrated into the trading activity for the underlying fund.
Please refer to the Appendix opposite for full details of the revised Investment Policy of the underlying fund of the Affected Mirror Fund.
Policy holders do not need to take any action as a result of the change if they wish to remain invested in the Affected Mirror Fund.
We recommend that policyholders seek the advice of their usual financial adviser before making any investment decisions.
Should you have any questions regarding these changes, please contact the Investment Marketing team.