annual report and financial statements…under aifmd remuneration disclosure for the financial...
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Annual Reportand Financial Statements
For the year ended 31 October 2019
Fidelity Investment Funds IV
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Contents
Director’s Report* 2
Statement of Authorised Corporate Director’s responsibilities 3
Certification of the Annual Report and Financial Statements by Directors 3
Report of the Depositary 4
Independent Auditors’ report 4
Authorised Corporate Director’s Report*, including the financial highlights and financial statements
Market Performance Review 6
Accounting policies of Fidelity Investment Funds IV and its sub-funds 7
Risk management policies of Fidelity Investment Funds IV and its sub-funds 9
Fidelity Allocator World Fund 11
Fidelity Multi Asset Allocator Adventurous Fund 20
Fidelity Multi Asset Allocator Defensive Fund 29
Fidelity Multi Asset Allocator Growth Fund 39
Fidelity Multi Asset Allocator Strategic Fund 48
Fidelity Multi Asset Balanced Income Fund 58
Fidelity Multi Asset Income & Growth Fund 71
Fidelity Multi Asset Income Fund 83
Fidelity Multi Asset Open Adventurous Fund 99
Fidelity Multi Asset Open Defensive Fund 109
Fidelity Multi Asset Open Growth Fund 119
Fidelity Multi Asset Open Strategic Fund 129
Fidelity Open World Fund 140
Fidelity Select 50 Balanced Fund 150
Portfolio Statements (unaudited)* 159
Further Information* 188
*These collectively comprise the Authorised Corporate Director’s (ACD) report.
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Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Director’s Report
We are pleased to present the annual report and financial statements for Fidelity Investment Funds IV (the “Company”), covering the year to 31 October 2019.
Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities but is included for the purpose of illustration only. Investors should also note that the views expressed may no longer be current and may already have been acted upon by Fidelity.
Company and Status
The Company is an open-ended investment company with variable capital incorporated in England and Wales under registered number IC000712 and authorised by the Financial Conduct Authority (FCA) on 2 October 2008.
The Company is authorised as a non-UCITS retail scheme (NURS) and is an alternative investment fund (AIF) under the AIFM Directive. It is structured as an umbrella company comprising various funds, each of which is operated as a distinct fund, with their own portfolio of investments.
The funds in which shares are currently available are:
Fidelity Allocator World Fund
Fidelity Multi Asset Allocator Adventurous Fund
Fidelity Multi Asset Allocator Defensive Fund
Fidelity Multi Asset Allocator Growth Fund
Fidelity Multi Asset Allocator Strategic Fund
Fidelity Multi Asset Balanced Income Fund
Fidelity Multi Asset Income & Growth Fund
Fidelity Multi Asset Income Fund
Fidelity Multi Asset Open Adventurous Fund
Fidelity Multi Asset Open Defensive Fund
Fidelity Multi Asset Open Growth Fund
Fidelity Multi Asset Open Strategic Fund
Fidelity Open World Fund
Fidelity Select 50 Balanced Fund
In the future additional funds or new classes of shares within the existing funds may be launched by the ACD.
Each fund has the investment powers equivalent to those of a NURS as per the Prospectus.
Shareholders are not liable for the debts of the Company. A shareholder is not liable to make any further payment to the Company after they have paid the purchase price of the shares.
The Company is governed by the requirements of the Open-Ended Investment Companies Regulations 2001 (SI 2001/1228) (“OEIC Regulations”) and the FCA’s Handbook of rules and guidance, specifically the Collective Investment Schemes sourcebook (COLL). As permitted by the COLL, the Company does not hold Annual General Meetings.
The Company has segregated liability status between funds. This means that the assets of a fund belong exclusively to that fund and shall not be used to discharge directly or indirectly the liabilities of, or claims against, any other person or body, including the Company, or any other fund.
Alternative Investment Fund Managers Directive (AIFMD) (Unaudited)
In compliance with the AIFMD, Fidelity Investment Services (UK) Limited (“FISL”) has been appointed the Company’s Alternative Investment Fund Manager (“AIFM”).
The AIFM operates under the terms of Fidelity’s Global Remuneration Policy Statement. This ensures that the AIFM complies with the requirements of the FCA’s Remuneration Code (SYSC19A), the AIFM Remuneration Code (SYSC19B) and the BIPRU Remuneration Code (SYSC19C).
FISL does not employ staff directly so the total remuneration to be disclosed under AIFMD remuneration disclosure for the financial performance year to 30 June 2019 is £nil.
The total remuneration paid to code staff supporting the AIFM (FISL) is €8.88m (£7.97m).
Code staff includes the following individuals:
(a) senior management (Registered Directors);
(b) risk takers (Senior Management team);
(c) staff engaged in control functions (Risk, Compliance, Audit, HR, Finance).
The funds use leverage to increase their exposure to the stock markets in line with the investment objectives. The AIFM has set maximum levels of leverage that are reasonable. It has implemented systems to calculate and monitor compliance against these limits and has ensured that the limits have been complied with at all times.
The maximum leverage limits are 300% for the Gross Method of calculating leverage and 200% for the Commitment Method.
There have been no changes to the maximum level of leverage that the Company may employ during the year.
At 31 October 2019, actual leverage for both the Gross Method and the Commitment Method for the funds are as follows:
Fund name Gross Commitment Method Method
Fidelity Allocator World Fund 101.34% 100.54%
Fidelity Multi Asset Allocator Adventurous Fund 106.88% 101.18%
Fidelity Multi Asset Allocator Defensive Fund 126.97% 115.66%
Fidelity Multi Asset Allocator Growth Fund 113.38% 105.94%
Fidelity Multi Asset Allocator Strategic Fund 120.81% 111.51%
Fidelity Multi Asset Balanced Income Fund 137.48% 98.66%
Fidelity Multi Asset Income & Growth Fund 139.30% 99.14%
Fidelity Multi Asset Income Fund 141.37% 102.68%
Fidelity Multi Asset Open Adventurous Fund 119.95% 106.75%
Fidelity Multi Asset Open Defensive Fund 113.96% 95.36%
Fidelity Multi Asset Open Growth Fund 119.88% 104.94%
Fidelity Multi Asset Open Strategic Fund 116.53% 100.77%
Fidelity Open World Fund 113.32% 107.45%
Fidelity Select 50 Balanced Fund 100.35% 97.95%
The Gross Method is a measure of overall total financial markets exposure and provides insight into the total amount at risk from market fluctuations.
The Commitment Method is a measure (after appropriate netting and hedging) of overall total financial markets exposure and provides insight into the total amount at risk from market fluctuations (after netting and hedging).
Holdings in other sub-funds within the same Company
No sub-fund held shares in any other sub-fund in the same Company throughout the year ended 31 October 2019.
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Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Objectives
The broad aim of the Company is to provide access, both indirectly through investing in other collective investment schemes and directly, to the global research resources and stock picking skills of Fidelity’s investment management teams throughout the world.
Each fund provides the opportunity to benefit from investment in professionally managed pools of securities and other financial instruments in different geographic areas and currencies.
The investment objective and a review of the investment activities of each fund during the year under review are included within the Authorised Fund Manager Reviews.
Changes to the Prospectus
For the year ended 31 October 2019 the following significant changes were made to the Prospectus and Instrument of Incorporation:
• Fidelity Multi Asset Open Adventurous Fund and Fidelity Multi Asset Open Defensive Fund launched A Accumulation Shares on 12 December 2018.
• Fidelity Multi Asset Open Adventurous Fund, Fidelity Multi Asset Open Defensive Fund, Fidelity Multi Asset Open Growth Fund, Fidelity Multi Asset Open Strategic Fund and Fidelity Open World Fund Y Accumulation Shares converted into N Accumulation Shares on 16 January 2019.
• Fidelity Multi Asset Adventurous Fund merged into Fidelity Multi Asset Open Adventurous Fund on 9 February 2019 and was terminated on 30 April 2019 therefore no financial statements have been produced in accordance with the COLL.
• Fidelity Multi Asset Growth Fund merged into Fidelity Multi Asset Open Growth Fund on 9 February 2019 and was terminated on 30 April 2019 therefore no financial statements have been produced in accordance with the COLL.
• Fidelity Multi Asset Balanced Income Fund, Fidelity Multi Asset Income Fund and Fidelity Multi Asset Income & Growth Fund launched N Accumulation Shares on 13 February 2019.
• Fidelity WealthBuilder Fund merged into Fidelity Open World Fund 23 February 2019 and was terminated on 18 November 2019 therefore no financial statements have been produced in accordance with the COLL.
• Fidelity Multi Asset Balanced Income Fund, Fidelity Multi Asset Income Fund, Fidelity Multi Asset Income & Growth Fund Y Accumulation Shares converted into N Accumulation Shares on 1 March 2019.
• Fidelity Multi Asset Balance Income Fund, Fidelity Multi Asset Income Fund, Fidelity Multi Asset Income & Growth Fund Y Income Shares converted into N Income Shares on 1 March 2019.
• Fidelity Multi Asset Defensive Fund merged into Fidelity Multi Asset Open Defensive Fund on 9 March 2019 and was terminated on 11 November 2019 therefore no financial statements have been produced in accordance with the COLL.
• Fidelity Multi Asset Strategic Fund merged into Fidelity Multi Asset Open Strategic Fund on 9 March 2019 and was terminated on 21 November 2019 therefore no financial statements have been produced in accordance with the COLL.
• Fidelity Multi Asset Open Strategic Fund A Income Shares converted Into A Accumulation Shares on 25 April 2019.
• Fidelity Multi Asset Open Strategic Fund Y Income Shares converted into N Accumulation Shares on 25 April 2019.
• Fidelity Multi Asset Open Growth Fund, Fidelity Multi Asset Open Strategic Fund, Fidelity Multi Asset Income Fund, Fidelity Multi Asset Open Defensive Fund, Fidelity Multi Asset Open Adventurous Fund, Fidelity Open World Fund, Fidelity Multi Asset Balanced Income Fund and Fidelity Multi Asset Income & Growth Fund N Accumulation shares was renamed W Accumulation Shares on 4 September 2019.
• Fidelity Multi Asset Open Growth Fund, Fidelity Multi Asset Open Strategic Fund, Fidelity Multi Asset Open Defensive Fund, Fidelity Multi Asset Open Adventurous Fund and Fidelity Open World Fund Y Accumulation shares closed on 15 October 2019.
• Fidelity Multi Asset Allocator Strategic Fund MoneyBuilder Asset Allocator Accumulation Shares converted into Y Accumulation Shares and was renamed W Accumulation Shares on 22 October 2019.
Statement of Authorised Corporate Director’s (ACD) Responsibilities in relation to the Report and Financial Statements of the Company
The Open-Ended Investment Companies Regulations 2001 (SI 2001/1228) and Collective Investment Schemes sourcebook (COLL) require the ACD to prepare financial statements for each annual and half-yearly accounting period which give a true and fair view of the financial position of the Company and of its net revenue and net capital gains or losses on the property of the Company for the year. In preparing the financial statements the ACD is required to:
• select suitable accounting policies and then apply them consistently
• comply with the requirements of the UK Financial Reporting Standard 102 (FRS 102) and the Statement of Recommended Practice for UK Authorised Funds issued by The Investment Management Association (IMA) in May 2014, the COLL, the Prospectus and the Instrument of Incorporation
• follow generally accepted accounting principles and applicable accounting standards
• keep proper accounting records which enable it to demonstrate that the financial statements as prepared comply with the above requirements
• prepare the financial statements on the going concern basis unless it is inappropriate to presume the Company will continue in operation
• take reasonable steps for the prevention and detection of fraud or other irregularities.
Certification of the Annual Report and Financial Statements by Directors of the ACD
In accordance with the requirements of the COLL as issued and amended by the Financial Conduct Authority, the report and financial statements are approved on behalf of the Directors of FIL Investment Services (UK) Limited, the ACD.
John Clougherty Anthony LanserDirector Director
FIL Investment Services (UK) Limited 5 February 2020
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Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Report of the Depositary to the Shareholders of the Fidelity Investment Funds IV
The Depositary must ensure that the Company is managed in accordance with the Financial Conduct Authority’s Collective Investment Schemes sourcebook, and from 22 July 2014 the Investment Funds Sourcebook, the Open-Ended Investment Companies Regulations 2001 (S1 2001/1228), as amended, the Financial Services and Markets Act 2000, as amended, (together “the Regulations”), the Company’s Instrument of Incorporation and Prospectus (together “the Scheme documents”) as detailed below.
The Depositary must in the context of its role act honestly, fairly, professionally, independently and in the interests of the Company and its investors.
The Depositary is responsible for the safekeeping of all custodial assets and maintaining a record of all other assets of the Company in accordance with the Regulations.
The Depositary must ensure that:
• the Company’s cash flows are properly monitored, and that cash of the Company is booked into the cash accounts in accordance with the regulations;
• the sale, issue, repurchase, redemption and cancellation of shares are carried out in accordance with the regulations;
• the value of shares of the Company are calculated in accordance with regulations;
• any consideration relating to transactions in the Company’s assets is remitted to the Company within the usual time limits;
• the Company’s income is applied in accordance with the regulations; and
• the instructions of the Alternative Investment Fund Manager (“the AIFM” or “the Manager”) are carried out (unless they conflict with the regulations).
The Depositary also has a duty to take reasonable care to ensure that the Company is managed in accordance with the Scheme documents and the Regulations in relation to the investment and borrowing powers applicable to the Company.
Having carried out such procedures as we consider necessary to discharge our responsibilities as Depositary of the Company, it is our opinion, based on the information available to us and the explanations provided, that in all material respects the Company, acting through the AIFM:
(i) has carried out the issue, sale, redemption and cancellation and calculation of the price of the Company’s shares and the application of the Company’s income in accordance with the Regulations and the Scheme documents of the Company; and
(ii) has observed the investment and borrowing powers and restrictions applicable to the Company in accordance with the Regulations and Scheme documents of the Company.
J.P. Morgan Europe LimitedLondon 5 February 2020
Independent Auditors’ report to the Shareholders of Fidelity Investment Funds IV
Report on the audit of the financial statements
Opinion
In our opinion, the financial statements of Fidelity Investment Funds IV (the “Company”):
• give a true and fair view of the financial position of the Company and each of the sub-funds as at 31 October 2019 and of the net revenue/(expenses) and the net capital gains on the scheme property of the Company and each of the sub-funds for the year then ended; and
• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law), the Statement of Recommended Practice for UK Authorised Funds, the Collective Investment Schemes sourcebook and the Instrument of Incorporation.
Fidelity Investment Funds IV is an Open-Ended Investment Company (“OEIC”) with 14 sub-funds. The financial statements of the Company comprise the financial statements of each of the sub-funds. We have audited the financial statements, included within the Annual Report and Financial Statements (the “Annual Report”), which comprise: the Balance Sheets as at 31 October 2019; the Statements of Total Return and the Statements of Change in Net Assets Attributable to Shareholders for the year then ended; the Distribution Statements; the Accounting Policies of Fidelity Investment Funds IV and its sub-funds; and the Notes to the financial statements, which include a description of the significant accounting policies.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We remained independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
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Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which ISAs (UK) require us to report to you when:
• the Authorised Corporate Director’s use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
• the Authorised Corporate Director has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Company’s or any of the sub-funds’ ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company’s or the sub-fund’s ability to continue as a going concern. For example, the terms of the United Kingdom’s withdrawal from the European Union are not clear, and it is difficult to evaluate all of the potential implications on the company’s trade, customers, suppliers and the wider economy.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The Authorised Corporate Director is responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.
Authorised Corporate Director’s Report
In our opinion, the information given in the Authorised Corporate Director’s Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
Responsibilities for the financial statements and the audit
Responsibilities of the Authorised Corporate Director for the financial statements
As explained more fully in the Statement of Authorised Corporate Director’s Responsibilities in relation to the Report and Financial Statements of the Company set out on page 3, the Authorised Corporate Director is responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The Authorised Corporate Director is also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Authorised Corporate Director is responsible for assessing the Company’s and each of the sub-fund’s ability to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis of accounting unless the Authorised Corporate Director either intends to wind up or terminate the Company or individual sub-fund, or has no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s shareholders as a body in accordance with paragraph 4.5.12 of the Collective Investment Schemes sourcebook as required by paragraph 67(2) of the Open-Ended Investment Companies Regulations 2001 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
OTHER REQUIRED REPORTING
Opinion on matter required by the Collective Investment Schemes sourcebook
In our opinion, we have obtained all the information and explanations we consider necessary for the purposes of the audit.
Collective Investment Schemes sourcebook exception reporting
Under the Collective Investment Schemes sourcebook, we are also required to report to you if, in our opinion:
• proper accounting records have not been kept; or
• the financial statements are not in agreement with the accounting records.
We have no exceptions to report arising from this responsibility.
PricewaterhouseCoopers LLPChartered Accountants and Statutory Auditors London 5 February 2020
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Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Performance Overview - year ended 31 October 2019
Global equities gained over the period, supported by the accommodative policy stance of major central banks and encouraging corporate results. However, global economic concerns, trade issues, uncertainty in Europe and tensions in the Middle East kept markets volatile. Notably, after raising interest rates nine times in the past four years, the US Federal Reserve changed course and implemented three rate cuts in 2019 amid concerns over slowing global growth. The European Central Bank unveiled a stimulus package in September to support growth and inflation, while the Bank of Japan indicated its readiness to introduce additional stimulus measures if needed. China also introduced measures to support its economy. Meanwhile, the UK’s exit from the European Union (EU) has been delayed until 31 January 2020, after UK politicians failed to agree on exit deals. Against this global backdrop, key equity markets generated positive performance, with Pacific ex Japan, US and Europe ex UK equities rising significantly. Emerging market equities also gained, but underperformed developed markets. Returns in sterling terms were undermined by its appreciation against the US dollar and euro, but supported by its depreciation against the yen.
Global property markets generated positive returns. In the US, low mortgage rates continued to drive demand for residential property. In the eurozone, residential equities in Germany were strong in the first half of the period, but came under pressure in the second half after the government proposed a five-year rent-freeze in Berlin. The property market in Spain remained healthy, supported by relatively low mortgage rates. UK property stocks grew at a modest pace. Within Asia, real estate stocks in Hong Kong fell in the second half, but ended the year in positive territory. Investors were concerned over weaker residential demand. The real estate market in Japan was buoyed by ultra-low interest rates and increased foreign investments ahead of the 2020 Tokyo Olympics.
Commodities declined and underperformed both equities and property stocks. Energy stocks fell early in the period, after the US gave unexpectedly generous sanction waivers to Iran’s biggest oil buyers. This, coupled with rising US oil production, led to concerns about global oversupply at a time when weak economic data raised concerns about demand. Oil prices recovered some ground later in the period, amid tightening supply and fewer concerns about the global economy. However, ongoing US-China trade tensions fanned fears that slowing economic growth could negatively impact demand for energy. Industrial metals prices were initially negatively impacted by trade-related issues, but were later supported by optimism about a US-China trade deal, a fall in inventories and supply disruptions. Gold prices advanced as investors sought safe haven assets amid weak economic data.
Fixed income markets posted positive returns over a period that was characterised by a changing monetary policy regime as investors grew increasingly concerned over the health of the global economy. Government bond yields slumped to record lows, many of them below zero, as central banks across the world adopted a cautious monetary policy stance, reflecting a combination of weak economic data, continued uncertainty over US-China trade negotiations and weak domestic inflation. Consequently, the US Fed cut interest rates thrice in 2019. The European Central Bank (ECB) also lowered its deposit rate by 0.1 percentage points to a new all-time low of -0.5% and revamped its quantitative easing programme. Consequently, the 10-year US Treasury yield dropped to its lowest level since 2016. Ten-year German bonds also touched record lows of -0.7%, as global recession worries intensified. In the UK, 10-year government bond (Gilt) yields fell below 0.5%, dipping below its previous August 2016 trough, which came after the Bank of England slashed interest rates to an all-time low following the UK’s decision to leave the EU. In Japan, 10-year bond yields slipped to the lowest level since July 2016 and entered into negative territory. The Bank of Japan decided to keep its key short-term interest rate unchanged and shifted its focus on steepening its yield curve. In credit markets, corporate bond spreads tightened amid investors’ search for yields. Emerging markets also posted positive returns over the period, with local currency bonds outperforming hard currency bonds.
Market Performance Review
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Source: Refinitiv DataStream, Total Returns, GBP, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Source: Refinitiv DataStream, Total Returns in GBP rebased to 100, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Market Review12-m to October 2019
Global equities gained over the period, supported by the accommodative policy stance of major central banks and encouraging corporate results. However, global economic concerns, trade issues, uncertainty in Europe and tensions in the Middle East kept markets volatile. Notably, after raising interest rates nine times in the past four years, the US Federal Reserve changed course and implemented three rate cuts in 2019 amid concerns over slowing global growth. The European Central Bank unveiled a stimulus package in September to support growth and inflation, while the Bank of Japan indicated its readiness to introduce additional stimulus measures if needed. China also introduced measures to support its economy. Meanwhile, the UK’s exit from the European Union (EU) has been delayed until 31 January 2020, after UK politicians failed to agree on exit deals. Against this global backdrop, key equity markets generated positive performance, with Pacific ex Japan, US and Europe ex UK equities rising significantly. Emerging market equities also gained, but underperformed developed markets. Returns in sterling terms were undermined by its appreciation against the US dollar and euro, but supported by its depreciation against the yen.
Source: Refinitiv DataStream, Total Returns in GBP rebased to 100, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Source: Refinitiv DataStream, Total Returns, GBP, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Global property markets generated positive returns. In the US, low mortgage rates continued to drive demand for residential property. In the eurozone, residential equities in Germany were strong in the
Market Review12-m to October 2019
Global equities gained over the period, supported by the accommodative policy stance of major central banks and encouraging corporate results. However, global economic concerns, trade issues, uncertainty in Europe and tensions in the Middle East kept markets volatile. Notably, after raising interest rates nine times in the past four years, the US Federal Reserve changed course and implemented three rate cuts in 2019 amid concerns over slowing global growth. The European Central Bank unveiled a stimulus package in September to support growth and inflation, while the Bank of Japan indicated its readiness to introduce additional stimulus measures if needed. China also introduced measures to support its economy. Meanwhile, the UK’s exit from the European Union (EU) has been delayed until 31 January 2020, after UK politicians failed to agree on exit deals. Against this global backdrop, key equity markets generated positive performance, with Pacific ex Japan, US and Europe ex UK equities rising significantly. Emerging market equities also gained, but underperformed developed markets. Returns in sterling terms were undermined by its appreciation against the US dollar and euro, but supported by its depreciation against the yen.
Source: Refinitiv DataStream, Total Returns in GBP rebased to 100, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Source: Refinitiv DataStream, Total Returns, GBP, MSCI World, BofA ML Global Broad Market Index, Bloomberg Commodity Index, FTSE EPRA/NAREIT Developed, 31.10.2018 - 31.10.2019
Global property markets generated positive returns. In the US, low mortgage rates continued to drive demand for residential property. In the eurozone, residential equities in Germany were strong in the
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Accounting Policies of Fidelity Investment Funds IV and its sub-funds
Accounting policies
a) Basis of preparation - The financial statements of the sub-funds have been prepared on a going concern basis, under the historical cost convention as modified by the revaluation of certain financial assets and liabilities measured at fair value through profit or loss except as outlined below. The financial statements are also prepared in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice (UK GAAP) and the Statement of Recommended Practice (SORP) for UK Authorised Funds issued by the Investment Management Association (IMA) in May 2014.
b) Recognition of revenue - Dividends on quoted equities are recognised when the security is quoted ex-dividend. Interest from debt securities are accounted for on an effective yield basis. Effective yield recognises any discount or premium on the purchase of an investment as revenue over its remaining life. Distributions on underlying funds are recognised when the shares/units are quoted ex-distribution. Other revenue is accounted for on an accruals basis. Underwriting commission is recognised when the issue takes place. Special dividends are treated as revenue or capital depending on the facts of each particular case.
c) Treatment of expenses:
• All expenses are accounted for on an accruals basis.
• Annual charges - In accordance with the COLL and as agreed with the Depositary, charges and expenses for the fund may be treated as capital charges, which will enhance income returns but may constrain capital growth. Where the management fees are ultimately borne by the capital of an underlying fund, the rebates are credited to capital for the purpose of calculating the distribution.
• Other expenses - All other expenses are chargeable against revenue for distribution purposes other than those relating to purchases and sales of investments which are excluded for the purpose of calculating the distribution.
• Underlying fund charges - The sub-fund may invest in other collective investment schemes, various other charges and expenses may be incurred indirectly by the fund at the level of the underlying funds. Where any fund invests in other collective investment schemes managed by independent fund managers, the ACD will seek to negotiate a high level of rebate of the underlying funds management charges, so as to minimise the effect of charging at both the fund and underlying fund levels. Where any fund invests in other collective investment schemes managed by the ACD or an associate of the ACD, to avoid a double management charge in respect of the same portfolio, the full amounts of the charges which the ACD and/or any associated company of the ACD receives for managing the investments of the underlying fund, will be credited to the fund, to the extent that such charges are attributable to investment in the underlying funds by the fund.
d) Allocation to multiple share classes – All charges and expenses which are directly attributable to the fund will be charged to the class or classes within the fund pro rata to the net asset value of the fund attributable to each class, where appropriate. Any charges and expenses not attributable to any one fund will normally be allocated by the ACD to all funds (and their classes) pro rata to the net asset values of the funds (and their classes), although the ACD has the discretion to allocate such charges and expenses in a different manner which it considers fair to shareholders generally.
e) Distribution policy - The distribution policy of the individual funds is to distribute or accumulate all available revenue after deduction of expenses properly chargeable against revenue.
f) Taxation - Provision is made for corporation tax at the current rate on the excess of taxable revenue over allowable expenses, with relief for overseas tax taken where appropriate. Deferred tax is provided using the liability method on all timing differences arising from the different treatment of items for taxation and accounting purposes. Deferred tax assets are recognised to the extent that they are considered recoverable.
g) Basis of valuation of investments - Investments in securities and underlying funds have been valued using the market price at the noon valuation point on the last business day of the accounting period. Market value is defined by the SORP as fair value which in an active market is the value of long positions at the quoted bid price and fair value of short positions is the quoted offer price. Holdings in other collective investment schemes are valued at bid price for dual priced funds and at single price for single priced funds. It is the responsibility of the Fair Value Committee (FVC) to ensure pricing sources and methodologies used to value securities are appropriate as delegated by the ACD. Where there is no price source from an active market for an investment, the FVC will assess information available from internal and external sources in order to arrive at a fair value. In seeking to value such securities, the FVC will gather valuation related information from multiple internal and external sources and may apply judgement in determining the fair value. These sources include historic trading and pricing information (including grey market trades), the views of internal security analysts, company specific news and fundamental data as well as information relating to comparable companies within related industries and sectors. The FVC policies and procedures remain under continuous review by the ACD.
Fair value adjustments may be implemented to protect the interests of the Shareholder Funds against market timing practices. Accordingly, if a fund invests in markets that are closed for business at the time the fund is valued, the ACD may, by derogation from the provisions above, allow for the securities included in a particular portfolio to be adjusted to reflect more accurately the fair value of the fund’s investments at the point of valuation.
Fair value market adjustments were applied to investments with the following effect on the fund midday prices as at 31 October 2019:
• US Market -0.30% (2018: 0.77%)
• Japan -0.78% (2018:nil)
• Hong Kong & China -0.66% (2018:nil)
h) The market value disclosed alongside each investment in the Portfolio Statement represents the fair value. Each derivative position is shown as a separate investment. The Portfolio Statement includes for each investment the percentage of the net assets. This may result in the geographical or sector allocations being different to the comparative index. The largest holdings disclosure is consistent with this basis, and therefore derivative positions may not appear in the list of largest holdings. A copy of the Fund Factsheet report disclosing the sector/industry exposure, country exposure and top holdings including derivatives exposures may be obtained upon request from the ACD alternatively, please go to http://www.fidelity.co.uk.
7
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Accounting Policies of Fidelity Investment Funds IV and its sub-funds
i) Derivatives - Where appropriate, certain permitted transactions such as derivatives are used. Where such transactions are used to protect or enhance revenue, the revenue and expenses derived from them are included in Revenue or Expenses in the Statement of Total Return. Where such transactions are used to protect or enhance capital, the gains or losses are included in Net capital gains/(losses) in the Statement of Total Return. Any positions on such transactions open at the year end are reflected in the Balance Sheet at their market value. All gains and losses in the value of futures contracts, interest rates swaps, credit default swaps, equity forwards, contracts for difference, equity linked notes and options are disclosed in the Statement of Total Return under Net capital gains/(losses).
For futures, equity forwards and contracts for difference, the dividend element is included in revenue along with the associated finance costs of these contracts. Ongoing premia on credit default swaps are charged or credited to revenue/expenses on an accruals basis, depending on whether protection is bought or sold. Revenue receivable/payable on interest rate swaps is included in revenue on an accruals basis. The premium received on covered call options is taken to revenue over the life of the contract provided the strike price of the option is greater than the price of the underlying security at the time of trade.
Where forward foreign exchange contracts have been entered into to hedge the underlying funds and securities against currency exchange rate movements, any subsequent hedge gain or loss is taken to capital.
j) Exchange rates - Assets and liabilities denominated in foreign currencies have been translated into sterling at the rate of exchange ruling at the noon valuation point on the last business day of the accounting period. Revenue items denominated in foreign currency are translated into sterling at exchange rates ruling at the date of the transaction. Differences on exchange are included within the Statement of Total Return.
k) Dilution levy - In certain circumstances, the value of the property of a Fund may be reduced as a result of costs incurred in dealings in the Fund’s investments, including stamp duty or stamp duty reserve tax, or through dealing in those investments at prices other than the mid-market price. In order to prevent this effect, known as “dilution”, and the consequent potential adverse effect on remaining Shareholders, the ACD has the power to charge a “dilution levy” when Shares are bought or sold.
In the year to 31 October 2019 no dilution levy was paid to the Company (2018: none).
8
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
9
Risk management policies of Fidelity Investment Funds IV and its sub-funds
Risk framework
The Board of Directors of FIL Limited, the ultimate parent company of the ACD, has established a Risk Policy, a Risk Appetite statement and a number of other risk related policies for adoption throughout the Fidelity International group of companies, including the ACD. There is a clearly defined structure operating within a corporate governance and management framework that is designed to address the related business risks, including those arising from financial instruments. Risk management policies and procedures are established by the Board and updated according to market, industry and government initiatives and regulatory developments. The Board monitors that a robust system of internal control exists to ensure compliance with rules, regulations and policies. It is the Board of Directors of the ACD that is ultimately responsible for monitoring risk but day to day management of the risk process has been delegated to other areas as appropriate.
Fidelity operates a ‘multiple lines of defence’ approach to risk management; also, the risk control processes are comprehensive, multi-layered, both quantitative and qualitative and do not rely on any one risk measure or system. The primary responsibility for financial instrument risk management rests with the portfolio manager of each fund who is overseen by the relevant Chief Investment Officer (CIO). On a regular basis each fund is formally reviewed in a meeting involving the portfolio manager, the relevant CIO, Investment Management Portfolio Analytics and others; the review covers multiple aspects of the fund’s profile including trading activity, turnover, performance, structure, style profile, the use of derivatives and other relevant subjects such as yield curve exposure and sector and credit rating positioning in the case of Fixed Income funds. In addition to this review there is a formal Investment Risk Oversight Committee (IROC), chaired by the head of the Investment Management Risk function, whose remit includes review of various risk and performance measures, liquidity and other investment risks.
Furthermore, there is a Derivative Risk Committee that focuses on all aspects of risk arising from the use of derivative instruments. The global exposure relating to derivatives held in a fund may not exceed the net value of that fund. Global exposure calculations for all funds – unless otherwise indicated - use the commitment approach as part of their risk management process, measure and limits. The funds in this umbrella OEIC are governed by non-UCITS rules. The rules and prospectus limits are monitored and reported on by an independent Investment Compliance function.
Risk factors
The main risks arising from financial instruments are market price, foreign currency, interest rate, liquidity, counterparty and credit risks. There are policies in place to ensure each of these risks are managed in an appropriate manner.
Market price risk
Market price risk arises from the uncertainty about future price movements on financial instruments held. It represents the potential loss each fund might suffer through holding market positions in the face of adverse price movements. The value of investments (including derivatives) is not fixed and may go down as well as up. This may be as a result of a specific factor affecting the value of an individual investment or may be caused by general market factors. Some of the funds may invest in securities of countries experiencing rapid economic growth. Investors should appreciate that these securities may be more volatile than securities in more developed markets with the result that there may be greater risk of price fluctuation and the suspension of redemptions in such funds compared with funds in more mature markets. This volatility may stem from political and economic factors, and be exacerbated by legal, trading liquidity, settlement, currency and other factors. Some emerging market countries may have relatively prosperous economies but may be sensitive to world commodity prices or other factors. Where derivatives are used for either efficient management of the fund or for investment purposes, market price risk will exist as for any other non-derivative investments. The volatility of option prices could be greater than for other derivatives.
Foreign currency risk
The fund’s Total Returns and Balance Sheets can be significantly affected by foreign exchange movements if the fund’s assets and revenue are denominated in currencies other than the fund’s base currency. Three principal areas where foreign currency risk could impact each fund have been identified as:
• Movements in rates affecting the value of investments
• Movements in rates affecting short term timing differences
• Movements in rates affecting the revenue received
The funds may hold forward foreign exchange contracts to hedge the fund’s base currency. The funds may be exposed to short term exchange rate movements, for example between the date when an investment is bought or sold and the date when settlement of the transaction occurs. The ACD may seek to manage exposure to currency movements by using forward and spot foreign exchange contracts. Revenue received in other currencies is converted into base currency on or near the date of receipt.
Interest rate risk
Debt securities have varying levels of sensitivity to changes in interest rates. In general, the price of a fixed rate debt security can fall when interest rates rise and can rise when interest rates fall. Securities with longer maturities can be more sensitive to interest rate changes. The fixed rate component of an interest rate swap will have a similar interest rate risk profile to that of a fixed rate debt security where the currency, fixed rate and maturity are the same.
Liquidity risk
The fund’s assets comprise mainly realisable securities which can be readily sold or redeemed in normal market conditions. The fund’s main liability is the redemption of any shares that investors wish to sell. In general, the ACD manages the cash to ensure it can meet its liabilities. Assets from a fund may need to be sold if insufficient cash is available to finance such redemptions. The fund’s holdings are reviewed on a regular basis, with particular emphasis on the market capitalisation of the issuer (securities issued by larger capitalised companies generally have greater liquidity) and the number of days it would take to trade out of a given security position or percentage of the fund as a whole (determined by reference to available market trading volumes). Where investments cannot be realised in time to meet any potential liability, the fund may borrow up to 10% of its value to ensure settlement.
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Risk management policies of Fidelity Investment Funds IV and its sub-funds
Counterparty risk
All security transactions and derivatives are transacted with brokers and carry the risk that the counterparty to a transaction may not meet their financial obligations. All counterparties for any type of trading are assessed by an independent Credit Research and Analysis function and approved for use by any Fidelity company, including the ACD. Exposures to counterparties are monitored and reported frequently. Margin on exchange-traded derivatives mitigates counterparty risk exposure and in the case of over-the-counter derivatives, collateral is transferred to reduce counterparty risk exposure in accordance with the terms outlined in market standard (ISDA) derivative legal contracts.
Credit risk
Investments may be adversely affected if any of the institutions with which money is deposited suffers insolvency or other financial difficulties. The process outlined above under ‘Counterparty risk’ is used to review, approve and report on exposures to institutions with which money is deposited.
Credit risk also arises from the uncertainty about the payment of interest and the repayment of principal bond investments. Default risk is based on the issuer’s ability to make interest payments and to repay the loan at maturity. Due to the higher possibility of default, an investment in corporate bonds is generally less secure than an investment in government bonds. Default risk may therefore vary between different government issuers as well as between different corporate issuers. In certain cases, government bonds may have higher probability of default than specific corporate issuers. The funds may hold credit default swaps to manage their credit risk profile. Credit default swaps are transacted to take advantage of expected movements in credit spreads on either individual securities or baskets of securities.
Fair values of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the balance sheet, and their fair value. The numerical information in respect of financial instruments disclosure is provided in the financial statements for the individual funds.
10
Fidelity Allocator World Fund
11
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to increase the value of your investment over a period of 5 years or more through global exposure to higher risk assets.
The fund will invest at least 70% into funds that use an ‘index tracking’ (also known as 'passive') investment management approach (these may include funds managed by Fidelity), with the aim of pursuing a lower cost investment approach. The fund can also invest directly into transferable securities, other collective investment schemes, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Through its investments, the fund aims to maintain an allocation of 100% in higher-risk assets (such as global equities, global emerging market equities, global smaller companies and global property securities). This allocation, as well as the breakdown of higher-risk assets, may change according to prevailing market conditions and the efficient management of the portfolio.
The fund is actively managed. The Investment Manager will, when selecting investments for the fund and for the purposes of monitoring risk, consider a custom blend of indices*. The Investment Manager has a limited degree of freedom relative to the blended index and may invest outside the blended index, to take advantage of investment opportunities. This means the fund’s investments and therefore performance may vary from, but is unlikely to be significantly different to, the index.
*70% MSCI World, 10% FTSE EPRA/ NAREIT, 10% MSCI Emerging Markets, 10% MSCI World small cap.
Performance and Portfolio ActivityThe fund delivered positive returns over the period. The allocation to growth assets, including global large and mid-cap stocks supported returns, benefiting from the continued support from central banks and by encouraging corporate results. Holdings in emerging market equities, small-cap equities and global real estate investment trusts (REIT) also added value. While all regional equity holdings enhanced gains, the allocation to the US was the most rewarding. The fund is managed to provide diversified and efficient exposure to global markets. It has a purely static strategic asset allocation – 100% of the portfolio is invested in higher risk growth assets. Among the underlying strategies, the holding in E-mini Russell 2000 Index futures was sold and the exposure to L&G Global Small Cap Equity Index Fund was increased.
OutlookThe fund’s asset allocation is not impacted by the market outlook. The fund is managed to provide diversified and efficient exposure to global markets and is rebalanced periodically to keep asset allocation in line with its long-term strategic asset allocation.
Chris Forgan & Nick PetersFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
Y Accumulation Shares 5
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
Fidelity Allocator World Fund
12
Comparative Performance Table
Y Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017
Opening net asset value per share 185.03 181.62 160.94
Return before operating charges* 21.97 3.87 21.16
Operating charges (0.49) (0.46) (0.48)
Return after operating charges* 21.48 3.41 20.68
Distributions (3.04) (2.23) (1.77)
Retained distributions on accumulation shares 3.04 2.23 1.77
Closing net asset value per share 206.51 185.03 181.62
*after direct transaction costs of 0.01 0.03 0.08
Performance
Return after charges 11.6% 1.9% 12.9%
Other information
Closing net asset value (£'000) 52,587 39,813 3,843
Closing number of shares 25,464,639 21,517,392 2,116,055
Operating charges 0.25% 0.25% 0.28%
Direct transaction costs 0% 0.02% 0.05%
Prices (pence per share)
Highest share price 215.30 198.90 182.10
Lowest share price 172.60 169.80 153.80
Fidelity Allocator World Fund
13
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 4,167 298
Revenue 5 818 501
Expenses 6 (112) (91)
Interest payable and similar charges 8 (1) -
Net revenue/(expense) before taxation 705 410
Taxation 7 (19) (11)
Net revenue/(expense) after taxation 686 399
Total return before distributions 4,853 697
Distributions 8 (686) (396)
Change in net assets attributable to shareholders from investment activities 4,167 301
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 39,813 31,249
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 12,274 10,278
Amounts payable on cancellation of shares (4,442) (2,494)
7,832 7,784
Change in net assets attributable to shareholders from investment activities (see above) 4,167 301
Retained distribution on accumulation shares 8 775 479
Closing net assets attributable to shareholders 52,587 39,813
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 52,303 38,629
Current assets:
Debtors 9 94 85
Cash equivalents 1 939
Cash and bank balances 10 233 355
Total other assets 328 1,379
Total assets 52,631 40,008
Liabilities:
Investment liabilities (1) (122)
Creditors
Other creditors 11 (43) (73)
Total other liabilities (43) (73)
Total liabilities (44) (195)
Net assets attributable to shareholders 52,587 39,813
Fidelity Allocator World Fund
14
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 4,116 436
Gains/(losses) on derivative contracts+ 26 (191)
Gains/(losses) on forward currency contracts+ (2) 40
Other currency gains/(losses) - 1
ACD fee rebate/waiver to capital 27 12
Net capital gains/(losses) 4,167 298
+ These comprise:
Realised gains/(losses)++ 441 3,035
Unrealised gains/(losses) 3,699 (2,750)
Total 4,140 285
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 508 293
Unfranked UK dividend distributions 143 37
Overseas dividend distributions 132 124
Interest distributions - 13
Derivative revenue - 7
Management fee rebate to income 3 -
ACD fee rebate/waiver to income 32 26
Bank interest - 1
Total revenue 818 501
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 112 91
112 91
Total expenses* 112 91
*The ACD is responsible for payment of all charges and expenses of the fund out of its investment management fees including audit fees amounting to £10,000 (including VAT) (2018: £10,000).
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 8 -
Overseas taxation 19 7
Double taxation relief (8) -
Prior year adjustment - 4
Total current taxation 19 11
Fidelity Allocator World Fund
15
Notes to the Financial Statements
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 705 410
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 141 82Effects of:
ACD fee waiver to capital 5 2
Double taxation relief (8) -
Increase/(decrease) in unutilised management expenses (10) -
Overseas tax expensed - (1)
Overseas taxation 19 7
Prior year adjustment - 4
Revenue not included for tax purposes (128) (83)
Current tax charge/(credit) 19 11
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distribution takes account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares
Final 775 479
Add: Revenue deducted on cancellation of shares 38 16
Deduct: Revenue received on issue of shares (127) (99)
Net distributions for the year 686 396
Interest/other
Derivative expense 1 -
Total finance costs 687 396
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 686 399
Add back (revenue)/expenses transferred to capital:
Equalisation on conversions - (3)
686 396
Details of the distribution per share is set out in the Distribution Statement.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 76 54
Sales awaiting settlement - 24
ACD fee rebate/waiver recoverable 6 4
UK income tax recoverable 12 3
Total debtors 94 85
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers - 212
Cash and bank balances 233 143
Total cash and bank balances 233 355
Fidelity Allocator World Fund
16
Notes to the Financial Statements
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares - 34
Purchases awaiting settlement 32 31
Accrued expenses 11 8
Total other creditors 43 73
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro - 6 - 6
Japanese Yen - 4 - 4
Swedish Krona - 1 - 1
UK Pound 50,362 222 51 50,635
US Dollar 1,941 - - 1,941
Total 52,303 233 51 52,587
31/10/18 £'000 £'000 £'000 £'000
Canadian Dollar (1) - - (1)
Euro (1) 6 - 5
Japanese Yen (2) 4 - 2
UK Pound 38,170 345 12 38,527
US Dollar 1,280 - - 1,280
Total 39,446 355 12 39,813
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile
The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers. At the year end, there is no significant interest rate risk on the fund.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.79% rise or fall in the fund's market value (2018: 0.81%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Futures exposure
At the year end the fund holds no derivatives that could impact it significantly (2018: same).
Fidelity Allocator World Fund
17
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 3,194 1 0.04 - -
Mutual Fund 14,010 - - - -
Total 17,204 1 -
Total including transaction costs 17,205
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,656 1 0.05 - -
Mutual Fund 5,959 - - - -
Total 7,615 1 -
Total including transaction costs 7,614
Total as a percentage of average net assets*
0.00 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 6,716 4 0.06 - -
Mutual Fund 26,144 - - - -
Corporate actions 1 - - - -
Derivative - 2 - - -
Total 32,861 6 -
Total including transaction costs 32,867
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 9,782 5 0.05 - -
Mutual Fund 14,535 - - - -
Total 24,317 5 -
Total including transaction costs 24,312
Total as a percentage of average net assets
0.03 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.03% (2018: 0.03%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 7,678 - 5,593 (118)
Level 2: Observable market data 44,626 (1) 33,975 (4)
Level 3: Unobservable data - - - -
52,304 (1) 39,568 (122)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares
Shares in issue as at 31/10/19
Y Accumulation Shares 21,517,392 6,242,972 (2,295,725) 25,464,639
Fidelity Allocator World Fund
18
Notes to the Financial Statements
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £11,000 (2018: £8,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £506,000 (2018: £115,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £11,590,000 and £5,083,000 respectively (2018: £20,485,000 and £14,516,000).Amounts due at the year end in respect of investments purchased of £32,000 (2018: £24,000) are included within purchases awaiting settlement in Note 11.Amounts receivable at the year end in respect of investments sold of £nil (2018: £31,000) are included within sales awaiting settlement in Note 9.
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
JP Morgan (1) - - - - - (1)
Total (1) - - - - - (1)
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (2) - - - - - (2)
HSBC Global Markets (1) - - - - - (1)
Morgan Stanley (1) - - - - - (1)
National Australia Bank 32 - - - - - 32
UBS - - (118) - - 212 94
Total 28 - (118) - - 212 122
18 Shareholders' funds
The fund has one share class; Y Accumulation Shares. The annual management charge is as follows:Y Accumulation Shares : 0.25%The distributions per share class are given in the Distribution Statement.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
Y Accumulation Shares 206.51 213.59 3.43
Fidelity Allocator World Fund
19
Distribution Statement
for the year ended 31 October 2019Y Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 3.0430 - 3.0430 2.2256
Group 2 0.9809 2.0621 3.0430 2.2256
xxx xxx xxx xxx xxx
Fidelity Multi Asset Allocator Adventurous Fund
20
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to increase the value of your investment over a period of 5 years or more through a portfolio providing global exposure to both lower and higher risk assets.
The fund will invest at least 70% into funds that use ‘index tracking’ (also known as 'passive') investment management approach (these may include funds managed by Fidelity), with the aim of pursuing a lower cost investment approach. The fund can also invest directly into transferable securities, other collective investment schemes, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Through its investments, the fund aims to maintain an allocation of 20% in lower-risk assets (such as debt instruments including global government bonds, global corporate bonds and cash) and 80% higher-risk assets (such as global equities, global emerging market equities, global smaller companies and global property securities). This allocation, as well as the breakdown of higher-risk and lower-risk assets, may change according to prevailing market conditions and the efficient management of the portfolio.
The fund is actively managed. The Investment Manager will, when selecting investments for the fund and for the purposes of monitoring risk, consider a custom blend of indices*. The Investment Manager has a limited degree of freedom relative to the blended index and may invest outside the blended index, to take advantage of investment opportunities. This means the fund’s investments and therefore performance may vary from, but is unlikely to be significantly different to, the index.
*56% MSCI World, 8% FTSE EPRA/ NAREIT, 8% MSCI Emerging Markets, 8% MSCI World small cap, 12% Bloomberg Barclays Global Governments Total Return and 8% Bloomberg Barclays Corporate Total Return GBP Hedged.
Performance and Portfolio ActivityThe fund delivered positive returns over the period. The allocation to growth assets, including global large and mid-cap stocks, emerging market equities and global real estate investment trusts (REIT) benefited from the continued support from central banks and encouraging corporate results. The allocation to global government and corporate bonds gained against a backdrop of declining government bond yields. The fund is managed to provide diversified and efficient exposure to global markets. It has a purely static strategic asset allocation – 20% of the portfolio is invested in lower risk defensive assets and 80% in higher risk growth assets. Among the underlying strategies, positions in Lyxor FTSE Actuaries UK Gilts ETF and iShares Overseas Government Bond Index Fund were sold. A new position was purchased in HSBC Global Government Bond Index Fund. Elsewhere, the holding in E-mini Russell 2000 Index futures was sold and the exposure to L&G Global Small Cap Equity Index Fund was raised.
OutlookThe fund’s asset allocation is not impacted by the market outlook. The fund is managed to provide diversified and efficient exposure to global markets and is rebalanced periodically to keep asset allocation in line with its long-term strategic asset allocation.
Chris Forgan & Nick PetersFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 5
Y Accumulation Shares 5
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Allocator Adventurous Fund
21
Comparative Performance Table
A Accumulation Shares Y Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share 151.26 153.96 139.45 158.54 159.86 148.64
Return before operating charges* 17.06 (0.87) 16.30 17.96 (0.94) 11.65
Operating charges (1.90) (1.84) (1.79) (0.42) (0.39) (0.43)
Return after operating charges* 15.16 (2.70) 14.51 17.54 (1.32) 11.22
Distributions (0.63) (0.76) (3.50) (2.39) (2.28) (1.90)
Retained distributions on accumulation shares 0.63 0.76 3.50 2.39 2.28 1.90
Closing net asset value per share 166.42 151.26 153.96 176.08 158.54 159.86
*after direct transaction costs of 0.02 0.02 0.05 0.02 0.02 0.05
Performance
Return after charges 10.0% (1.8%) 10.4% 11.1% (0.8%) 7.6%
Other information
Closing net asset value (£'000) 15 15 14 73,197 50,253 5,418
Closing number of shares 9,150 10,092 8,861 41,569,614 31,697,182 3,389,136
Operating charges 1.20% 1.18% 1.20% 0.25% 0.23% 0.28%
Direct transaction costs 0.01% 0.01% 0.04% 0.01% 0.01% 0.04%
Prices (pence per share)
Highest share price 172.10 160.80 154.20 181.70 168.20 160.10
Lowest share price 143.20 142.30 138.50 150.30 148.40 142.50
Fidelity Multi Asset Allocator Adventurous Fund
22
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 5,228 (975)
Revenue 5 1,000 766
Expenses 6 (149) (113)
Interest payable and similar charges 8 (1) (8)
Net revenue/(expense) before taxation 850 645
Taxation 7 (48) (23)
Net revenue/(expense) after taxation 802 622
Total return before distributions 6,030 (353)
Distributions 8 (802) (615)
Change in net assets attributable to shareholders from investment activities 5,228 (968)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 50,268 40,639
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 19,609 13,626
Amounts payable on cancellation of shares (2,886) (3,751)
16,723 9,875
Change in net assets attributable to shareholders from investment activities (see above) 5,228 (968)
Retained distribution on accumulation shares 8 993 722
Closing net assets attributable to shareholders 73,212 50,268
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 72,671 49,148
Current assets:
Debtors 9 394 296
Cash equivalents 2 929
Cash and bank balances 10 363 455
Total other assets 759 1,680
Total assets 73,430 50,828
Liabilities:
Investment liabilities (3) (261)
Creditors
Other creditors 11 (215) (299)
Total other liabilities (215) (299)
Total liabilities (218) (560)
Net assets attributable to shareholders 73,212 50,268
Fidelity Multi Asset Allocator Adventurous Fund
23
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 5,161 (305)
Gains/(losses) on derivative contracts+ 26 (249)
Gains/(losses) on forward currency contracts+ 10 (438)
Other currency gains/(losses) 1 5
ACD fee rebate/waiver to capital 30 12
Net capital gains/(losses) 5,228 (975)
+ These comprise:
Realised gains/(losses)++ 473 1,180
Unrealised gains/(losses) 4,724 (2,172)
Total 5,197 (992)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 514 474
Unfranked UK dividend distributions 144 101
Overseas dividend distributions 123 18
Interest distributions 163 77
Derivative revenue - 15
Management fee rebate to income 8 7
ACD fee rebate/waiver to income 47 30
Bank interest 1 44
Total revenue 1,000 766
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 149 113
149 113
Total expenses* 149 113
*The ACD is responsible for payment of all charges and expenses of the fund out of its investment management fees including audit fees amounting to £10,000 (including VAT) (2018: £10,000).
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 49 18
Overseas taxation 19 14
Double taxation relief (19) (14)
Prior year adjustment (1) 5
Total current taxation 48 23
Fidelity Multi Asset Allocator Adventurous Fund
24
Notes to the Financial Statements
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 850 645
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 170 129Effects of:
Double taxation relief (19) (14)
Increase/(decrease) in unutilised management expenses - (15)
Management fee rebate 6 2
Overseas taxation 19 14
Prior year adjustment (1) 5
Revenue not included for tax purposes (127) (98)
Current tax charge/(credit) 48 23
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final - -
Y Accumulation Shares
Final 993 722
Add: Revenue deducted on cancellation of shares 20 28
Deduct: Revenue received on issue of shares (211) (135)
Net distributions for the year 802 615
Interest/other
Interest - 1
Derivative expense 1 -
Contract for difference finance costs - 7
1 8
Total finance costs 803 623
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 802 622
Add back (revenue)/expenses transferred to capital:
Equalisation on conversions - (6)
Revenue b/f - (1)
802 615
Details of the distributions per share are set out in the Distribution Statement.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 368 276
Management fee rebate recoverable 1 7
ACD fee rebate/waiver recoverable 8 5
UK income tax recoverable 16 8
Sales awaiting settlement 1 -
Total debtors 394 296
Fidelity Multi Asset Allocator Adventurous Fund
25
Notes to the Financial Statements
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers - 212
Cash and bank balances 363 243
Total cash and bank balances 363 455
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 2 32
Purchases awaiting settlement 170 254
Accrued expenses 15 11
UK corporation tax payable 28 3
UK income tax payable - (1)
Total other creditors 215 299
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
UK Pound 70,675 363 179 71,217
US Dollar 1,995 - - 1,995
Total 72,670 363 179 73,212
31/10/18 £'000 £'000 £'000 £'000
Euro (1) - - (1)
UK Pound 48,726 455 14 49,195
US Dollar 1,091 - (17) 1,074
Total 49,816 455 (3) 50,268
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile
The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers. At the year end, there is no significant interest rate risk on the fund.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.60% rise or fall in the fund's market value (2018: 0.53%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.02% fall or rise in the fund's market value (2018: 0.02%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
Fidelity Multi Asset Allocator Adventurous Fund
26
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 7,406 3 0.05 - -
Mutual Fund 24,758 - - - -
Total 32,164 3 -
Total including transaction costs 32,167
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 3,801 2 0.05 - -
Mutual Fund 9,980 - - - -
Total 13,781 2 -
Total including transaction costs 13,779
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 11,063 6 0.05 - -
Mutual Fund 37,541 - - - -
Corporate actions 1 - - - -
Derivative - 2 - - -
Total 48,605 8 -
Total including transaction costs 48,613
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 2,507 1 0.03 - -
Mutual Fund 29,392 - - - -
Corporate actions 1 - - - -
Total 31,900 1 -
Total including transaction costs 31,899
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.05%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 13,812 - 9,332 (118)
Level 2: Observable market data 58,861 (3) 40,745 (143)
Level 3: Unobservable data - - - -
72,673 (3) 50,077 (261)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares 10,092 5,560 (6,172) (330) 9,150
Y Accumulation Shares 31,697,182 11,610,821 (1,738,702) 313 41,569,614
Fidelity Multi Asset Allocator Adventurous Fund
27
Notes to the Financial Statements
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £15,000 (2018: £11,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £511,000 (2018: £301,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £15,507,000 and £5,009,000 respectively (2018: £25,214,000 and £27,078,000).Amounts receivable at the year end in respect of investments sold of £1,000 (2018: nil) are included within sales awaiting settlement in Note 9.Amounts due at the year end in respect of investments purchased of £170,000 (2018: £157,000) are included within purchases awaiting settlement in Note 11.
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (3) - - - - - (3)
JP Morgan 20 - - - - - 20
Total 17 - - - - - 17
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 31 - - - - - 31
HSBC Global Markets 6 - - - - - 6
National Australia Bank (137) - - - - - (137)
UBS - - (118) - - 212 94
Total (100) - (118) - - 212 (6)
18 Shareholders' funds
The fund has two share classes; Y Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.20%Y Accumulation Shares : 0.25%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 166.42 171.09 2.81
Y Accumulation Shares 176.08 181.40 3.02
Fidelity Multi Asset Allocator Adventurous Fund
28
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.6347 - 0.6347 0.7571
Group 2 - 0.6347 0.6347 0.7571
xxx xxx xxx xxx xxxY Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 2.3893 - 2.3893 2.2766
Group 2 0.6349 1.7544 2.3893 2.2766
xxx xxx xxx xxx xxx
Fidelity Multi Asset Allocator Defensive Fund
29
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to increase the value of your investment over a period of 5 years or more through a portfolio providing global exposure to both lower and higher risk assets.
The fund will invest at least 70% into funds that use an ‘index tracking’ (also known as 'passive') investment management approach (these may include funds managed by Fidelity), with the aim of pursuing a lower cost investment approach.
The fund can also invest directly into transferable securities, other collective investment schemes, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Through its investments, the fund aims to maintain an allocation of 80% in lower-risk assets (such as debt instruments including global government bonds, global corporate bonds and cash) and 20% higher-risk assets (including global equities, global emerging market equities, global smaller companies and global property securities). This allocation, as well as the breakdown of higher-risk and lower-risk assets, may change according to prevailing market conditions and the efficient management of the portfolio.
The fund is actively managed. The Investment Manager will, when selecting investments for the fund and for the purposes of monitoring risk, consider a custom blend of indices*. The Investment Manager has a limited degree of freedom relative to the blended index and may invest outside the blended index, to take advantage of investment opportunities. This means the fund’s investments and therefore performance may vary from, but is unlikely to be significantly different to, the index.
*14% MSCI World, 2% FTSE EPRA/ NAREIT, 2% MSCI Emerging Markets, 2% MSCI World small cap, 48% Bloomberg Barclays Global Governments Total Return and 32% Bloomberg Barclays Corporate Total Return GBP Hedged.
Performance and Portfolio ActivityThe fund delivered positive returns over the period. The allocation to global government and corporate bonds gained against a backdrop of declining government bond yields. Global and emerging market equities, as well as global real estate investment trusts (REIT) benefited from the continued support from central banks and encouraging corporate results. The fund is managed to provide diversified and efficient exposure to global markets. It has a purely static strategic asset allocation – 80% of the portfolio is invested in lower risk defensive assets and 20% in higher risk growth assets. Among the underlying strategies, positions in Lyxor FTSE Actuaries UK Gilts ETF and iShares Overseas Government Bond Index Fund were sold. A new position was purchased in HSBC Global Government Bond Index Fund. Elsewhere, the holding in E-mini Russell 2000 Index futures was sold and the exposure to L&G Global Small Cap Equity Index Fund was raised.
OutlookThe fund’s asset allocation is not impacted by the market outlook. The fund is managed to provide diversified and efficient exposure to global markets and is rebalanced periodically to keep asset allocation in line with its long-term strategic asset allocation.
Chris Forgan & Nick PetersFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 3
Y Accumulation Shares 3
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Allocator Defensive Fund
30
Comparative Performance Table
A Accumulation Shares Y Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share 117.11 120.13 119.80 122.67 124.63 123.15
Return before operating charges* 11.54 (1.60) 1.77 12.09 (1.66) 1.84
Operating charges (1.50) (1.42) (1.44) (0.32) (0.30) (0.35)
Return after operating charges* 10.04 (3.02) 0.33 11.77 (1.96) 1.48
Distributions (0.45) (0.36) (0.08) (1.70) (1.54) (1.22)
Retained distributions on accumulation shares 0.45 0.36 0.08 1.70 1.54 1.22
Closing net asset value per share 127.15 117.11 120.13 134.44 122.67 124.63
*after direct transaction costs of 0.03 0.04 0.10 0.03 0.04 0.10
Performance
Return after charges 8.6% (2.5%) 0.3% 9.6% (1.6%) 1.2%
Other information
Closing net asset value (£'000) 3,304 215 396 76,852 58,148 6,680
Closing number of shares 2,598,646 183,728 329,789 57,163,808 47,402,307 5,359,699
Operating charges 1.20% 1.20% 1.20% 0.25% 0.25% 0.28%
Direct transaction costs 0.02% 0.03% 0.08% 0.02% 0.03% 0.08%
Prices (pence per share)
Highest share price 129.50 121.40 121.40 136.70 126.20 125.40
Lowest share price 116.30 116.30 118.10 121.90 121.30 121.40
Fidelity Multi Asset Allocator Defensive Fund
31
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 5,209 (1,713)
Revenue 5 1,084 916
Expenses 6 (188) (155)
Interest payable and similar charges 8 - (2)
Net revenue/(expense) before taxation 896 759
Taxation 7 (5) (16)
Net revenue/(expense) after taxation 891 743
Total return before distributions 6,100 (970)
Distributions 8 (891) (738)
Change in net assets attributable to shareholders from investment activities 5,209 (1,708)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 58,363 59,626
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 22,200 13,663
Amounts payable on cancellation of shares (6,598) (13,949)
15,602 (286)
Change in net assets attributable to shareholders from investment activities (see above) 5,209 (1,708)
Retained distribution on accumulation shares 982 731
Closing net assets attributable to shareholders 80,156 58,363
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 79,400 58,550
Current assets:
Debtors 9 280 104
Cash equivalents 3 294
Cash and bank balances 10 569 288
Total other assets 852 686
Total assets 80,252 59,236
Liabilities:
Investment liabilities (9) (794)
Creditors
Other creditors 11 (87) (79)
Total other liabilities (87) (79)
Total liabilities (96) (873)
Net assets attributable to shareholders 80,156 58,363
Fidelity Multi Asset Allocator Defensive Fund
32
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 5,040 1,082
Gains/(losses) on derivative contracts+ 8 (360)
Gains/(losses) on forward currency contracts+ 151 (2,434)
Other currency gains/(losses) - (14)
Broker fee rebates - 1
ACD fee rebate/waiver to capital 10 11
Management fee rebate to capital - 1
Net capital gains/(losses) 5,209 (1,713)
+ These comprise:
Realised gains/(losses)++ 719 (663)
Unrealised gains/(losses) 4,480 (1,049)
Total 5,199 (1,712)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 163 101
Unfranked UK dividend distributions 35 48
Overseas dividend distributions 25 10
Interest distributions 754 614
Derivative revenue - 33
Management fee rebate to income 25 33
ACD fee rebate/waiver to income 81 60
Bank interest 1 17
Total revenue 1,084 916
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 188 155
188 155
Total expenses* 188 155
*The ACD is responsible for payment of all charges and expenses of the fund out of its investment management fees including audit fees amounting to £10,000 (including VAT) (2018: £10,000).
Fidelity Multi Asset Allocator Defensive Fund
33
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
Overseas taxation 5 8
Prior year adjustment - 8
Total current taxation 5 16
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 896 759
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 179 152Effects of:
ACD fee waiver to capital 2 2
Interest distributions (142) (130)
Overseas tax expensed (1) (2)
Overseas taxation 5 8
Prior year adjustment - 8
Revenue not included for tax purposes (38) (22)
Current tax charge/(credit) 5 16
Open ended investment companies are exempt from UK tax on capital gains.
The fund is an interest distributing fund under Corporation Tax Act 2009 and as interest distributions are deductible when calculating the liability, the corporation tax charge will usually be reduced to nil, except where there are expenses which are not deductible.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final 12 1
Y Accumulation Shares
Final 970 730
982 731
Add: Revenue deducted on cancellation of shares 41 72
Deduct: Revenue received on issue of shares (132) (65)
Net distributions for the year 891 738
Interest/other
Interest - 1
Contract for difference finance costs - 1
- 2
Total finance costs 891 740
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 891 743
Add back (revenue)/expenses transferred to capital:
Equalisation on conversions - (4)
Revenue b/f - (1)
891 738
Details of the distributions per share are set out in the Distribution Statement.
Fidelity Multi Asset Allocator Defensive Fund
34
Notes to the Financial Statements
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 260 62
Management fee rebate recoverable 2 31
ACD fee rebate/waiver recoverable 9 7
UK income tax recoverable 5 4
Sales awaiting settlement 4 -
Total debtors 280 104
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers - 67
Cash and bank balances 569 221
Total cash and bank balances 569 288
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 28 56
Purchases awaiting settlement 40 10
Accrued expenses 19 13
Total other creditors 87 79
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
UK Pound 78,917 569 193 79,679
US Dollar 477 - - 477
Total 79,394 569 193 80,156
31/10/18 £'000 £'000 £'000 £'000
Euro (1) - - (1)
UK Pound 58,384 288 25 58,697
US Dollar (333) - - (333)
Total 58,050 288 25 58,363
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
UK Pound 37,031 - 42,735 79,766
US Dollar - - 486 486
Total 37,031 - 43,221 80,252
31/10/18 £'000 £'000 £'000 £'000
UK Pound 54,446 - 4,329 58,775
US Dollar - - 461 461
Total 54,446 - 4,790 59,236
Fidelity Multi Asset Allocator Defensive Fund
35
Notes to the Financial Statements
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
UK Pound - - 80,243 80,243
US Dollar - - 9 9
Total - - 80,252 80,252
31/10/18 £'000 £'000 £'000 £'000
Euro - - 1 1
UK Pound - - 58,441 58,441
US Dollar - - 794 794
Total - - 59,236 59,236
^ Includes £80,156,000 in respect of the fund's liability to redeem all shares (2018: £58,363,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.00% rise or fall in the fund's market value (2018: 0.28%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.08% fall or rise in the fund's market value (2018: 0.09%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 19,154 10 0.05 - -
Mutual Fund 31,106 - - - -
Corporate actions 2 - - - -
Total 50,262 10 -
Total including transaction costs 50,272
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 14,540 6 0.04 - -
Mutual Fund 19,817 - - - -
Total 34,357 6 -
Total including transaction costs 34,351
Total as a percentage of average net assets*
0.02 %
0.00 %
Fidelity Multi Asset Allocator Defensive Fund
36
Notes to the Financial Statements
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 39,338 20 0.05 - -
Mutual Fund 51,969 - - - -
Derivative - 3 - - -
Total 91,307 23 -
Total including transaction costs 91,330
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 25,407 11 0.04 - -
Mutual Fund 64,120 - - - -
Corporate actions 67 - - - -
Total 89,594 11 -
Total including transaction costs 89,583
Total as a percentage of average net assets
0.05 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.13%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 27,720 - 21,421 (37)
Level 2: Observable market data 51,683 (9) 37,423 (757)
Level 3: Unobservable data - - - -
79,403 (9) 58,844 (794)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares
Shares in issue as at 31/10/19
A Accumulation Shares 183,728 2,555,323 (140,405) 2,598,646
Y Accumulation Shares 47,402,307 14,772,485 (5,010,984) 57,163,808
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £20,000 (2018: £13,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £163,000 (2018: £56,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £5,452,000 and £2,399,000 respectively (2018: £14,868,000 and £30,243,000).Amounts receivable at the year end in respect of investments sold of £4,000 (2018: nil) are included within sales awaiting settlement in Note 9.Amounts due at the year end in respect of investments purchased of £41,000 (2018: £10,000) are included within purchases awaiting settlement in Note 11.
Fidelity Multi Asset Allocator Defensive Fund
37
Notes to the Financial Statements
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (8) - - - - - (8)
JP Morgan 92 - - - - - 92
Morgan Stanley 1 - - - - - 1
Total 85 - - - - - 85
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 159 - - - - - 159
HSBC Global Markets 28 - - - - - 28
JP Morgan (3) - - - - - (3)
Northern Trust (754) - - - - - (754)
UBS - - (37) - - 67 30
Total (570) - (37) - - 67 (540)
18 Shareholders' funds
The fund has two share classes; Y Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.20%Y Accumulation Shares : 0.25%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 127.15 129.19 1.60
Y Accumulation Shares 134.44 137.00 1.90
Fidelity Multi Asset Allocator Defensive Fund
38
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 9 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.4504 - 0.4504 0.3567
Group 2 0.2143 0.2361 0.4504 0.3567
xxx xxx xxx xxx xxxY Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 1.6974 - 1.6974 1.5396
Group 2 0.8623 0.8351 1.6974 1.5396
xxx xxx xxx xxx xxx
Fidelity Multi Asset Allocator Growth Fund
39
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to increase the value of your investment over a period of 5 years or more through a portfolio providing global exposure to both lower and higher risk assets.
The fund will invest at least 70% into funds that use an ‘index tracking’ (also known as 'passive') investment management approach (these may include funds managed by Fidelity), with the aim of pursuing a lower cost investment approach. The fund can also invest directly into transferable securities, other collective investment schemes, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Through its investments, the fund aims to maintain an allocation of 40% in lower-risk assets (such as debt instruments including global government bonds, global corporate bonds and cash) and 60% higher-risk assets (including global equities, global emerging market equities, global smaller companies and global property securities). This allocation, as well as the breakdown of higher-risk and lower-risk assets, may change according to prevailing market conditions and the efficient management of the portfolio.
The fund is actively managed. The Investment Manager will, when selecting investments for the fund and for the purposes of monitoring risk, consider a custom blend of indices*. The Investment Manager has a limited degree of freedom relative to the blended index and may invest outside the blended index, to take advantage of investment opportunities. This means The fund’s investments and therefore performance may vary from, but is unlikely to be significantly different to, the index.
*42% MSCI World, 6% FTSE EPRA/ NAREIT, 6% MSCI Emerging Markets, 6% MSCI World small cap, 24% Bloomberg Barclays Global Governments Total Return and 16% Bloomberg Barclays Corporate Total Return GBP Hedged.
Performance and Portfolio ActivityThe fund delivered positive returns over the period. The allocation to growth assets, including global large and mid-cap stocks, emerging market equities and global real estate investment trusts (REIT) benefited from the continued support from central banks and encouraging corporate results. The allocation to global government and corporate bonds gained against a backdrop of declining government bond yields. The fund is managed to provide diversified and efficient exposure to global markets. It has a purely static strategic asset allocation – 40% of the portfolio is invested in lower risk defensive assets and 60% in higher risk growth assets. Among the underlying strategies, positions in Lyxor FTSE Actuaries UK Gilts ETF and iShares Overseas Government Bond Index Fund were sold. A new position was purchased in HSBC Global Government Bond Index Fund. Elsewhere, the holding in E-mini Russell 2000 Index futures was sold and the exposure to L&G Global Small Cap Equity Index Fund was raised.
OutlookThe fund’s asset allocation is not impacted by the market outlook. The fund is managed to provide diversified and efficient exposure to global markets and is rebalanced periodically to keep asset allocation in line with its long-term strategic asset allocation.
Chris Forgan & Nick PetersFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 4
Y Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Allocator Growth Fund
40
Comparative Performance Table
A Accumulation Shares Y Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share 140.42 143.43 137.80 148.37 150.29 143.33
Return before operating charges* 15.23 (1.31) 7.31 16.09 (1.55) 7.37
Operating charges (1.79) (1.70) (1.68) (0.39) (0.37) (0.41)
Return after operating charges* 13.44 (3.01) 5.63 15.70 (1.92) 6.96
Distributions (0.61) (0.70) (0.40) (2.05) (1.98) (1.61)
Retained distributions on accumulation shares 0.61 0.70 0.40 2.05 1.98 1.61
Closing net asset value per share 153.86 140.42 143.43 164.07 148.37 150.29
*after direct transaction costs of 0.02 0.02 0.07 0.02 0.02 0.07
Performance
Return after charges 9.6% (2.1%) 4.1% 10.6% (1.3%) 4.9%
Other information
Closing net asset value (£'000) 243 112 113 320,764 294,242 191,633
Closing number of shares 158,114 80,090 79,003 195,500,721 198,316,120 127,506,532
Operating charges 1.20% 1.17% 1.20% 0.25% 0.22% 0.28%
Direct transaction costs 0.02% 0.02% 0.05% 0.02% 0.02% 0.05%
Prices (pence per share)
Highest share price 157.30 147.40 143.70 167.40 155.60 150.50
Lowest share price 135.00 134.70 134.20 143.00 141.60 138.80
Fidelity Multi Asset Allocator Growth Fund
41
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 29,109 (7,408)
Revenue 5 5,548 4,811
Expenses 6 (812) (718)
Interest payable and similar charges 8 (3) (50)
Net revenue/(expense) before taxation 4,733 4,043
Taxation 7 (408) (380)
Net revenue/(expense) after taxation 4,325 3,663
Total return before distributions 33,434 (3,745)
Distributions 8 (4,325) (3,657)
Change in net assets attributable to shareholders from investment activities 29,109 (7,402)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 294,354 262,871
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 82,859 48,387
Amounts payable on cancellation of shares (89,322) (13,438)
(6,463) 34,949
Change in net assets attributable to shareholders from investment activities (see above) 29,109 (7,402)
Retained distribution on accumulation shares 8 4,007 3,936
Closing net assets attributable to shareholders 321,007 294,354
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 316,416 289,400
Current assets:
Debtors 9 1,967 1,552
Cash equivalents 3 4,062
Cash and bank balances 10 3,107 2,082
Total other assets 5,077 7,696
Total assets 321,493 297,096
Liabilities:
Investment liabilities (20) (2,449)
Creditors
Other creditors 11 (466) (293)
Total other liabilities (466) (293)
Total liabilities (486) (2,742)
Net assets attributable to shareholders 321,007 294,354
Fidelity Multi Asset Allocator Growth Fund
42
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 28,782 (280)
Gains/(losses) on derivative contracts+ 109 (1,525)
Gains/(losses) on forward currency contracts+ 55 (5,673)
Other currency gains/(losses) 22 (11)
ACD fee rebate/waiver to capital 141 78
Management fee rebate to capital - 3
Net capital gains/(losses) 29,109 (7,408)
+ These comprise:
Realised gains/(losses)++ 8,679 1,862
Unrealised gains/(losses) 20,267 (9,340)
Total 28,946 (7,478)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 2,286 2,098
Unfranked UK dividend distributions 576 650
Overseas dividend distributions 547 123
Interest distributions 1,783 1,315
Derivative revenue - 111
Management fee rebate to income 71 92
ACD fee rebate/waiver to income 280 204
Bank interest 5 218
Total revenue 5,548 4,811
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 812 718
812 718
Total expenses* 812 718
*The ACD is responsible for payment of all charges and expenses of the fund out of its investment management fees including audit fees amounting to £10,000 (including VAT) (2018: £10,000).
Fidelity Multi Asset Allocator Growth Fund
43
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 408 380
Overseas taxation 78 95
Double taxation relief (78) (95)
Total current taxation 408 380
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 4,733 4,043
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 947 809Effects of:
ACD fee waiver to capital 28 15
Double taxation relief (78) (95)
Overseas taxation 78 95
Revenue not included for tax purposes (567) (444)
Current tax charge/(credit) 408 380
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final 1 1
Y Accumulation Shares
Final 4,006 3,935
4,007 3,936
Add: Revenue deducted on cancellation of shares 978 107
Deduct: Revenue received on issue of shares (660) (386)
Net distributions for the year 4,325 3,657
Interest/other
Interest - 1
Derivative expense 2 -
Contract for difference finance costs 1 49
3 50
Total finance costs 4,328 3,707
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 4,325 3,663
Add back (revenue)/expenses transferred to capital:
Equalisation on conversions - (5)
Revenue b/f - (1)
4,325 3,657
Details of the distributions per share are set out in the Distribution Statement.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 1,852 1,390
Management fee rebate recoverable 4 89
ACD fee rebate/waiver recoverable 36 30
UK income tax recoverable 75 43
Total debtors 1,967 1,552
Fidelity Multi Asset Allocator Growth Fund
44
Notes to the Financial Statements
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers - 807
Cash and bank balances 3,107 1,275
Total cash and bank balances 3,107 2,082
11 Other creditors
31/10/19 31/10/18£'000 £'000
Purchases awaiting settlement 255 91
Accrued expenses 70 62
UK corporation tax payable 141 140
Total other creditors 466 293
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Singapore Dollar - 4 - 4
UK Pound 310,712 3,103 1,501 315,316
US Dollar 5,687 - - 5,687
Total 316,399 3,107 1,501 321,007
31/10/18 £'000 £'000 £'000 £'000
Euro (3) - - (3)
Japanese Yen (1) - - (1)
Russian Ruble (2) - - (2)
UK Pound 288,100 2,082 1,259 291,441
US Dollar 2,919 - - 2,919
Total 291,013 2,082 1,259 294,354
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile
The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers. At the year end, there is no significant interest rate risk on the fund.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.40% rise or fall in the fund's market value (2018: 0.25%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.04% fall or rise in the fund's market value (2018: 0.05%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives (2018: same).
Fidelity Multi Asset Allocator Growth Fund
45
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 49,470 23 0.05 - -
Mutual Fund 113,434 - - - -
Corporate actions 7 - - - -
Total 162,911 23 -
Total including transaction costs 162,934
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 46,994 28 0.06 - -
Mutual Fund 117,375 - - - -
Corporate actions 1 - - - -
Total 164,370 28 -
Total including transaction costs 164,342
Total as a percentage of average net assets*
0.02 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 84,453 42 0.05 - -
Mutual Fund 239,164 - - - -
Corporate actions 5 - - - -
Derivative - 15 - - -
Total 323,622 57 -
Total including transaction costs 323,679
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 28,153 9 0.03 - -
Mutual Fund 223,195 - - - -
Corporate actions 2 - - - -
Total 251,350 9 -
Total including transaction costs 251,341
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.08%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 77,343 - 68,705 (507)
Level 2: Observable market data 239,076 (20) 224,757 (1,942)
Level 3: Unobservable data - - - -
316,419 (20) 293,462 (2,449)
Fidelity Multi Asset Allocator Growth Fund
46
Notes to the Financial Statements
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares
Shares in issue as at 31/10/19
A Accumulation Shares 80,090 88,233 (10,209) 158,114
Y Accumulation Shares 198,316,120 52,682,433 (55,497,832) 195,500,721
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £70,000 (2018: £62,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.Income received from Fidelity funds of £2,286,000 (2018: £1,444,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £50,454,000 and £45,111,000 respectively (2018: £124,437,000 and £143,847,000).Amounts due at the year end in respect of investments purchased of £255,000 (2018: £91,000) are included within purchases awaiting settlement in Note 11.
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (17) - - - - - (17)
BNP Paribas 7 - - - - - 7
CIBC (1) - - - - - (1)
JP Morgan 177 - - - - - 177
National Australia Bank (1) - - - - - (1)
Total 165 - - - - - 165
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 408 - - - - - 408
HSBC Global Markets 79 - - - - - 79
JP Morgan (5) - - - - - (5)
Morgan Stanley (3) - - - - - (3)
Northern Trust (1,899) - - - - - (1,899)
Societe Generale (1) - - - - - (1)
State Street (2) - - - - - (2)
UBS - - (507) - - 807 300
Total (1,423) - (507) - - 807 (1,123)
18 Shareholders' funds
The fund has two share classes; Y Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.20%Y Accumulation Shares : 0.25%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 153.86 157.59 2.42
Y Accumulation Shares 164.07 168.40 2.64
Fidelity Multi Asset Allocator Growth Fund
47
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 9 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.6146 - 0.6146 0.7018
Group 2 - 0.6146 0.6146 0.7018
xxx xxx xxx xxx xxxY Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 2.0491 - 2.0491 1.9840
Group 2 0.7968 1.2523 2.0491 1.9840
xxx xxx xxx xxx xxx
Fidelity Multi Asset Allocator Strategic Fund
48
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to increase the value of your investment over a period of 5 years or more through a portfolio providing global exposure to both lower and higher risk assets.
The fund will invest at least 70% into funds that use an ‘index tracking’ (also known as 'passive') investment management approach (these may include funds managed by Fidelity), with the aim of pursuing a lower cost investment approach. The fund can also invest directly into transferable securities, other collective investment schemes, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Through its investments, the fund aims to maintain an allocation of 60% in lower-risk assets (such as debt instruments including global government bonds, global corporate bonds and cash) and 40% higher-risk assets (such as global equities, global emerging market equities, global smaller companies and global property securities). This allocation, as well as the breakdown of higher-risk and lower-risk assets, may change according to prevailing market conditions and the efficient management of the portfolio.
The fund is actively managed. The Investment Manager will, when selecting investments for the fund and for the purposes of monitoring risk, consider a custom blend of indices*. The Investment Manager has a limited degree of freedom relative to the blended index and may invest outside the blended index, to take advantage of investment opportunities. This means the fund’s investments and therefore performance may vary from, but is unlikely to be significantly different to, the index.
*28% MSCI World, 4% FTSE EPRA/ NAREIT, 4% MSCI Emerging Markets, 4% MSCI World small cap, 36% Bloomberg Barclays Global Governments Total Return and 24% Bloomberg Barclays Corporate Total Return GBP Hedged.
Performance and Portfolio ActivityThe fund delivered positive returns over the period. The allocation to global government and corporate bonds gained against a backdrop of declining government bond yields. Global and emerging market equities, as well as global real estate investment trusts (REIT) benefited from the continued support from central banks and encouraging corporate results. The fund is managed to provide diversified and efficient exposure to global markets. It has a purely static strategic asset allocation – 60% of the portfolio is invested in lower risk defensive assets and 40% in higher risk growth assets. Among the underlying strategies, positions in Lyxor FTSE Actuaries UK Gilts ETF and iShares Overseas Government Bond Index Fund were sold. A new position was purchased in HSBC Global Government Bond Index Fund. Elsewhere, the holding in E-mini Russell 2000 Index futures was sold and the exposure to L&G Global Small Cap Equity Index Fund was raised.
OutlookThe fund’s asset allocation is not impacted by the market outlook. The fund is managed to provide diversified and efficient exposure to global markets and is rebalanced periodically to keep asset allocation in line with its long-term strategic asset allocation.
Chris Forgan & Nick PetersFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 4
Y Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Allocator Strategic Fund
49
Comparative Performance Table
A Accumulation Shares Y Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share 131.75 134.63 131.13 137.76 139.71 135.01
Return before operating charges* 13.65 (1.28) 5.09 14.12 (1.61) 5.08
Operating charges (1.69) (1.60) (1.59) (0.36) (0.34) (0.38)
Return after operating charges* 11.96 (2.88) 3.50 13.76 (1.95) 4.70
Distributions (0.54) (0.61) (0.29) (1.76) (1.68) (1.35)
Retained distributions on accumulation shares 0.54 0.61 0.29 1.76 1.68 1.35
Closing net asset value per share 143.71 131.75 134.63 151.52 137.76 139.71
*after direct transaction costs of 0.02 0.02 0.08 0.02 0.02 0.08
Performance
Return after charges 9.1% (2.1%) 2.7% 10.0% (1.4%) 3.5%
Other information
Closing net asset value (£'000) 1,814 465 538 151,229 118,037 37,967
Closing number of shares 1,262,518 353,048 399,263 99,807,912 85,683,457 27,175,688
Operating charges 1.20% 1.20% 1.20% 0.25% 0.25% 0.28%
Direct transaction costs 0.01% 0.02% 0.06% 0.01% 0.02% 0.06%
Prices (pence per share)
Highest share price 146.30 136.90 134.90 154.10 142.70 139.90
Lowest share price 128.70 128.80 128.30 134.80 134.10 132.20
Fidelity Multi Asset Allocator Strategic Fund
50
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 10,650 (3,057)
Revenue 5 2,152 1,935
Expenses 6 (342) (302)
Interest payable and similar charges 8 (1) (15)
Net revenue/(expense) before taxation 1,809 1,618
Taxation 7 (224) (206)
Net revenue/(expense) after taxation 1,585 1,412
Total return before distributions 12,235 (1,645)
Distributions 8 (1,588) (1,404)
Change in net assets attributable to shareholders from investment activities 10,647 (3,049)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 118,739 115,851
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 32,280 17,800
Amounts payable on cancellation of shares (10,391) (13,310)
21,889 4,490
Change in net assets attributable to shareholders from investment activities (see above) 10,647 (3,049)
Retained distribution on accumulation shares 8 1,768 1,447
Closing net assets attributable to shareholders 153,043 118,739
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 151,627 118,383
Current assets:
Debtors 9 709 230
Cash equivalents 2 1,115
Cash and bank balances 10 1,352 691
Total other assets 2,063 2,036
Total assets 153,690 120,419
Liabilities:
Investment liabilities (14) (1,307)
Creditors
Other creditors 11 (633) (373)
Total other liabilities (633) (373)
Total liabilities (647) (1,680)
Net assets attributable to shareholders 153,043 118,739
Fidelity Multi Asset Allocator Strategic Fund
51
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 10,390 1,346
Gains/(losses) on derivative contracts+ 33 (548)
Gains/(losses) on forward currency contracts+ 189 (3,873)
Other currency gains/(losses) 1 (13)
Broker fee rebates - 1
ACD fee rebate/waiver to capital 37 28
Management fee rebate to capital - 2
Net capital gains/(losses) 10,650 (3,057)
+ These comprise:
Realised gains/(losses)++ 1,377 1,281
Unrealised gains/(losses) 9,235 (4,356)
Total 10,612 (3,075)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 651 588
Unfranked UK dividend distributions 155 149
Overseas dividend distributions 77 30
Interest distributions 1,098 910
Derivative revenue - 58
Management fee rebate to income 39 55
ACD fee rebate/waiver to income 131 92
Bank interest 1 53
Total revenue 2,152 1,935
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 342 302
342 302
Total expenses* 342 302
*The ACD is responsible for payment of all charges and expenses of the fund out of its investment management fees including audit fees amounting to £10,000 (including VAT) (2018: £10,000).
Fidelity Multi Asset Allocator Strategic Fund
52
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 224 206
Overseas taxation 21 23
Double taxation relief (21) (23)
Total current taxation 224 206
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 1,809 1,618
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 362 324Effects of:
Double taxation relief (21) (23)
Management fee rebate 7 6
Overseas taxation 21 23
Revenue not included for tax purposes (145) (124)
Current tax charge/(credit) 224 206
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final 7 2
Y Accumulation Shares
Final 1,761 1,443
MoneyBuilder Asset Allocator Accumulation Shares*
Final - 2
1,768 1,447
Add: Revenue deducted on cancellation of shares 62 77
Deduct: Revenue received on issue of shares (242) (120)
Net distributions for the year 1,588 1,404
Interest/other
Interest - 1
Derivative expense 1 -
Contract for difference finance costs - 14
1 15
Total finance costs 1,589 1,419
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 1,585 1,412
Add back (revenue)/expenses transferred to capital:
Equalisation on conversions 3 (8)
1,588 1,404
Details of the distributions per share are set out in the Distribution Statement.
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Allocator Strategic Fund
53
Notes to the Financial Statements
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 666 4
Sales awaiting settlement 3 134
Management fee rebate recoverable 3 53
ACD fee rebate/waiver recoverable 17 13
UK corporation tax recoverable - 16
UK income tax recoverable 20 10
Total debtors 709 230
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers - 252
Cash and bank balances 1,352 439
Total cash and bank balances 1,352 691
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 8 164
Accrued expenses 34 26
UK corporation tax payable 278 183
Purchases awaiting settlement 313 -
Total other creditors 633 373
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposure
Euro (2) - - (2)Currency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
UK Pound 150,056 1,346 76 151,478
US Dollar 1,559 6 - 1,565
Total 151,615 1,352 76 153,043
31/10/18 £'000 £'000 £'000 £'000
Japanese Yen (1) - - (1)
UK Pound 118,087 691 (143) 118,635
US Dollar 107 - - 107
Total 118,191 691 (143) 118,739
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Fidelity Multi Asset Allocator Strategic Fund
54
Notes to the Financial Statements
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
UK Pound 53,910 - 98,201 152,111
US Dollar 6 - 1,573 1,579
Total 53,916 - 99,774 153,690
31/10/18 £'000 £'000 £'000 £'000
UK Pound 45,358 - 73,650 119,008
US Dollar - - 1,411 1,411
Total 45,358 - 75,061 120,419
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
UK Pound - - 153,676 153,676
US Dollar - - 14 14
Total - - 153,690 153,690
31/10/18 £'000 £'000 £'000 £'000
Euro - - 2 2
Japanese Yen - - 1 1
UK Pound - - 119,112 119,112
US Dollar - - 1,304 1,304
Total - - 120,419 120,419
^ Includes £153,043,000 in respect of the fund's liability to redeem all shares (2018: £118,739,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.22% rise or fall in the fund's market value (2018: 0.01%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.06% fall or rise in the fund's market value (2018: 0.07%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
Fidelity Multi Asset Allocator Strategic Fund
55
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 20,678 10 0.05 - -
Mutual Fund 54,001 - - - -
Corporate actions 3 - - - -
Total 74,682 10 -
Total including transaction costs 74,692
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 15,414 8 0.05 - -
Mutual Fund 36,251 - - - -
Total 51,665 8 -
Total including transaction costs 51,657
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 45,240 22 0.05 - -
Mutual Fund 112,851 - - - -
Corporate actions 1 - - - -
Derivative - 6 - - -
Total 158,092 28 -
Total including transaction costs 158,120
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 20,346 7 0.04 - -
Mutual Fund 123,028 - - - -
Corporate actions 240 - - - -
Total 143,614 7 -
Total including transaction costs 143,607
Total as a percentage of average net assets
0.03 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.10%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 40,336 - 32,586 (140)
Level 2: Observable market data 111,293 (14) 86,912 (1,167)
Level 3: Unobservable data - - - -
151,629 (14) 119,498 (1,307)
Fidelity Multi Asset Allocator Strategic Fund
56
Notes to the Financial Statements
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares 353,048 993,271 (83,801) - 1,262,518
MoneyBuilder Asset Allocator Accumulation Shares 177,259 60,877 (36,236) (201,900) -
Y Accumulation Shares 85,683,457 21,008,071 (7,078,561) 194,945 99,807,912
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £34,000 (2018: £26,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £650,000 (2018: £412,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £16,151,000 and £7,392,000 respectively (2018: £46,259,000 and £61,934,000).Amounts receivable at the year end in respect of investments sold of £2,000 (2018: £53,000) are included within sales awaiting settlement in Note 9.Amounts due at the year end in respect of investments purchased of £130,000 (2018: nil) are included within purchases awaiting settlement in Note 9.
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (12) - - - - - (12)
BNP Paribas 4 - - - - - 4
CIBC (1) - - - - - (1)
JP Morgan 132 - - - - - 132
Total 123 - - - - - 123
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 244 - - - - - 244
HSBC Global Markets 46 - - - - - 46
JP Morgan (4) - - - - - (4)
Northern Trust (1,152) - - - - - (1,152)
Societe Generale (1) - - - - - (1)
UBS - - (140) - - 252 112
Total (867) - (140) - - 252 (755)
18 Shareholders' funds
The fund has two share classes; Y Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.20%Y Accumulation Shares : 0.25%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 143.71 146.59 2.00
Y Accumulation Shares 151.52 155.00 2.30
Fidelity Multi Asset Allocator Strategic Fund
57
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 9 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.5413 - 0.5413 0.6066
Group 2 0.0384 0.5029 0.5413 0.6066
xxx xxx xxx xxx xxxY Accumulation Shares - final distribution No. 7 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 1.7640 - 1.7640 1.6838
Group 2 0.7007 1.0633 1.7640 1.6838
xxx xxx xxx xxx xxxMoneyBuilder Asset Allocator Accumulation Shares - final distribution No.9 in pence per shares^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.8965
Group 2 - - - 0.8965
xxx xxx xxx xxx xxx^ Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Balanced Income Fund
58
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to achieve an Income yield of 4-6% per annum over a typical market cycle (5-7 years). The fund also aims to increase the value of your investment over a period of 5 years or more.
Any income you may receive will vary depending on the share class of the fund into which you are invested.
The fund invests at least 70% into funds (including funds managed by Fidelity) which provide global exposure to a mixture of asset classes. The fund can also invest directly into transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes. The fund is actively managed without reference to a benchmark.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters: 20-100% income assets (such as bonds and cash) and 0-60% growth assets (such as equities, infrastructure securities and property securities). The fund’s asset allocation can be adjusted within the ranges in order to preserve capital or to take advantage of market opportunities.
Performance and Portfolio ActivityThe fund generated income in line with its objective and preserved capital during periods of market volatility. Moreover, it generated positive returns over the period. Equities and investment grade bonds were the largest contributors to returns, followed by high yield bonds and emerging market debt. Non-traditional assets such as infrastructure also added value. In contrast, equity and fixed income market hedges weighed on returns, as did the allocation to a reinsurance strategy. We sold our position in Australian government bonds following their strong performance and reduced the exposure to Fidelity Funds - US High Yield. New positions were purchased in Fidelity Funds - European High Yield and Fidelity Renaissance, which invests in high-quality credits. The allocation to Fidelity Funds - Emerging Market Local Currency Debt was also increased given its attractive valuations. We continue to hedge part of the fund’s equity market beta through short futures positions. This provides some protection to the portfolio against equity market volatility.
OutlookThe late-cycle environment and performance of markets continues to send mixed signals on the direction of markets. Our focus remains on balancing income with risk, but we are also allocating tactically to take advantage of opportunities arising from volatility and market dislocations.
Eugene Philalithis, Chris Forgan & George EfstathopoulosFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
Lovewell Blake FP Income Shares 4
W Accumulation Shares 3
W Income Shares 3
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Balanced Income Fund
59
Comparative Performance Table
W Income Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019
Opening net asset value per share* 107.61 112.18 111.35 100.00
Return before operating charges* 9.06 (0.45) 7.38 6.72
Operating charges (1.04) (1.02) (1.08) (0.98)
Return after operating charges* 8.02 (0.41) 6.30 5.74
Distributions (4.23) (4.16) (5.47) (2.42)
Retained distributions on accumulation shares - - - 2.42
Closing net asset value per share 111.40 107.61 112.18 105.74
*after direct transaction costs of - 0.01 0.02 -
Performance
Return after charges 7.5% (0.4%) 5.7% 5.7%
Other information
Closing net asset value (£'000) 62,468 39,549 4,593 3,407
Closing number of shares 56,075,467 36,753,591 4,094,891 3,221,929
Operating charges 0.94% 0.71% 0.96% 0.94%
Direct transaction costs 0% 0.01% 0.02% 0%
Prices (pence per share)
Highest share price 114.20 113.00 114.90 106.90
Lowest share price 104.00 107.30 107.50 99.95
Lovewell Blake FP Income Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 100.03 100.00
Return before operating charges* 8.08 2.13
Operating charges (0.87) (0.85)
Return after operating charges* 7.21 2.29
Distributions (3.68) (2.26)
Retained distributions on accumulation shares - -
Closing net asset value per share 103.56 100.03
*after direct transaction costs of - 0.01
Performance
Return after charges 7.2% 1.0%
Other information
Closing net asset value (£'000) 2,057 515
Closing number of shares 1,986,160 514,710
Operating charges 0.84% 0.32%
Direct transaction costs 0% 0.01%
Prices (pence per share)
Highest share price 106.10 103.70
Lowest share price 96.66 99.92
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Balanced Income Fund
60
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 2,024 (1,318)
Revenue 5 2,411 1,582
Expenses 6 (375) (260)
Interest payable and similar charges 8 (21) (20)
Net revenue/(expense) before taxation 2,015 1,302
Taxation 7 (237) (146)
Net revenue/(expense) after taxation 1,778 1,156
Total return before distributions 3,802 (162)
Distributions 8 (2,047) (1,350)
Change in net assets attributable to shareholders from investment activities 1,755 (1,512)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 44,764 28,640
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 27,296 20,996
Amounts payable on cancellation of shares (5,961) (3,416)
21,335 17,580
Change in net assets attributable to shareholders from investment activities (see above) 1,755 (1,512)
Retained distribution on accumulation shares 78 56
Closing net assets attributable to shareholders 67,932 44,764
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 62,846 42,710
Current assets:
Debtors 9 428 208
Cash equivalents 2,323 1,535
Cash and bank balances 10 3,453 2,662
Total other assets 6,204 4,405
Total assets 69,050 47,115
Liabilities:
Investment liabilities (310) (162)
Creditors
Distribution payable (516) (415)
Other creditors 11 (292) (1,774)
Total other liabilities (808) (2,189)
Total liabilities (1,118) (2,351)
Net assets attributable to shareholders 67,932 44,764
Fidelity Multi Asset Balanced Income Fund
61
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 1,784 (906)
Gains/(losses) on derivative contracts+ (3) 30
Gains/(losses) on forward currency contracts+ 198 (468)
Other currency gains/(losses) 1 -
Transaction charges (13) (6)
Broker fee rebates - 1
ACD fee rebate/waiver to capital 45 30
Management fee rebate to capital 12 1
Net capital gains/(losses) 2,024 (1,318)
+ These comprise:
Realised gains/(losses)++ (4,952) (5)
Unrealised gains/(losses) 6,931 (1,339)
Total 1,979 (1,344)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 465 265
Unfranked UK dividend distributions 99 68
Overseas dividend distributions 420 335
Interest distributions 1,143 760
Derivative revenue 11 1
ACD fee rebate/waiver to income 238 145
UK dividends 2 3
UK property income distributions 12 3
Bank interest 21 2
Total revenue 2,411 1,582
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 276 190
Registrar fees 53 36
Service charges 26 18
355 244Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 7 4
7 4Other expenses:
Audit fee 10 10
Other operating expenses 3 2
13 12
Total expenses 375 260
Fidelity Multi Asset Balanced Income Fund
62
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 237 146
Overseas taxation 2 -
Double taxation relief (2) -
Total current taxation 237 146
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 2,015 1,302
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 403 260Effects of:
ACD fee waiver to capital 2 -
Double taxation relief (2) -
Management fee rebate 9 6
Overseas taxation 2 -
Revenue not included for tax purposes (177) (120)
Current tax charge/(credit) 237 146
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares*
Final - 56
Y Income Shares
Final - 15
Interim 34 87
Gross paying Y Income Shares
Interim - 4
W Income Shares
Final 277 208
Interim 1,694 878
Gross paying N Income Shares
Interim - 169
W Accumulation Shares
Final 78 -
Lovewell Blake FP Income Shares
Final 8 3
Interim 41 4
2,132 1,424
Add: Revenue deducted on cancellation of shares 23 16
Deduct: Revenue received on issue of shares (108) (90)
Net distributions for the year 2,047 1,350
Interest/other
Derivative expense 8 18
Contract for difference finance costs 13 2
21 20
Total finance costs 2,068 1,370
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 1,778 1,156
Fidelity Multi Asset Balanced Income Fund
63
Notes to the Financial Statements
Add back (revenue)/expenses transferred to capital:
Service charges 25 17
Investment management fees 262 178
Equalisation on conversions (18) (1)
2,047 1,350
Details of the distributions per share are set out in the Distribution Statement.
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 248 86
Sales awaiting settlement - 1
Accrued revenue 106 80
Management fee rebate recoverable 1 1
ACD fee rebate/waiver recoverable 31 18
UK income tax recoverable 42 22
Total debtors 428 208
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 201 63
Cash and bank balances 3,252 2,599
Total cash and bank balances 3,453 2,662
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 5 675
Purchases awaiting settlement - 917
Accrued expenses 52 37
UK corporation tax payable 235 145
Total other creditors 292 1,774
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Australian Dollar 17 - - 17
Chinese Yuan Renminbi 36 - - 36
Euro 5,538 - 7 5,545
Hong Kong Dollar 48 - - 48
Japanese Yen (254) - - (254)
Swiss Franc 37 - - 37
UK Pound 40,096 3,447 (387) 43,156
US Dollar 19,341 6 - 19,347
Total 64,859 3,453 (380) 67,932
Fidelity Multi Asset Balanced Income Fund
64
Notes to the Financial Statements
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar 2 - - 2
Czech Koruna 2 - - 2
Euro 2,534 - 8 2,542
Hong Kong Dollar (2) - - (2)
Hungarian Forint 1 - - 1
Japanese Yen (10) - - (10)
Korean Won (1) - - (1)
Swiss Franc 10 - - 10
Turkish Lira (2) - - (2)
UK Pound 28,112 2,658 (1,989) 28,781
US Dollar 13,437 4 - 13,441
Total 44,083 2,662 (1,981) 44,764
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Australian Dollar - - 18 18
Swiss Franc - - 37 37
Chinese Yuan Renminbi - - 39 39
Euro 4,800 - 753 5,553
UK Pound 19,816 - 24,151 43,967
Hong Kong Dollar - - 50 50
Japanese Yen - - 12 12
US Dollar 15,727 - 3,647 19,374
Total 40,343 - 28,707 69,050
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar - - 3 3
Czech Koruna - - 2 2
Euro 2,082 - 466 2,548
Hungarian Forint - - 1 1
Japanese Yen - - 5 5
Swiss Franc - - 10 10
Turkish Lira - - 9 9
UK Pound 15,307 - 15,663 30,970
US Dollar 11,387 - 2,180 13,567
Total 28,776 - 18,339 47,115
The interest rate risk profile of the fund's financial liabilities was:
31/10/19 £'000 £'000 £'000 £'000
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^
Australian Dollar - - 1 1
Chinese Yuan Renminbi - - 3 3
Euro - - 8 8
UK Pound - - 68,743 68,743
Hong Kong Dollar - - 2 2
Japanese Yen - - 266 266
US Dollar - - 27 27
Total - - 69,050 69,050
Fidelity Multi Asset Balanced Income Fund
65
Notes to the Financial Statements
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar - - 1 1
Euro - - 6 6
Hong Kong Dollar - - 2 2
Japanese Yen - - 15 15
Korean Won - - 1 1
Turkish Lira - - 11 11
UK Pound - - 46,953 46,953
US Dollar - - 126 126
Total - - 47,115 47,115
^ Includes £67,932,000 in respect of the fund's liability to redeem all shares (2018: £44,764,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.20% rise or fall in the fund's market value (2018: 0.18%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 2.71% fall or rise in the fund's market value (2018: 3.02%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
At the year end the fund holds no derivatives that could impact it significantly (2018: same).
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 754 - 0.04 - -
Mutual Fund 22,822 - - - -
Corporate actions 1 - - - -
Total 23,577 - -
Total including transaction costs 23,577
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,102 1 0.06 - -
Mutual Fund 5,246 - - - -
Corporate actions 76 - - - -
Total 6,424 1 -
Total including transaction costs 6,423
Total as a percentage of average net assets*
0.00 %
0.00 %
Fidelity Multi Asset Balanced Income Fund
66
Notes to the Financial Statements
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 3,899 1 0.04 - -
Mutual Fund 24,176 3 0.01 - -
Corporate actions 43 - - - -
Total 28,118 4 -
Total including transaction costs 28,122
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,322 - 0.04 - -
Mutual Fund 10,580 1 0.01 - -
Corporate actions 121 - - - -
Total 12,023 1 -
Total including transaction costs 12,022
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.10% (2018: 0.14%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 9,254 (36) 4,868 (11)
Level 2: Observable market data 55,915 (274) 39,377 (151)
Level 3: Unobservable data - - - -
65,169 (310) 44,245 (162)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
Lovewell Blake FP Income Shares 514,710 1,528,509 (57,059) - 1,986,160
W Accumulation Shares - 1,635,970 (308,732) 1,894,691 3,221,929
W Income Shares 36,753,591 21,204,803 (4,822,311) 2,939,384 56,075,467
Y Accumulation Shares 1,434,844 148,820 (132,308) (1,451,356) -
Y Income Shares 2,691,684 419,031 (128,719) (2,981,996) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £37,000 (2018: £26,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £621,000 (2018: £26,000) are included in Note 5 and amounts receivable at the year end of £50,000 (2018: £31,000) are included within accrued revenue in Note 9.During the year, the aggregate value of purchases and sales in Fidelity funds were £9,844,000 and £5,211,000 respectively (2018: £9,168,000 and £5,683,000).Amounts due at the year end in respect of investments purchased of nil (2018: £457,000) are included within purchases awaiting settlement in Note 11.
Fidelity Multi Asset Balanced Income Fund
67
Notes to the Financial Statements
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (241) - - - - - (241)
BNP Paribas (2) - - - - - (2)
CIBC (2) - - - - - (2)
Citibank 50 - - - - - 50
JP Morgan 928 - - - - - 928
National Australia Bank 317 - - - - - 317
Royal Bank of Canada 11 - - - - - 11
State Street 12 - - - - - 12
UBS - - (27) - - 201 174
Total 1,073 - (27) - - 201 1,247
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 11 - - - - - 11
Citibank 1 - - - - - 1
HSBC Global Markets (16) - - - - - (16)
JP Morgan 1 - - - - - 1
Morgan Stanley (112) - - - - - (112)
National Australia Bank 2 - - - - - 2
Royal Bank of Canada 65 - - - - - 65
Societe Generale (7) - - - - - (7)
UBS - - 51 - - 63 114
Total (55) - 51 - - 63 59
18 Shareholders' funds
The fund has three share classes; W Income Shares, Lovewell Blake FP Income Shares and W Accumulation Shares. The annual management charge on each share class is as follows:W Income Shares : 0.50%W Accumulation Shares : 0.50%Lovewell Blake FP Income Shares : 0.55%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
W Income Shares 111.40 112.80 1.26
W Accumulation Shares 105.74 107.90 2.04
Lovewell Blake FP Income Shares 103.56 104.80 1.20
Fidelity Multi Asset Balanced Income Fund
68
Distribution Statement
for the year ended 31 October 2019W Income Shares - final distribution No. 73 in pence per share^Group 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.4941 - 0.4941 0.5667
Group 2 0.2098 0.2843 0.4941 0.5667
xxx xxx xxx xxx xxxW Income Shares - interim distributions in pence per share^For the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 62 0.2600 - 0.2600 0.2374
Distribution No. 63 0.2600 - 0.2600 0.2895
Distribution No. 64 0.3200 - 0.3200 0.2988
Distribution No. 65 0.3200 - 0.3200 0.2900
Distribution No. 66 0.3300 - 0.3300 0.3000
Distribution No. 67 0.3500 - 0.3500 0.3200
Distribution No. 68 0.3800 - 0.3800 0.3200
Distribution No. 69 0.3800 - 0.3800 0.3200
Distribution No. 70 0.3200 - 0.3200 0.3600
Distribution No. 71 0.4100 - 0.4100 0.3600
Distribution No. 72 0.4100 - 0.4100 0.5000Group 2
Distribution No. 62 - 0.2600 0.2600 0.2374
Distribution No. 63 - 0.2600 0.2600 0.2895
Distribution No. 64 - 0.3200 0.3200 0.2988
Distribution No. 65 - 0.3200 0.3200 0.2900
Distribution No. 66 - 0.3300 0.3300 0.3000
Distribution No. 67 - 0.3500 0.3500 0.3200
Distribution No. 68 - 0.3800 0.3800 0.3200
Distribution No. 69 0.0216 0.3584 0.3800 0.3200
Distribution No. 70 0.0440 0.2760 0.3200 0.3600
Distribution No. 71 - 0.4100 0.4100 0.3600
Distribution No. 72 0.0396 0.3704 0.4100 0.5000
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 1 in pence per share^Group 1 - See belowGroup 2 - Shares purchased from 13 February 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
15/12/19
Group 1 2.4196 - 2.4196
Group 2 1.4164 1.0032 2.4196
xxx xxx xxx xxx xxx
Fidelity Multi Asset Balanced Income Fund
69
Distribution Statement
Lovewell Blake FP Income Shares - final distribution No. 19 in pence per shareGroup 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.4221 - 0.4221 0.5375
Group 2 0.1156 0.3065 0.4221 0.5375
xxx xxx xxx xxx xxxLovewell Blake FP Income Shares - interim distributions in pence per shareFor the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 8 0.2245 - 0.2245 -
Distribution No. 9 0.2291 - 0.2291 -
Distribution No. 10 0.2772 - 0.2772 -
Distribution No. 11 0.2786 - 0.2786 -
Distribution No. 12 0.2905 - 0.2905 -
Distribution No. 13 0.3065 - 0.3065 -
Distribution No. 14 0.3352 - 0.3352 0.2785
Distribution No. 15 0.3377 - 0.3377 0.2956
Distribution No. 16 0.2790 - 0.2790 0.3378
Distribution No. 17 0.3429 - 0.3429 0.3389
Distribution No. 18 0.3583 - 0.3583 0.4725Group 2
Distribution No. 8 - 0.2245 0.2245 -
Distribution No. 9 - 0.2291 0.2291 -
Distribution No. 10 - 0.2772 0.2772 -
Distribution No. 11 - 0.2786 0.2786 -
Distribution No. 12 - 0.2905 0.2905 -
Distribution No. 13 - 0.3065 0.3065 -
Distribution No. 14 - 0.3352 0.3352 0.2785
Distribution No. 15 0.0526 0.2851 0.3377 0.2956
Distribution No. 16 0.0264 0.2526 0.2790 0.3378
Distribution No. 17 0.0120 0.3309 0.3429 0.3389
Distribution No. 18 0.0295 0.3288 0.3583 0.4725
xxx xxx xxx xxx xxx
Fidelity Multi Asset Balanced Income Fund
70
Notes to the Financial Statements
Y Income Shares - interim distributions in pence per share^For the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 62 0.2595 - 0.2595 0.2346
Distribution No. 63 0.2584 - 0.2584 0.2854
Distribution No. 64 0.3193 - 0.3193 0.3073
Distribution No. 65 0.3194 - 0.3194 0.2945Group 2
Distribution No. 62 - 0.2595 0.2595 0.2346
Distribution No. 63 - 0.2584 0.2584 0.2854
Distribution No. 64 - 0.3193 0.3193 0.3073
Distribution No. 65 - 0.3194 0.3194 0.2945
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Income & Growth Fund
71
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to achieve an Income yield of 4-6% per annum over a typical market cycle (5-7 years). The fund also aims to increase the value of your investment over a period of 5 years or more which will typically be in line with inflation.
Any income you may receive will vary depending on the share class of the fund into which you are invested and is not guaranteed.
The fund invests at least 70% into funds (including funds managed by Fidelity) which provide global exposure to a mixture of asset classes. The fund can also invest directly into transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes. The fund is actively managed without reference to a benchmark.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters: 25-100% growth assets (such as equities, infrastructure securities and real estate securities) and 0-100% income assets (such as bonds and cash). The fund’s asset allocation can be adjusted within the ranges in order to preserve capital or to take advantage of market opportunities.
Performance and Portfolio ActivityThe fund generated income in line with its objective and preserved capital during periods of market volatility. Moreover, it generated positive returns over the period. Equities were the largest contributors to returns, followed by investment grade bonds, high yield bonds and emerging market debt. Non-traditional assets such as infrastructure also added value. In contrast, equity and fixed income market hedges weighed on returns, as did the allocation to a reinsurance strategy. We sold our position in Australian government bonds following their strong performance and reduced the exposure to Fidelity Funds - US High Yield. We bought new positions in Fidelity Funds - European High Yield given its attractive valuations, and Fidelity Renaissance, which invests in high-quality credits. We continue to hedge part of the fund’s equity market beta through short futures positions. This provides some protection to the portfolio against equity market volatility.
OutlookThe late-cycle environment and performance of markets continues to send mixed signals on the direction of markets. Our focus remains on balancing income with risk, but we are also allocating tactically to take advantage of opportunities arising from volatility and market dislocations.
Eugene Philalithis, Chris Forgan & George EfstathopoulosFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
Lovewell Blake FP Income Shares 4
W Accumulation Shares 3
W Income Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Income & Growth Fund
72
Comparative Performance Table
W Income Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019
Opening net asset value per share* 108.98 113.93 113.15 100.00
Return before operating charges* 9.65 (0.64) 6.03 0.99
Operating charges (1.07) (1.03) (0.86) (0.99)
Return after operating charges* 8.58 (0.54) 5.17 -
Distributions (4.31) (4.41) (4.39) (2.31)
Retained distributions on accumulation shares - - - 2.31
Closing net asset value per share 113.25 108.98 113.93 105.72
*after direct transaction costs of - 0.02 0.02 -
Performance
Return after charges 7.9% (0.5%) 4.6% 5.7%
Other information
Closing net asset value (£'000) 52,332 30,522 28,505 3,470
Closing number of shares 46,208,313 28,006,828 25,020,855 3,282,531
Operating charges 0.95% 0.93% 0.98% 0.95%
Direct transaction costs 0% 0.01% 0.02% 0%
Prices (pence per share)
Highest share price 116.40 114.80 117.30 107.10
Lowest share price 105.50 108.70 108.80 100.00
Lovewell Blake FP Income Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 99.79 100.00
Return before operating charges* 8.86 1.99
Operating charges (0.88) (0.83)
Return after operating charges* 7.98 2.22
Distributions (3.91) (2.43)
Retained distributions on accumulation shares - -
Closing net asset value per share 103.86 99.79
*after direct transaction costs of - 0.02
Performance
Return after charges 8.0% 2.2%
Other information
Closing net asset value (£'000) 9,459 2,290
Closing number of shares 9,107,428 2,294,693
Operating charges 0.85% 0.83%
Direct transaction costs 0% 0.01%
Prices (pence per share)
Highest share price 106.70 104.10
Lowest share price 96.53 99.68
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Income & Growth Fund
73
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 2,117 (1,386)
Revenue 5 2,228 1,614
Expenses 6 (343) (256)
Interest payable and similar charges 8 (14) (35)
Net revenue/(expense) before taxation 1,871 1,323
Taxation 7 (202) (130)
Net revenue/(expense) after taxation 1,669 1,193
Total return before distributions 3,786 (193)
Distributions 8 (1,911) (1,377)
Change in net assets attributable to shareholders from investment activities 1,875 (1,570)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 37,001 32,924
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 28,221 11,024
Amounts payable on cancellation of shares (1,912) (5,455)
26,309 5,569
Change in net assets attributable to shareholders from investment activities (see above) 1,875 (1,570)
Retained distribution on accumulation shares 8 76 78
Closing net assets attributable to shareholders 65,261 37,001
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 60,697 35,353
Current assets:
Debtors 9 422 492
Cash equivalents 1,877 1,079
Cash and bank balances 10 3,314 1,126
Total other assets 5,613 2,697
Total assets 66,310 38,050
Liabilities:
Investment liabilities (276) (143)
Creditors
Distribution payable (524) (358)
Other creditors 11 (249) (548)
Total other liabilities (773) (906)
Total liabilities (1,049) (1,049)
Net assets attributable to shareholders 65,261 37,001
Fidelity Multi Asset Income & Growth Fund
74
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 1,752 (1,105)
Gains/(losses) on derivative contracts+ 52 44
Gains/(losses) on forward currency contracts+ 249 (371)
Other currency gains/(losses) 4 2
Transaction charges (12) 2
ACD fee rebate/waiver to capital 47 41
Management fee rebate to capital 14 1
Compensation payments 11 -
Net capital gains/(losses) 2,117 (1,386)
+ These comprise:
Realised gains/(losses)++ (3,725) (782)
Unrealised gains/(losses) 5,778 (650)
Total 2,053 (1,432)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 498 343
Unfranked UK dividend distributions 99 101
Overseas dividend distributions 412 372
Interest distributions 950 643
Derivative revenue 9 1
ACD fee rebate/waiver to income 225 135
UK dividends 3 -
UK property income distributions 12 18
Bank interest 20 1
Total revenue 2,228 1,614
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 258 188
Registrar fees 44 35
Service charges 22 17
324 240Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 6 4
6 4Other expenses:
Audit fee 10 10
Other operating expenses 3 2
13 12
Total expenses 343 256
Fidelity Multi Asset Income & Growth Fund
75
Notes to the Financial Statements
7 Taxation31/10/19 31/10/18
£'000 £'000a) Analysis of charge/(credit) for the year
UK corporation tax 203 130
Overseas taxation 1 3
Double taxation relief (2) (3)
Total current taxation 202 130
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 1,871 1,323
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 374 265Effects of:
ACD fee waiver to capital 9 8
Double taxation relief (2) (3)
Management fee rebate 3 -
Overseas taxation 1 3
Revenue not included for tax purposes (183) (143)
Current tax charge/(credit) 202 130
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs31/10/19 31/10/18
£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares*
Final - 78
Y Income Shares
Final - 9
Interim 20 66
W Income Shares
Final 242 163
Interim 1,416 1,050
W Accumulation Shares
Final 76 -
Lovewell Blake FP Income Shares
Final 63 13
Interim 192 10
2,009 1,389
Add: Revenue deducted on cancellation of shares 9 29
Deduct: Revenue received on issue of shares (107) (41)
Net distributions for the year 1,911 1,377
Interest/other
Derivative expense 3 33
Contract for difference finance costs 11 2
14 35
Total finance costs 1,925 1,412
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 1,669 1,193
Add back (revenue)/expenses transferred to capital:
Service charges 21 16
Investment management fees 243 168
Equalisation on conversions (22) -
1,911 1,377
Details of the distributions per share are set out in the Distribution Statement.
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Income & Growth Fund
76
Notes to the Financial Statements
9 Debtors31/10/19 31/10/18
£'000 £'000
Total debtors 422 492
Amounts receivable for issue of shares 262 12
Sales awaiting settlement - 374
Accrued revenue 94 73
Management fee rebate recoverable 1 1
ACD fee rebate/waiver recoverable 30 15
UK income tax recoverable 35 17
10 Cash and bank balances31/10/19 31/10/18
£'000 £'000
Amounts held at futures clearing houses and brokers 153 58
Cash and bank balances 3,161 1,068
Total cash and bank balances 3,314 1,126
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares - 17
Purchases awaiting settlement - 374
Accrued expenses 49 30
UK corporation tax payable 200 127
Total other creditors 249 548
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Australian Dollar 26 - - 26
Chinese Yuan Renminbi 21 - - 21
Euro 6,231 - 2 6,233
Hong Kong Dollar 75 - - 75
Japanese Yen (213) 14 - (199)
Swiss Franc 40 - - 40
UK Pound 36,721 3,295 (353) 39,663
US Dollar 19,397 5 - 19,402
Total 62,298 3,314 (351) 65,261
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar 2 - - 2
Czech Koruna 2 - - 2
Euro 2,894 - 3 2,897
Hong Kong Dollar (3) - - (3)
Hungarian Forint 1 - - 1
Japanese Yen (12) - - (12)
Korean Won (2) - - (2)
Swiss Franc 12 - - 12
Turkish Lira (3) - - (3)
UK Pound 23,956 1,125 (417) 24,664
US Dollar 9,442 1 - 9,443
Total 36,289 1,126 (414) 37,001
^ includes cash equivalents where appropriate.
Fidelity Multi Asset Income & Growth Fund
77
Notes to the Financial Statements
The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Australian Dollar - - 27 27
Chinese Yuan Renminbi - - 22 22
Euro 5,630 - 606 6,236
Hong Kong Dollar - - 77 77
Japanese Yen 14 - 29 43
Swiss Franc - - 40 40
UK Pound 15,209 - 25,230 40,439
US Dollar 14,079 - 5,347 19,426
Total 34,932 - 31,378 66,310
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar - - 2 2
Czech Koruna - - 2 2
Euro 2,606 - 300 2,906
Hungarian Forint - - 2 2
Japanese Yen - - 2 2
Swiss Franc - - 12 12
Thai Baht - - 1 1
Turkish Lira - - 13 13
UK Pound 7,850 - 17,719 25,569
US Dollar 7,167 - 2,374 9,541
Total 17,623 - 20,427 38,050
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
Australian Dollar - - 1 1
Chinese Yuan Renminbi - - 1 1
Euro - - 3 3
Hong Kong Dollar - - 2 2
Japanese Yen - - 242 242
UK Pound - - 66,037 66,037
US Dollar - - 24 24
Total - - 66,310 66,310
31/10/18 £'000 £'000 £'000 £'000
Euro - - 9 9
Hong Kong Dollar - - 3 3
Hungarian Forint - - 1 1
Japanese Yen - - 14 14
Korean Won - - 2 2
Thai Baht - - 1 1
Turkish Lira - - 16 16
UK Pound - - 37,906 37,906
US Dollar - - 98 98
Total - - 38,050 38,050
^ Includes £65,261,000 in respect of the fund's liability to redeem all shares (2018: £37,001,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Fidelity Multi Asset Income & Growth Fund
78
Notes to the Financial Statements
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.21% rise or fall in the fund's market value (2018: 0.20%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 2.21% fall or rise in the fund's market value (2018: 2.28%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
At the year end the fund holds no derivatives that could impact it significantly (2018: same).
Equity derivatives
The fund can use derivatives for investment purposes. At the year end, the fund holds no derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 1,205 - 0.03 - -
Mutual Fund 26,291 - - - -
Corporate actions 1 - - - -
Derivative - 1 - - -
Total 27,497 1 -
Total including transaction costs 27,498
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,150 1 0.06 - -
Mutual Fund 3,901 - - - -
Corporate actions 87 - - - -
Derivative - 1 - - -
Total 5,138 2 -
Total including transaction costs 5,136
Total as a percentage of average net assets*
0.00 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 2,186 1 0.04 - -
Mutual Fund 14,106 1 0.01 - -
Corporate actions 41 - - - -
Total 16,333 2 -
Total including transaction costs 16,335
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,554 1 0.06 - -
Mutual Fund 10,566 1 0.01 - -
Corporate actions 113 - - - -
Total 12,233 2 -
Total including transaction costs 12,231
Total as a percentage of average net assets
0.01 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.10% (2018: 0.13%).
Fidelity Multi Asset Income & Growth Fund
79
Notes to the Financial Statements
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 9,527 (26) 5,222 (8)
Level 2: Observable market data 53,047 (250) 31,210 (135)
Level 3: Unobservable data - - - -
62,574 (276) 36,432 (143)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
Lovewell Blake FP Income Shares 2,294,693 6,879,690 (66,955) - 9,107,428
W Accumulation Shares - 1,108,617 (239,243) 2,413,157 3,282,531
W Income Shares 28,006,828 17,762,982 (1,240,377) 1,678,880 46,208,313
Y Accumulation Shares 1,854,720 63,553 (115,714) (1,802,559) -
Y Income Shares 1,629,154 122,847 (51,673) (1,700,328) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £35,000 (2018: £21,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5 and amounts receivable at the year end are included within the ACD fee rebate/waiver recoverable in note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £526,000 (2018: £10,000) is included in Note 5 and amounts receivable at the year end of £49,000 (2018: £34,000) are included within accrued revenue in Note 9.During the year, the aggregate value of purchases and sales in Fidelity funds were £10,735,000 and £3,945,000 respectively (2018: £4,024,000 and £4,964,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH (229) - - - - - (229)
BNP Paribas 5 - - - - - 5
CIBC (2) - - - - - (2)
Citibank 64 - - - - - 64
HSBC Global Markets - 18 - - - - 18
JP Morgan 900 - - - - - 900
National Australia Bank 404 - - - - - 404
Northern Trust 1 - - - - - 1
Royal Bank of Canada (6) - - - - - (6)
State Street 10 - - - - - 10
UBS - - (16) - - 153 137
Total 1,147 18 (16) - - 153 1,302
Fidelity Multi Asset Income & Growth Fund
80
Notes to the Financial Statements
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 13 - - - - - 13
BNP Paribas (9) - - - - - (9)
Citibank 1 - - - - - 1
HSBC Global Markets (13) - - - - - (13)
JP Morgan (1) - - - - - (1)
Morgan Stanley (88) - - - - - (88)
National Australia Bank 2 - - - - - 2
Royal Bank of Canada 73 - - - - - 73
Societe Generale (3) - - - - - (3)
State Street 2 - - - - - 2
UBS - - 77 - - 58 135
Total (23) - 77 - - 58 112
18 Shareholders' funds
The fund has three share classes; W Income Shares, Lovewell Blake FP Income Shares and W Accumulation Shares. The annual management charge on each share class is as follows:W Income Shares : 0.50%W Accumulation Shares : 0.50%Lovewell Blake FP Income Shares : 0.55%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
W Income Shares 113.25 114.70 1.28
W Accumulation Shares 105.72 107.80 1.97
Lovewell Blake FP Income Shares 103.86 105.09 1.18
Fidelity Multi Asset Income & Growth Fund
81
Distribution Statement
for the year ended 31 October 2019W Income Shares - final distribution No. 73 in pence per share^Group 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.5228 - 0.5228 0.5833
Group 2 0.1979 0.3249 0.5228 0.5833
xxx xxx xxx xxx xxxW Income Shares - interim distributions in pence per share^For the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Net revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 62 0.2800 - 0.2800 0.2900
Distribution No. 63 0.2800 - 0.2800 0.2900
Distribution No. 64 0.3200 - 0.3200 0.3100
Distribution No. 65 0.3200 - 0.3200 0.2800
Distribution No. 66 0.3300 - 0.3300 0.3100
Distribution No. 67 0.3500 - 0.3500 0.3400
Distribution No. 68 0.3700 - 0.3700 0.3400
Distribution No. 69 0.3700 - 0.3700 0.3400
Distribution No. 70 0.3300 - 0.3300 0.3800
Distribution No. 71 0.4200 - 0.4200 0.4000
Distribution No. 72 0.4200 - 0.4200 0.5500Group 2
Distribution No. 62 0.0521 0.2279 0.2800 0.2900
Distribution No. 63 - 0.2800 0.2800 0.2900
Distribution No. 64 - 0.3200 0.3200 0.3100
Distribution No. 65 - 0.3200 0.3200 0.2800
Distribution No. 66 - 0.3300 0.3300 0.3100
Distribution No. 67 - 0.3500 0.3500 0.3400
Distribution No. 68 - 0.3700 0.3700 0.3400
Distribution No. 69 0.0239 0.3461 0.3700 0.3400
Distribution No. 70 0.0348 0.2952 0.3300 0.3800
Distribution No. 71 - 0.4200 0.4200 0.4000
Distribution No. 72 0.0063 0.4137 0.4200 0.5500
xxx xxx xxx xxx xxxLovewell Blake FP Income Shares - final distribution No. 19 in pence per shareGroup 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.6891 - 0.6891 0.5604
Group 2 0.3950 0.2941 0.6891 0.5604
xxx xxx xxx xxx xxx
Fidelity Multi Asset Income & Growth Fund
82
Distribution Statement
Lovewell Blake FP Income Shares - interim distributions in pence per shareFor the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Net revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 8 0.2423 - 0.2423 -
Distribution No. 9 0.2367 - 0.2367 -
Distribution No. 10 0.2751 - 0.2751 -
Distribution No. 11 0.2776 - 0.2776 -
Distribution No. 12 0.2477 - 0.2477 -
Distribution No. 13 0.2907 - 0.2907 -
Distribution No. 14 0.3684 - 0.3684 0.3174
Distribution No. 15 0.3288 - 0.3288 0.3162
Distribution No. 16 0.2453 - 0.2453 0.3549
Distribution No. 17 0.3491 - 0.3491 0.3766
Distribution No. 18 0.3624 - 0.3624 0.5074Group 2
Distribution No. 8 - 0.2423 0.2423 -
Distribution No. 9 - 0.2367 0.2367 -
Distribution No. 10 - 0.2751 0.2751 -
Distribution No. 11 - 0.2776 0.2776 -
Distribution No. 12 - 0.2477 0.2477 -
Distribution No. 13 0.0244 0.2663 0.2907 -
Distribution No. 14 - 0.3684 0.3684 0.3174
Distribution No. 15 0.1271 0.2017 0.3288 0.3162
Distribution No. 16 0.0373 0.2080 0.2453 0.3549
Distribution No. 17 - 0.3491 0.3491 0.3766
Distribution No. 18 - 0.3624 0.3624 0.5074
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 2 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
15/11/19
Group 1 2.3078 - 2.3078
Group 2 0.9560 1.3518 2.3078
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Income Fund
83
Fund Manager’s Review
Investment Objective and PolicyThe fund aims to achieve an Income yield of 4-6% per annum over a typical market cycle (5-7 years).
Any income you may receive will vary depending on the share class of the fund into which you are invested and is not guaranteed.
The fund invests at least 70% into funds (including funds managed by Fidelity) which provide global exposure to a mixture of asset classes. The fund can also invest directly into transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes. The fund is actively managed without reference to a benchmark.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters: 20-100% income assets (such as bonds and cash) and 0-65% growth assets (such as equities, infrastructure securities and property securities). The fund’s asset allocation can be adjusted within the ranges in order to preserve capital or to take advantage of market opportunities.
Performance and Portfolio ActivityThe fund generated income in line with its objective and preserved capital during periods of market volatility. Moreover, it generated positive returns over the period. Investment grade bonds and equities were the largest contributors to returns, followed by high yield bonds and emerging market debt. Non-traditional assets such as infrastructure and loans also added value. In contrast, equity and fixed income market hedges weighed on returns, as did the allocation to a reinsurance strategy. We sold our position in Australian government bonds following their strong performance and reduced the exposure to Fidelity Funds - US High Yield. New positions were purchased in Fidelity Funds - European High Yield given its attractive valuations, and Fidelity Renaissance, which invests in high-quality credits. The allocation to Fidelity Funds - Emerging Market Local Currency Debt was also increased given its attractive valuations. We continue to hedge part of the fund’s equity market beta through short futures positions. This provides some protection to the portfolio against equity market volatility.
OutlookThe late-cycle environment and performance of markets continues to send mixed signals on the direction of markets. Our focus remains on balancing income with risk, but we are also allocating tactically to take advantage of opportunities arising from volatility and market dislocations.
Eugene Philalithis, Chris Forgan & George EfstathopoulosFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 3
A Income Shares 3
I Income Shares 3
Lovewell Blake FP Income Shares 4
W Accumulation Shares 3
W Income Shares 3
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• Liquidity is a measure of how easily an investment can be converted into cash. Under certain market conditions assets may be more difficult to sell.
Fidelity Multi Asset Income Fund
84
Comparative Performance Table
A Accumulation Shares A Income Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share* 167.73 169.17 163.46 109.17 114.75 115.50
Return before operating charges* 15.10 0.95 8.44 9.67 0.62 6.82
Operating charges (2.86) (2.39) (2.73) (1.82) (1.59) (1.90)
Return after operating charges* 12.24 (1.44) 5.71 7.85 (0.97) 4.92
Distributions (5.12) (4.72) (4.65) (4.72) (4.61) (5.67)
Retained distributions on accumulation shares 5.12 4.72 4.65 - - -
Closing net asset value per share 179.97 167.73 169.17 112.30 109.17 114.75
*after direct transaction costs of - 0.01 0.02 - 0.01 0.02
Performance
Return after charges 7.3% (0.9%) 3.5% 7.2% (0.9%) 4.3%
Other information
Closing net asset value (£'000) 18,099 14,056 17,301 3,219 3,495 3,207
Closing number of shares 10,056,769 8,380,247 10,226,921 2,866,175 3,201,703 2,794,800
Operating charges 1.64% 1.42% 1.64% 1.64% 1.42% 1.64%
Direct transaction costs 0% 0.01% 0.02% 0% 0.01% 0.02%
Prices (pence per share)
Highest share price 181.70 171.40 171.00 115.00 115.30 118.30
Lowest share price 162.20 163.50 158.20 105.40 109.00 111.50
I Income Shares W Income Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share* 102.98 107.18 106.93 104.42 108.93 108.83
Return before operating charges* 9.15 0.90 5.45 9.27 (0.24) 6.45
Operating charges (0.67) (0.67) (0.69) (0.95) (0.96) (0.97)
Return after operating charges* 8.48 0.23 4.76 8.32 (0.12) 5.48
Distributions (4.58) (4.43) (4.51) (4.52) (4.39) (5.38)
Retained distributions on accumulation shares - - - - - -
Closing net asset value per share 106.88 102.98 107.18 108.22 104.42 108.93
*after direct transaction costs of - 0.01 0.02 - 0.01 0.02
Performance
Return after charges 8.2% 0.2% 4.5% 8.0% (0.1%) 5.0%
Other information
Closing net asset value (£'000) 433,909 492,036 281,011 277,683 163,324 45,301
Closing number of shares 405,968,098 477,780,556 262,184,913 256,571,936 156,414,090 41,587,467
Operating charges 0.64% 0.33% 0.64% 0.89% 0.67% 0.89%
Direct transaction costs 0% 0.01% 0.02% 0% 0.01% 0.02%
Prices (pence per share)
Highest share price 109.20 107.90 110.10 110.60 109.60 112.00
Lowest share price 99.46 102.80 103.30 100.90 104.20 105.20
Fidelity Multi Asset Income Fund
85
Comparative Performance Table
W Accumulation Shares Lovewell Blake FP Income Shares
Change in net assets (pence per share) 2019 2019 2018
Opening net asset value per share* 106.19 99.73 100.00
Return before operating charges* 0.93 8.88 1.97
Operating charges (0.93) (0.81) (0.81)
Return after operating charges* 2.80 8.07 2.21
Distributions (2.80) (4.42) (2.48)
Retained distributions on accumulation shares 2.80 - -
Closing net asset value per share 106.19 103.38 99.73
*after direct transaction costs of - - 0.01
Performance
Return after charges 2.6% 8.1% 2.2%
Other information
Closing net asset value (£'000) 120,592 1,160 79
Closing number of shares 113,536,854 1,121,906 79,383
Operating charges 0.89% 0.79% 0.31%
Direct transaction costs 0% 0% 0.01%
Prices (pence per share)
Highest share price 107.10 105.70 103.10
Lowest share price 99.91 96.34 99.51
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Income Fund
86
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 34,359 (24,600)
Revenue 5 36,192 30,570
Expenses 6 (5,259) (4,847)
Interest payable and similar charges 8 (485) (525)
Net revenue/(expense) before taxation 30,448 25,198
Taxation 7 (36) (34)
Net revenue/(expense) after taxation 30,412 25,164
Total return before distributions 64,771 564
Distributions 8 (33,547) (28,559)
Change in net assets attributable to shareholders from investment activities 31,224 (27,995)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 813,198 620,501
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 130,537 272,351
Amounts payable on cancellation of shares (123,993) (54,984)
6,544 217,367
Change in net assets attributable to shareholders from investment activities (see above) 31,224 (27,995)
Retained distribution on accumulation shares 3,696 3,325
Closing net assets attributable to shareholders 854,662 813,198
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 828,089 774,917
Current assets:
Debtors 9 5,214 10,312
Cash equivalents 19,220 28,792
Cash and bank balances 10 14,023 10,484
Total other assets 38,457 49,588
Total assets 866,546 824,505
Liabilities:
Investment liabilities (3,931) (2,947)
Creditors
Distribution payable (6,553) (7,242)
Other creditors 11 (1,400) (1,118)
Total other liabilities (7,953) (8,360)
Total liabilities (11,884) (11,307)
Net assets attributable to shareholders 854,662 813,198
Fidelity Multi Asset Income Fund
87
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 30,483 (18,341)
Gains/(losses) on derivative contracts+ (1,143) 1,263
Gains/(losses) on forward currency contracts+ 3,663 (9,013)
Other currency gains/(losses) 2 50
Transaction charges (79) (66)
Broker fee rebates - 3
ACD fee rebate/waiver to capital 1,271 1,490
Management fee rebate to capital 160 14
Compensation payments 2 -
Net capital gains/(losses) 34,359 (24,600)
+ These comprise:
Realised gains/(losses)++ (5,219) (1,924)
Unrealised gains/(losses) 38,222 (24,167)
Total 33,003 (26,091)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 7,118 5,316
Unfranked UK dividend distributions 1,572 1,461
Overseas dividend distributions 4,603 4,985
Interest distributions 18,632 15,486
Derivative revenue 144 26
ACD fee rebate/waiver to income 3,758 3,064
UK dividends - 36
UK property income distributions 66 138
Bank interest 299 57
Taxable interest - 1
Total revenue 36,192 30,570
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 4,364 4,049
Registrar fees 360 335
Service charges 410 352
5,134 4,736Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 64 57
64 57
Fidelity Multi Asset Income Fund
88
Notes to the Financial Statements
Other expenses:
Audit fee 11 11
Other operating expenses 50 43
61 54
Total expenses 5,259 4,847
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 13 28
Overseas taxation 23 6
Total current taxation 36 34
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 30,448 25,198
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 6,090 5,040Effects of:
ACD fee waiver to capital 286 301
Interest distributions (4,027) (3,272)
Overseas tax expensed (5) (1)
Overseas taxation 23 6
Revenue not included for tax purposes (2,344) (2,068)
UK property income distributions 13 28
Current tax charge/(credit) 36 34
Open ended investment companies are exempt from UK tax on capital gains.
The fund is an interest distributing fund under Corporation Tax Act 2009 and as interest distributions are deductible when calculating the liability, the corporation tax charge will usually be reduced to nil, except where there are expenses which are not deductible.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final 515 396
A Income Shares
Final 18 22
Interim 123 124
Gross paying A Income Shares*
Interim - 2
I Income Shares
Final 2,407 3,118
Interim 17,101 13,418
Y Accumulation Shares
Final - 2,929
Y Income Shares
Final - 322
Interim 560 1,773
Gross paying Y Income Shares
Interim - 123
W Income Shares
Final 1,512 1,018
Interim 8,384 4,872
Gross paying N Income Shares
Interim - 834
Fidelity Multi Asset Income Fund
89
Notes to the Financial Statements
W Accumulation Shares
Final 3,181 -
Lovewell Blake FP Income Shares
Final 6 1
Interim 25 -
33,832 28,952
Add: Revenue deducted on cancellation of shares 476 549
Deduct: Revenue received on issue of shares (761) (942)
Net distributions for the year 33,547 28,559
Interest/other
Interest 4 1
Derivative expense 310 489
Contract for difference finance costs 171 35
485 525
Total finance costs 34,032 29,084
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return 30,412 25,164
Add back (revenue)/expenses transferred to capital:
Service charges 353 294
Investment management fees 3,600 3,101
Equalisation on conversions (818) -
33,547 28,559
Details of the distributions per share are set out in the Distribution Statement.
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 1,772 337
Sales awaiting settlement 9 7,015
Accrued revenue 1,357 1,209
Management fee rebate recoverable 14 14
ACD fee rebate/waiver recoverable 1,277 1,252
UK income tax recoverable 748 485
UK corporation tax recoverable 37 -
Total debtors 5,214 10,312
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 2,205 183
Cash and bank balances 11,818 10,301
Total cash and bank balances 14,023 10,484
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares - 438
Purchases awaiting settlement 891 176
Accrued expenses 509 476
UK corporation tax payable - 28
Total other creditors 1,400 1,118
Fidelity Multi Asset Income Fund
90
Notes to the Financial Statements
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Australian Dollar 67 - - 67
Chinese Yuan Renminbi 373 - - 373
Euro 58,659 - - 58,659
Hong Kong Dollar 183 - - 183
Hungarian Forint - 1 - 1
Japanese Yen (3,190) - - (3,190)
Swiss Franc 466 - - 466
UK Pound 567,220 14,022 (2,739) 578,503
US Dollar 219,600 - - 219,600
Total 843,378 14,023 (2,739) 854,662
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar 40 - - 40
Czech Koruna 25 - - 25
Euro 38,073 - 55 38,128
Hong Kong Dollar (39) - - (39)
Hungarian Forint 8 - - 8
Japanese Yen (161) - - (161)
Korean Won (19) - - (19)
Swiss Franc 172 - - 172
Taiwan Dollar (3) - - (3)
Thai Baht 1 - - 1
Turkish Lira (29) - - (29)
UK Pound 536,645 10,472 1,897 549,014
US Dollar 226,049 12 - 226,061
Total 800,762 10,484 1,952 813,198
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Australian Dollar - - 75 75
Swiss Franc - - 466 466
Chinese Yuan Renminbi - - 406 406
Euro 49,837 - 8,995 58,832
UK Pound 307,852 - 278,614 586,466
Hong Kong Dollar - - 190 190
Hungarian Forint 1 - - 1
Japanese Yen - - 138 138
US Dollar 201,434 - 18,538 219,972
Total 559,124 - 307,422 866,546
Fidelity Multi Asset Income Fund
91
Notes to the Financial Statements
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar - - 50 50
Czech Koruna - - 25 25
Euro 31,711 - 6,576 38,287
Hungarian Forint - - 17 17
Japanese Yen - - 97 97
Swiss Franc - - 174 174
Thai Baht - - 10 10
Turkish Lira - - 126 126
UK Pound 309,213 - 248,161 557,374
US Dollar 195,354 - 32,991 228,345
Total 536,278 - 288,227 824,505
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
Australian Dollar - - 8 8
Chinese Yuan Renminbi - - 33 33
Euro - - 173 173
UK Pound - - 862,625 862,625
Hong Kong Dollar - - 7 7
Japanese Yen - - 3,328 3,328
US Dollar - - 372 372
Total - - 866,546 866,546
31/10/18 £'000 £'000 £'000 £'000
Australian Dollar - - 10 10
Euro - - 159 159
Hong Kong Dollar - - 39 39
Hungarian Forint - - 9 9
Japanese Yen - - 258 258
Korean Won - - 20 20
Swiss Franc - - 1 1
Taiwan Dollar - - 4 4
Thai Baht - - 9 9
Turkish Lira - - 155 155
UK Pound - - 821,557 821,557
US Dollar - - 2,284 2,284
Total - - 824,505 824,505
^ Includes £854,662,000 in respect of the fund's liability to redeem all shares (2018: £813,198,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.19% rise or fall in the fund's market value (2018: 0.17%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 3.56% fall or rise in the fund's market value (2018: 3.73%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
At the year end the fund holds no derivatives that could impact it significantly (2018: same).
Equity derivatives
At the year end the fund holds no equity derivatives (2018: same).
Fidelity Multi Asset Income Fund
92
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 1,651 - - - -
Mutual Fund 267,362 - - - -
Corporate actions 313 - - - -
Derivative - 5 - - -
Total 269,326 5 -
Total including transaction costs 269,331
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 26,658 17 0.06 - -
Mutual Fund 232,198 2 - - -
Corporate actions 1,540 - - - -
Derivative - 6 - - -
Total 260,396 25 -
Total including transaction costs 260,371
Total as a percentage of average net assets*
0.00 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 30,652 12 0.04 - -
Mutual Fund 423,628 9 - 1 -
Corporate actions 797 - - - -
Derivative - 5 - - -
Total 455,077 26 1
Total including transaction costs 455,104
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 24,640 13 0.05 - -
Mutual Fund 233,373 16 0.01 - -
Corporate actions 1,183 - - - -
Derivative - 5 - - -
Total 259,196 34 -
Total including transaction costs 259,162
Total as a percentage of average net assets
0.01 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.09%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 103,063 (520) 66,177 (102)
Level 2: Observable market data 744,246 (3,411) 737,532 (2,845)
Level 3: Unobservable data - - - -
847,309 (3,931) 803,709 (2,947)
Fidelity Multi Asset Income Fund
93
Notes to the Financial Statements
15 Shares in issue reconciliationShares in issue as
at 31/10/18 Issued shares Cancelled shares Conversion sharesShares in issue as
at 31/10/19
A Accumulation Shares 8,380,247 2,798,350 (1,046,932) (74,896) 10,056,769
A Income Shares 3,201,703 120,921 (263,876) (192,573) 2,866,175
I Income Shares 477,780,556 31,769,641 (103,582,099) - 405,968,098
Lovewell Blake FP Income Shares 79,383 1,055,234 (12,711) - 1,121,906
W Accumulation Shares - 27,502,988 (3,383,545) 89,417,411 113,536,854
W Income Shares 156,414,090 54,518,544 (3,041,944) 48,681,246 256,571,936
Y Accumulation Shares 69,795,931 1,823,435 (2,354,552) (69,264,814) -
Y Income Shares 45,717,728 1,575,149 (2,512,121) (44,780,756) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5 and amounts receivable at the year end are included within the ACD fee rebate/waiver recoverable in note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £11,788,000 (2018: £675,000) are included in Note 5 and amounts receivable at the year end of £615,000 (2018: £572,000) are included within accrued revenue in Note 9.During the year, the aggregate value of purchases and sales in Fidelity funds were £156,604,000 and £138,499,000 respectively (2018: £222,537,000 and £151,574,000).Amounts receivable at the year end in respect of investments sold of nil (2018: £6,908,000) are included within sales awaiting settlement in Note 9.Amounts due at the year end in respect of investments purchased of £519,000 (2018: £106,000) are included within purchases awaiting settlement in Note 11.
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America (7) - - - - - (7)
BBH (3,193) - - - - - (3,193)
CIBC (134) - - - - - (134)
Citibank 496 - - - - - 496
HSBC Global Markets (2) - - - - - (2)
JP Morgan 12,065 - - - - - 12,065
National Australia Bank 3,222 - - - - - 3,222
State Street 298 - - - - - 298
UBS - - (350) - - 2,205 1,855
Total 12,745 - (350) - - 2,205 14,600
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 43 - - - - - 43
BBH 31 - - - - - 31
CIBC (11) - - - - - (11)
Citibank 13 - - - - - 13
HSBC Global Markets (303) - - - - - (303)
JP Morgan 37 - - - - - 37
Morgan Stanley (39) - - - - - (39)
Northern Trust (1,888) - - - - - (1,888)
Royal Bank of Canada 1,208 - - - - - 1,208
Societe Generale (211) - - - - - (211)
State Street 29 - - - - - 29
UBS - - 1,164 - - 183 1,347
Total (1,091) - 1,164 - - 183 256
Fidelity Multi Asset Income Fund
94
Notes to the Financial Statements
18 Shareholders' funds
The fund has six share classes; W Income Shares, I Income Shares, Lovewell Blake FP Income Shares, A Income Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%A Income Shares : 1.25%I Income Shares : 0.50%W Income Shares : 0.50%W Accumulation Shares : 0.50%Lovewell Blake FP Income Shares : 0.55%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 179.97 183.59 2.01
A Income Shares 112.30 113.70 1.25
I Income Shares 106.88 108.50 1.52
W Income Shares 108.22 109.80 1.46
W Accumulation Shares 106.19 108.50 2.18
Lovewell Blake FP Income Shares 103.38 104.90 1.47
Fidelity Multi Asset Income Fund
95
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 13 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
15/12/19
Amount accumulated
15/12/18
Group 1 5.1168 - 5.1168 4.7238
Group 2 2.3928 2.7240 5.1168 4.7238
xxx xxx xxx xxx xxxA Income Shares - final distribution No. 144 in pence per shareGroup 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.6116 - 0.6116 0.6805
Group 2 0.2912 0.3204 0.6116 0.6805
xxx xxx xxx xxx xxxA Income Shares - interim distributions in pence per shareFor the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 133 0.2614 - 0.2614 0.2528
Distribution No. 134 0.2607 - 0.2607 0.2736
Distribution No. 135 0.3310 - 0.3310 0.3575
Distribution No. 136 0.3404 - 0.3404 0.3529
Distribution No. 137 0.3495 - 0.3495 0.3533
Distribution No. 138 0.4150 - 0.4150 0.3780
Distribution No. 139 0.4330 - 0.4330 0.3778
Distribution No. 140 0.4113 - 0.4113 0.3566
Distribution No. 141 0.4121 - 0.4121 0.3773
Distribution No. 142 0.4761 - 0.4761 0.3981
Distribution No. 143 0.4209 - 0.4209 0.4502Group 2
Distribution No. 133 - 0.2614 0.2614 0.2528
Distribution No. 134 - 0.2607 0.2607 0.2736
Distribution No. 135 - 0.3310 0.3310 0.3575
Distribution No. 136 - 0.3404 0.3404 0.3529
Distribution No. 137 - 0.3495 0.3495 0.3533
Distribution No. 138 - 0.4150 0.4150 0.3780
Distribution No. 139 - 0.4330 0.4330 0.3778
Distribution No. 140 - 0.4113 0.4113 0.3566
Distribution No. 141 - 0.4121 0.4121 0.3773
Distribution No. 142 - 0.4761 0.4761 0.3981
Distribution No. 143 0.0392 0.3817 0.4209 0.4502
xxx xxx xxx xxx xxx
Fidelity Multi Asset Income Fund
96
Distribution Statement
I Income Shares - final distribution No. 47 in pence per shareGroup 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.5928 - 0.5928 0.6527
Group 2 0.3974 0.1954 0.5928 0.6527
xxx xxx xxx xxx xxxI Income Shares - interim distributions in pence per shareFor the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 36 0.2525 - 0.2525 0.2440
Distribution No. 37 0.2560 - 0.2560 0.2649
Distribution No. 38 0.3200 - 0.3200 0.3419
Distribution No. 39 0.3300 - 0.3300 0.3400
Distribution No. 40 0.3400 - 0.3400 0.3400
Distribution No. 41 0.4000 - 0.4000 0.3620
Distribution No. 42 0.4200 - 0.4200 0.3642
Distribution No. 43 0.4000 - 0.4000 0.3438
Distribution No. 44 0.4000 - 0.4000 0.3634
Distribution No. 45 0.4600 - 0.4600 0.3813
Distribution No. 46 0.4100 - 0.4100 0.4343Group 2
Distribution No. 36 0.0281 0.2244 0.2525 0.2440
Distribution No. 37 0.0833 0.1727 0.2560 0.2649
Distribution No. 38 - 0.3200 0.3200 0.3419
Distribution No. 39 - 0.3300 0.3300 0.3400
Distribution No. 40 0.0421 0.2979 0.3400 0.3400
Distribution No. 41 0.1588 0.2412 0.4000 0.3620
Distribution No. 42 - 0.4200 0.4200 0.3642
Distribution No. 43 0.0737 0.3263 0.4000 0.3438
Distribution No. 44 0.0748 0.3252 0.4000 0.3634
Distribution No. 45 - 0.4600 0.4600 0.3813
Distribution No. 46 0.0959 0.3141 0.4100 0.4343
xxx xxx xxx xxx xxxW Income Shares - final distribution No. 73 in pence per share^Group 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.5892 - 0.5892 0.6507
Group 2 0.3120 0.2772 0.5892 0.6507
xxx xxx xxx xxx xxx
Fidelity Multi Asset Income Fund
97
Distribution Statement
W Income Shares - interim distributions in pence per share^For the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 62 0.2500 - 0.2500 0.2399
Distribution No. 63 0.2500 - 0.2500 0.2600
Distribution No. 64 0.3170 - 0.3170 0.3398
Distribution No. 65 0.3261 - 0.3261 0.3357
Distribution No. 66 0.3352 - 0.3352 0.3362
Distribution No. 67 0.3983 - 0.3983 0.3600
Distribution No. 68 0.4050 - 0.4050 0.3600
Distribution No. 69 0.3929 - 0.3929 0.3400
Distribution No. 70 0.3961 - 0.3961 0.3600
Distribution No. 71 0.4580 - 0.4580 0.3800
Distribution No. 72 0.4051 - 0.4051 0.4300Group 2
Distribution No. 62 - 0.2500 0.2500 0.2399
Distribution No. 63 0.0056 0.2444 0.2500 0.2600
Distribution No. 64 - 0.3170 0.3170 0.3398
Distribution No. 65 - 0.3261 0.3261 0.3357
Distribution No. 66 0.0055 0.3297 0.3352 0.3362
Distribution No. 67 0.0843 0.3140 0.3983 0.3600
Distribution No. 68 - 0.4050 0.4050 0.3600
Distribution No. 69 0.0596 0.3333 0.3929 0.3400
Distribution No. 70 0.0503 0.3458 0.3961 0.3600
Distribution No. 71 - 0.4580 0.4580 0.3800
Distribution No. 72 0.0536 0.3515 0.4051 0.4300
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 1 in pence per share^Group 1 - Shares purchased on or before 13 February 2019.Group 2 - Shares purchased from 14 February 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 2.8022 - 2.8022 -
Group 2 1.4518 1.3504 2.8022 -
xxx xxx xxx xxx xxxLovewell Blake FP Income Shares - final distribution No. 19 in pence per shareGroup 1 - Shares purchased on or before 30 September 2019.Group 2 - Shares purchased from 1 October 2019 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount distributed
15/12/19
Amount distributed
15/12/18
Group 1 0.5733 - 0.5733 0.6322
Group 2 0.3604 0.2129 0.5733 0.6322
xxx xxx xxx xxx xxx
Fidelity Multi Asset Income Fund
98
Distribution Statement
Lovewell Blake FP Income Shares - interim distributions in pence per shareFor the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 8 0.2445 - 0.2445 -
Distribution No. 9 0.2676 - 0.2676 -
Distribution No. 10 0.3107 - 0.3107 -
Distribution No. 11 0.3197 - 0.3197 -
Distribution No. 12 0.3293 - 0.3293 -
Distribution No. 13 0.3873 - 0.3873 0.0247
Distribution No. 14 0.3818 - 0.3818 0.3512
Distribution No. 15 0.3820 - 0.3820 0.3332
Distribution No. 16 0.3869 - 0.3869 0.3518
Distribution No. 17 0.4451 - 0.4451 0.3694
Distribution No. 18 0.3967 - 0.3967 0.4215Group 2
Distribution No. 8 - 0.2445 0.2445 -
Distribution No. 9 0.0728 0.1948 0.2676 -
Distribution No. 10 - 0.3107 0.3107 -
Distribution No. 11 - 0.3197 0.3197 -
Distribution No. 12 - 0.3293 0.3293 -
Distribution No. 13 - 0.3873 0.3873 0.0247
Distribution No. 14 - 0.3818 0.3818 0.3512
Distribution No. 15 - 0.3820 0.3820 0.3332
Distribution No. 16 0.0548 0.3321 0.3869 0.3518
Distribution No. 17 - 0.4451 0.4451 0.3694
Distribution No. 18 - 0.3967 0.3967 0.4215
xxx xxx xxx xxx xxxY Income Shares - interim distributions in pence per share^For the monthly distributing funds, shares purchased during the month prior to the ex-dividend date are classified as Group 2 shares.All other holdings are classified as Group 1 shares.
Gross revenueEqualisation
(Note 2)
Amount distributed 2018/2019
Amount distributed 2017/2018
Group 1
Distribution No. 82 0.2709 - 0.2709 0.2606
Distribution No. 83 0.2701 - 0.2701 0.2822
Distribution No. 84 0.3433 - 0.3433 0.3690
Distribution No. 85 0.3532 - 0.3532 0.3643Group 2
Distribution No. 82 - 0.2709 0.2709 0.2606
Distribution No. 83 - 0.2701 0.2701 0.2822
Distribution No. 84 - 0.3433 0.3433 0.3690
Distribution No. 85 - 0.3532 0.3532 0.3643
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Adventurous Fund
99
Fund Manager’s Review
Investment Objective and PolicyThis fund targets an average annual return of 6.5% after the deduction of ongoing fund charges, over a typical market cycle of 5-7 years. The return target assumes the deduction of the ongoing charges figure (OCF) on the W share class. There is no guarantee that the target will be achieved by the fund.
The fund has a large exposure to higher risk investments (such as global equities, global emerging market equities, global smaller companies and global property securities) meaning that it is likely to experience short-term price fluctuations and an investor may not get back the full amount invested.
The fund provides global exposure to a diversified range of assets by investing at least 70% into funds. The fund typically invests more than 65% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The exposure may be less than 65% depending on market conditions. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters in all market conditions: 60-100% equity, 0-40% debt instruments (which may include high yield and emerging market debt), 0-20% cash and 0-30% alternatives (such as infrastructure securities and Real Estate Investment Trusts).
Performance and Portfolio ActivityThe fund delivered positive returns, with all asset groups contributing to performance. Within growth assets, underlying UK, US and Europe ex-UK equity holdings added value. Within hedging assets, positions in gold and global aggregate bonds supported returns. We took some profits in iShares Physical Gold ETC and Investec Global Gold Fund. While we reduced our exposure to gold, we believe that the precious metal remains an attractive investment opportunity given the global trends towards protectionism. Within diversifying assets, we bought a position in PIMCO MLP & Energy Infrastructure Fund, which gives us exposure to the energy infrastructure sector. Within Europe ex-UK, we added a long position in the EURO Stoxx Banks index.
OutlookWe retain our cautious outlook as we continue to see an ever-widening spread between fundamentals and risk asset performance. Our focus remains on protecting investors’ capital, and we believe that defensive assets remain attractive.
Bill McQuaker & Ayesha AkbarFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 4
Lovewell Blake FP Accumulation Shares 4
W Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Open Adventurous Fund
100
Comparative Performance Table
A Accumulation Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2019 2018 2017
Opening net asset value per share* 108.95 133.92 136.81 122.76
Return before operating charges* 1.97 14.95 (1.17) 15.90
Operating charges (1.97) (1.56) (1.72) (1.85)
Return after operating charges* - 13.39 (2.89) 14.05
Distributions - - (1.01) (0.86)
Retained distributions on accumulation shares - - 1.01 0.86
Closing net asset value per share 108.95 147.31 133.92 136.81
*after direct transaction costs of 0.01 0.01 0.02 0.02
Performance
Return after charges 0% 10.0% (2.1%) 11.5%
Other information
Closing net asset value (£'000) 182,860 72,678 16,922 13,386
Closing number of shares 167,832,011 49,335,358 12,635,387 9,784,899
Operating charges 1.84% 1.09% 0.71% 1.42%
Direct transaction costs 0.01% 0.01% 0.02% 0.01%
Prices (pence per share)
Highest share price 112.50 151.80 142.70 137.30
Lowest share price 97.45 130.90 130.60 118.30
Lovewell Blake FP Accumulation Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 101.01 100.00
Return before operating charges* 11.28 2.09
Operating charges (0.97) (1.08)
Return after operating charges* 10.31 1.01
Distributions - (0.43)
Retained distributions on accumulation shares - 0.43
Closing net asset value per share 111.32 101.01
*after direct transaction costs of 0.01 0.02
Performance
Return after charges 10.2% 1.0%
Other information
Closing net asset value (£'000) 16,889 3,810
Closing number of shares 15,172,157 3,772,372
Operating charges 0.89% 0.30%
Direct transaction costs 0.01% 0.02%
Prices (pence per share)
Highest share price 114.70 107.60
Lowest share price 98.77 100.00
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Adventurous Fund
101
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 20,088 (648)
Revenue 5 723 263
Expenses 6 (2,411) (127)
Interest payable and similar charges 8 (404) (7)
Net revenue/(expense) before taxation (2,092) 129
Taxation 7 (17) (3)
Net revenue/(expense) after taxation (2,109) 126
Total return before distributions 17,979 (522)
Distributions 8 1 (126)
Change in net assets attributable to shareholders from investment activities 17,980 (648)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 22,030 14,323
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 25,878 9,391
Amounts payable on cancellation of shares (26,054) (1,186)
In specie creation of shares 232,593 -
232,417 8,205
Change in net assets attributable to shareholders from investment activities (see above) 17,980 (648)
Retained distribution on accumulation shares 8 - 150
Closing net assets attributable to shareholders 272,427 22,030
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 260,199 19,761
Current assets:
Debtors 9 947 391
Cash equivalents 8,620 1,872
Cash and bank balances 10 4,166 271
Total other assets 13,733 2,534
Total assets 273,932 22,295
Liabilities:
Investment liabilities (966) (32)
Creditors
Bank overdrafts (7) -
Other creditors 11 (532) (233)
Total other liabilities (539) (233)
Total liabilities (1,505) (265)
Net assets attributable to shareholders 272,427 22,030
Fidelity Multi Asset Open Adventurous Fund
102
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 20,498 (673)
Gains/(losses) on derivative contracts+ (1,142) 52
Gains/(losses) on forward currency contracts+ 687 (23)
Other currency gains/(losses) 48 1
Transaction charges (4) (5)
Management fee rebate to capital 1 -
Net capital gains/(losses) 20,088 (648)
+ These comprise:
Realised gains/(losses)++ 2,800 1,845
Unrealised gains/(losses) 17,243 (2,489)
Total 20,043 (644)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 5 91
Unfranked UK dividend distributions 9 -
Overseas dividend distributions 183 66
Interest distributions 43 31
Derivative revenue 29 32
Management fee rebate to income 22 8
ACD fee rebate/waiver to income 407 33
Bank interest 25 2
Total revenue 723 263
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 2,028 89
Registrar fees 192 17
Service charges 96 8
2,316 114Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 24 2
24 2Other expenses:
Audit fee 10 10
Other operating expenses 61 1
71 11
Total expenses 2,411 127
Fidelity Multi Asset Open Adventurous Fund
103
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
Overseas taxation 17 2
Prior year adjustment - 1
Total current taxation 17 3
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation (2,092) 129
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). (418) 26Effects of:
Increase/(decrease) in unutilised management expenses 457 6
Overseas tax expensed (1) -
Overseas taxation 17 2
Prior year adjustment - 1
Revenue not included for tax purposes (38) (32)
Current tax charge/(credit) 17 3
Open ended investment companies are exempt from UK tax on capital gains.
The fund has unrelieved excess management expenses resulting in a potential deferred tax asset of £516,000 (2018: £59,000). It is unlikely that the fund will generate sufficient taxable profits in the future to utilise these and therefore no deferred tax asset has been recognised.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares*
Final - 6
W Accumulation Shares
Final - 128
Lovewell Blake FP Accumulation Shares
Final - 16
- 150
Add: Revenue deducted on cancellation of shares - 4
Deduct: Revenue received on issue of shares (1) (28)
Net distributions for the year (1) 126
Interest/other
Short dividend payments 53 -
Derivative expense 338 -
Contract for difference finance costs 13 7
404 7
Total finance costs 403 133
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return (2,109) 126
Add back (revenue)/expenses transferred to capital:
Revenue shortfall transferred from capital 2,108 -
(1) 126
Details of the distributions per share are set out in the Distribution Statement.The W Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £128,000).The Lovewell Blake FP Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £16,000).The A Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: same).
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Adventurous Fund
104
Notes to the Financial Statements
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 532 372
Accrued revenue 7 -
Management fee rebate recoverable 3 3
ACD fee rebate/waiver recoverable 404 14
UK income tax recoverable 1 2
Total debtors 947 391
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 1,528 70
Cash and bank balances 2,638 201
Total cash and bank balances 4,166 271
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 244 -
Purchases awaiting settlement - 210
Accrued expenses 286 23
Amounts payable on closure of derivative contract 2 -
Total other creditors 532 233
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro 43,255 2 - 43,257
Japanese Yen 16,769 - - 16,769
UK Pound 117,954 4,164 408 122,526
US Dollar 89,875 (7) 7 89,875
Total 267,853 4,159 415 272,427
31/10/18 £'000 £'000 £'000 £'000
Euro 1,830 3 - 1,833
Indonesian Rupiah 1 - - 1
Japanese Yen 983 - - 983
Korean Won 10 34 - 44
UK Pound 11,830 234 202 12,266
US Dollar 6,947 - (44) 6,903
Total 21,601 271 158 22,030
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile
The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers. At the year end, there is no significant interest rate risk on the fund.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Fidelity Multi Asset Open Adventurous Fund
105
Notes to the Financial Statements
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.50% rise or fall in the fund's market value (2018: 0.59%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.16% fall or rise in the fund's market value (2018: 0.76%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
The fund invests into futures to gain exposure to the bond markets. A 1% change in interest rates would lead to a change representing 0.70% of the fund's market value.
Equity derivatives
The fund can use derivatives for investment purposes. At the year end, the fund holds no derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 18,885 3 0.01 - -
Mutual Fund 229,156 - - - -
Corporate actions 37 - - - -
Derivative - 7 - - -
Total 248,078 10 -
Total including transaction costs 248,088
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 18,570 10 0.06 - -
Mutual Fund 12,164 - - - -
Derivative - 6 - - -
Total 30,734 16 -
Total including transaction costs 30,718
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 1,874 1 0.04 - -
Mutual Fund 22,444 - - - -
Corporate actions 52 - - - -
Derivative - 1 - - -
Total 24,370 2 -
Total including transaction costs 24,372
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 1,860 - 0.03 - -
Mutual Fund 14,656 - - - -
Derivative - 1 - - -
Total 16,516 1 -
Total including transaction costs 16,515
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.00%).
Fidelity Multi Asset Open Adventurous Fund
106
Notes to the Financial Statements
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 6,888 (143) 1,604 (3)
Level 2: Observable market data 261,931 (823) 20,029 (29)
Level 3: Unobservable data - - - -
268,819 (966) 21,633 (32)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares - 1,585,463 (19,040,224) 185,286,772 167,832,011
Lovewell Blake FP Accumulation Shares 3,772,372 11,950,562 (550,777) - 15,172,157
W Accumulation Shares 12,635,387 6,003,745 (3,547,765) 34,243,991 49,335,358
Y Accumulation Shares 918,799 10,448 (27,609) (901,638) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £265,000 (2018: £12,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5 and amounts receivable at the year end are included within the ACD fee rebate/waiver recoverable in note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £13,000 (2018: £5,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £21,381,000 and nil respectively (2018: £1,896,000 and £3,521,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 101 - - - - - 101
BNP Paribas 26 - - - - - 26
HSBC Global Markets - 223 - - - 210 433
UBS - (823) 71 - - 918 166
Total 127 (600) 71 - - 1,128 726
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 2 - - - - - 2
CIBC 16 - - - - - 16
Deutsche Bank - (12) - - - - (12)
HSBC Global Markets - (1) - - - - (1)
JP Morgan 4 - - - - - 4
Northern Trust (3) - - - - - (3)
Royal Bank of Canada (11) - - - - - (11)
UBS - - 23 - - 70 93
Total 8 (13) 23 - - 70 88
Fidelity Multi Asset Open Adventurous Fund
107
Notes to the Financial Statements
18 Shareholders' funds
The fund has three share classes; Lovewell Blake FP Accumulation Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%W Accumulation Shares : 0.50%Lovewell Blake FP Accumulation Shares : 0.45%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 108.95 109.59 0.59
W Accumulation Shares 147.31 148.50 0.81
Lovewell Blake FP Accumulation Shares 111.32 112.20 0.79
Fidelity Multi Asset Open Adventurous Fund
108
Distribution Statement
for the year ended 31 October 2019Lovewell Blake FP Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.4272
Group 2 - - - 0.4272
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 7 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 1.0091
Group 2 - - - 1.0091
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Defensive Fund
109
Fund Manager’s Review
Investment Objective and PolicyThis fund targets an average annual return of 4% after the deduction of ongoing fund charges, over a typical market cycle of 5-7 years. The return target assumes the deduction of the ongoing charges figure (OCF) on the W share class. There is no guarantee that the target will be achieved by the fund.
The fund has a large exposure to lower risk investments (such as debt instruments including global government bonds, global corporate bonds and cash) with the aim of mitigating the risk of capital losses, however, an investor may not get back the full amount invested.
The fund provides global exposure to a diversified range of assets by investing at least 70% into funds. The fund typically invests more than 65% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The exposure may be less than 65% depending on market conditions. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters in all market conditions: 0-35% equity, 15-100% debt instruments (which may include high yield and emerging market debt), 0-30% cash and 0-30% alternatives (such as infrastructure securities and Real Estate Investment Trusts).
Performance and Portfolio ActivityThe fund delivered positive returns, with all asset groups contributing to performance. Within growth assets, underlying UK equity holdings added value, while positions in the US detracted from performance. Within hedging assets, holdings in global aggregate bonds and gold supported returns. We took some profits in iShares Physical Gold ETC and Investec Global Gold Fund. While we reduced our exposure to gold, we believe that the precious metal remains an attractive investment opportunity given the global trends towards protectionism. Within diversifying assets, we bought a position in PIMCO MLP & Energy Infrastructure Fund, which gives us exposure to the energy infrastructure sector. Within the US, we added a long position in the IXM Financial Select sector index.
OutlookWe retain our cautious outlook as we continue to see an ever-widening spread between fundamentals and risk asset performance. Our focus remains on protecting investors’ capital, and we believe that defensive assets remain attractive.
Bill McQuaker & Ayesha AkbarFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 3
Lovewell Blake FP Accumulation Shares 3
W Accumulation Shares 3
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Open Defensive Fund
110
Comparative Performance Table
A Accumulation Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2019 2018 2017
Opening net asset value per share* 106.70 120.02 122.12 118.70
Return before operating charges* 1.87 10.39 (0.71) 4.96
Operating charges (1.87) (1.29) (1.39) (1.54)
Return after operating charges* - 9.10 (2.10) 3.42
Distributions - - (1.49) (1.27)
Retained distributions on accumulation shares - - 1.49 1.27
Closing net asset value per share 106.70 129.12 120.02 122.12
*after direct transaction costs of 0.01 0.01 0.01 0.03
Performance
Return after charges 0% 7.6% (1.7%) 2.9%
Other information
Closing net asset value (£'000) 14,488 49,293 12,211 3,550
Closing number of shares 13,578,162 38,174,923 10,174,028 2,906,617
Operating charges 1.77% 1.02% 0.69% 1.27%
Direct transaction costs 0.01% 0.01% 0.01% 0.03%
Prices (pence per share)
Highest share price 108.20 130.90 124.10 123.40
Lowest share price 99.35 119.50 117.90 115.50
Lovewell Blake FP Accumulation Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 101.00 100.00
Return before operating charges* 8.71 1.97
Operating charges (0.88) (0.97)
Return after operating charges* 7.83 1.00
Distributions (0.01) (0.67)
Retained distributions on accumulation shares 0.01 0.67
Closing net asset value per share 108.83 101.00
*after direct transaction costs of 0.01 0.01
Performance
Return after charges 7.8% 1.0%
Other information
Closing net asset value (£'000) 787 9
Closing number of shares 723,270 8,529
Operating charges 0.82% 0.25%
Direct transaction costs 0.01% 0.01%
Prices (pence per share)
Highest share price 110.30 104.40
Lowest share price 100.60 99.99
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Defensive Fund
111
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 3,372 (381)
Revenue 5 294 271
Expenses 6 (402) (99)
Interest payable and similar charges 8 (43) (4)
Net revenue/(expense) before taxation (151) 168
Taxation 7 (4) (13)
Net revenue/(expense) after taxation (155) 155
Total return before distributions 3,217 (226)
Distributions 8 - (155)
Change in net assets attributable to shareholders from investment activities 3,217 (381)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 13,582 11,214
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 9,339 5,169
Amounts payable on cancellation of shares (6,643) (2,586)
In specie creation of shares 45,073 -
47,769 2,583
Change in net assets attributable to shareholders from investment activities (see above) 3,217 (381)
Retained distribution on accumulation shares 8 - 166
Closing net assets attributable to shareholders 64,568 13,582
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 54,215 12,326
Current assets:
Debtors 9 103 46
Cash equivalents 9,849 1,072
Cash and bank balances 10 928 214
Total other assets 10,880 1,332
Total assets 65,095 13,658
Liabilities:
Investment liabilities (226) (45)
Creditors
Bank overdrafts (2) -
Other creditors 11 (299) (31)
Total other liabilities (301) (31)
Total liabilities (527) (76)
Net assets attributable to shareholders 64,568 13,582
Fidelity Multi Asset Open Defensive Fund
112
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 3,571 (423)
Gains/(losses) on derivative contracts+ (232) 79
Gains/(losses) on forward currency contracts+ 33 (42)
Other currency gains/(losses) 3 10
Transaction charges (5) (5)
Management fee rebate to capital 2 -
Net capital gains/(losses) 3,372 (381)
+ These comprise:
Realised gains/(losses)++ 419 353
Unrealised gains/(losses) 2,953 (739)
Total 3,372 (386)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions - 34
Overseas dividend distributions 60 68
Interest distributions 97 115
Derivative revenue 8 24
Management fee rebate to income 3 2
ACD fee rebate/waiver to income 92 25
Bank interest 34 3
Total revenue 294 271
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 294 67
Registrar fees 45 13
Service charges 22 6
361 86Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 5 2
5 2Other expenses:
Audit fee 10 10
Other operating expenses 26 1
36 11
Total expenses 402 99
Fidelity Multi Asset Open Defensive Fund
113
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax - 13
Overseas taxation 4 1
Double taxation relief - (1)
Total current taxation 4 13
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation (151) 168
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). (30) 34Effects of:
Double taxation relief - (1)
Increase/(decrease) in unutilised management expenses 42 -
Overseas taxation 4 1
Interest distributions (12) (21)
Current tax charge/(credit) 4 13
Open ended investment companies are exempt from UK tax on capital gains.
The fund is an interest distributing fund under Corporation Tax Act 2009 and as interest distributions are deductible when calculating the liability, the corporation tax charge will usually be reduced to nil, except where there are expenses which are not deductible.
The fund has been invested in interest bearing assets of more than 60% for the entire financial year and therefore qualifies to make a gross interest distribution on all share classes (2018: the fund made a dividend distribution on all share classes).
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares*
Final - 14
W Accumulation Shares
Final - 152
Lovewell Blake FP Accumulation Shares
Final - -
- 166
Add: Revenue deducted on cancellation of shares - 15
Deduct: Revenue received on issue of shares - (26)
Net distributions for the year - 155
Interest/other
Short dividend payments 9 -
Derivative expense 31 -
Contract for difference finance costs 3 4
43 4
Total finance costs 43 159
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return (155) 155
Add back (revenue)/expenses transferred to capital:
Revenue shortfall transferred from capital 155 -
- 155
Details of the distributions per share are set out in the Distribution Statement.The Y Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £14,000).The W Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £152,000).The A Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: same).
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Defensive Fund
114
Notes to the Financial Statements
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 9 36
Accrued revenue 2 -
Management fee rebate recoverable 1 1
ACD fee rebate/waiver recoverable 91 9
Total debtors 103 46
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 404 59
Cash and bank balances 524 155
Total cash and bank balances 928 214
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 240 1
Accrued expenses 59 18
UK corporation tax payable - 12
Total other creditors 299 31
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro 4,459 1 - 4,460
Japanese Yen 920 - - 920
UK Pound 50,772 927 (200) 51,499
US Dollar 7,687 - 2 7,689
Total 63,838 928 (198) 64,568
31/10/18 £'000 £'000 £'000 £'000
Euro 729 2 - 731
Indonesian Rupiah 1 - - 1
Japanese Yen 185 - - 185
Korean Won 10 34 - 44
UK Pound 10,211 173 15 10,399
US Dollar 2,217 5 - 2,222
Total 13,353 214 15 13,582
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Fidelity Multi Asset Open Defensive Fund
115
Notes to the Financial Statements
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Euro 2,116 - 2,357 4,473
Japanese Yen - - 920 920
UK Pound 27,442 - 24,358 51,800
US Dollar - - 7,902 7,902
Total 29,558 - 35,537 65,095
31/10/18 £'000 £'000 £'000 £'000
Euro 166 - 572 738
Indonesian Rupiah - - 1 1
Japanese Yen - - 185 185
Korean Won 34 - 10 44
UK Pound 7,825 - 2,604 10,429
US Dollar 239 - 2,022 2,261
Total 8,264 - 5,394 13,658
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
Euro - - 13 13
UK Pound - - 64,869 64,869
US Dollar - - 213 213
Total - - 65,095 65,095
31/10/18 £'000 £'000 £'000 £'000
Euro - - 7 7
UK Pound - - 13,612 13,612
US Dollar - - 39 39
Total - - 13,658 13,658
^ Includes £64,568,000 in respect of the fund's liability to redeem all shares (2018: £13,582,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.22% rise or fall in the fund's market value (2018: 0.65%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 1.74% fall or rise in the fund's market value (2018: 2.49%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
The fund invests into futures to gain exposure to the bond markets. A 1% change in interest rates would lead to a change representing 0.53% of the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
Fidelity Multi Asset Open Defensive Fund
116
Notes to the Financial Statements
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 4,122 1 0.02 - -
Mutual Fund 40,249 - - - -
Corporate actions 28 - - - -
Derivative - 1 - - -
Total 44,399 2 -
Total including transaction costs 44,401
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 4,103 2 0.06 - -
Mutual Fund 2,565 - - - -
Derivative - 1 - - -
Total 6,668 3 -
Total including transaction costs 6,665
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 828 - 0.05 - -
Mutual Fund 14,342 - - - -
Corporate actions 115 - - - -
Derivative - 1 - - -
Total 15,285 1 -
Total including transaction costs 15,286
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 446 - 0.05 - -
Mutual Fund 11,756 - - - -
Corporate actions 90 - - - -
Derivative - 1 - - -
Total 12,292 1 -
Total including transaction costs 12,291
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.02%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 2,342 (68) 956 (1)
Level 2: Observable market data 61,722 (158) 12,442 (44)
Level 3: Unobservable data - - - -
64,064 (226) 13,398 (45)
Fidelity Multi Asset Open Defensive Fund
117
Notes to the Financial Statements
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares - 14,803,155 (1,224,993) - 13,578,162
Lovewell Blake FP Accumulation Shares 8,529 721,621 (6,880) - 723,270
W Accumulation Shares 10,174,028 31,123,798 (4,214,652) 1,091,749 38,174,923
Y Accumulation Shares 1,126,902 22,054 (63,953) (1,085,003) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £45,000 (2018: £8,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £8,000 (2018: £13,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £1,398,000 and nil respectively (2018: £1,284,000 and £3,690,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 24 - - - - - 24
BNP Paribas 13 - - - - - 13
HSBC Global Markets - 52 - - - - 52
UBS - (158) (15) - - 404 231
Total 37 (106) (15) - - 404 320
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 2 - - - - - 2
CIBC 10 - - - - - 10
Deutsche Bank - (10) (1) - - - (11)
HSBC Global Markets - 1 - - - - 1
JP Morgan 3 - - - - - 3
Northern Trust (6) - - - - - (6)
Royal Bank of Canada (28) - - - - - (28)
UBS - - 33 - - 59 92
Total (19) (9) 32 - - 59 63
18 Shareholders' funds
The fund has three share classes; Lovewell Blake FP Accumulation Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%W Accumulation Shares : 0.50%Lovewell Blake FP Accumulation Shares : 0.45%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 106.70 107.40 0.66
W Accumulation Shares 129.12 130.19 0.83
Lovewell Blake FP Accumulation Shares 108.83 109.80 0.89
Fidelity Multi Asset Open Defensive Fund
118
Distribution Statement
for the year ended 31 October 2019Lovewell Blake FP Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.0133 - 0.0133 0.6741
Group 2 0.0074 0.0059 0.0133 0.6741
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 7 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Gross revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 1.4913
Group 2 - - - 1.4913
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Growth Fund
119
Fund Manager’s Review
Investment Objective and PolicyThis fund targets an average annual return of 5.5% after the deduction of ongoing fund charges, over a typical market cycle of 5-7 years. The return target assumes the deduction of the ongoing charges figure (OCF) on the W share class. There is no guarantee that the target will be achieved by the fund.
The fund has exposure to higher risk investments (such as global equities, global emerging market equities, global smaller companies and global property securities) meaning that there is a risk of short-term price fluctuations and an investor may not get back the full amount invested.
The fund provides global exposure to a diversified range of assets by investing at least 70% into funds. The fund typically invests more than 70% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The exposure may be less than 70% depending on market conditions. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters in all market conditions: 40-85% equity, 0-60% debt instruments (which may include high yield and emerging market debt), 0-20% cash and 0-30% alternatives (such as infrastructure securities and Real Estate Investment Trusts).
Performance and Portfolio ActivityThe fund delivered positive returns, with all asset groups contributing to performance. Within growth assets, underlying UK, Europe ex-UK and US equity holdings added value. Within hedging assets, positions in gold and global aggregate bonds supported returns. We took some profits in iShares Physical Gold ETC and Investec Global Gold Fund. While we reduced our exposure to gold, we believe that the precious metal remains an attractive investment opportunity given the global trends towards protectionism. Within diversifying assets, we bought a position in PIMCO MLP & Energy Infrastructure Fund, which gives us exposure to the energy infrastructure sector. Within hedging assets, we purchased a position in Assenagon Alpha Volatility Fund.
OutlookWe retain our cautious outlook as we continue to see an ever-widening spread between fundamentals and risk asset performance. Our focus remains on protecting investors’ capital, and we believe that defensive assets remain attractive.
Bill McQuaker & Ayesha AkbarFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 4
Lovewell Blake FP Accumulation Shares 4
W Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Open Growth Fund
120
Comparative Performance Table
A Accumulation Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share* 56.32 58.02 53.67 129.13 132.02 121.21
Return before operating charges* 6.10 (0.60) 5.47 13.99 (1.37) 12.40
Operating charges (1.14) (1.10) (1.12) (1.57) (1.52) (1.59)
Return after operating charges* 4.96 (1.70) 4.35 12.42 (2.89) 10.81
Distributions - (0.27) (0.30) - (1.61) (1.61)
Retained distributions on accumulation shares - 0.27 0.30 - 1.61 1.61
Closing net asset value per share 61.28 56.32 58.02 141.55 129.13 132.02
*after direct transaction costs of 0.01 0.01 0.02 0.01 0.01 0.02
Performance
Return after charges 8.8% (2.9%) 8.1% 9.6% (2.2%) 8.9%
Other information
Closing net asset value (£'000) 316,997 21,686 24,752 286,030 84,318 80,419
Closing number of shares 517,282,296 38,501,048 42,660,382 202,076,011 65,298,730 60,914,693
Operating charges 1.89% 1.90% 2.01% 1.14% 1.15% 1.26%
Direct transaction costs 0.01% 0.01% 0.02% 0.01% 0.01% 0.02%
Prices (pence per share)
Highest share price 62.93 60.07 58.29 145.10 137.50 132.60
Lowest share price 54.84 55.17 51.72 125.90 125.90 116.80
Lovewell Blake FP Accumulation Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 100.65 100.00
Return before operating charges* 10.90 1.62
Operating charges (1.01) (0.97)
Return after operating charges* 9.89 0.65
Distributions - (0.65)
Retained distributions on accumulation shares - 0.65
Closing net asset value per share 110.54 100.65
*after direct transaction costs of 0.01 0.01
Performance
Return after charges 9.8% 0.7%
Other information
Closing net asset value (£'000) 25,162 4,139
Closing number of shares 22,761,520 4,112,567
Operating charges 0.94% 0.95%
Direct transaction costs 0.01% 0.01%
Prices (pence per share)
Highest share price 113.20 107.10
Lowest share price 98.13 99.91
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Growth Fund
121
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 44,989 (4,338)
Revenue 5 2,505 2,388
Expenses 6 (5,314) (1,045)
Interest payable and similar charges 8 (542) (44)
Net revenue/(expense) before taxation (3,351) 1,299
Taxation 7 (81) (19)
Net revenue/(expense) after taxation (3,432) 1,280
Total return before distributions 41,557 (3,058)
Distributions 8 1 (1,279)
Change in net assets attributable to shareholders from investment activities 41,558 (4,337)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 125,540 122,183
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 52,733 17,553
Amounts payable on cancellation of shares (49,004) (11,196)
In specie creation of shares 457,362 -
461,091 6,357
Change in net assets attributable to shareholders from investment activities (see above) 41,558 (4,337)
Retained distribution on accumulation shares 8 - 1,337
Closing net assets attributable to shareholders 628,189 125,540
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 586,678 121,611
Current assets:
Debtors 9 1,408 671
Cash equivalents 33,797 2,127
Cash and bank balances 10 9,227 1,594
Total other assets 44,432 4,392
Total assets 631,110 126,003
Liabilities:
Investment liabilities (2,167) (287)
Creditors
Bank overdrafts (16) -
Other creditors 11 (738) (176)
Total other liabilities (754) (176)
Total liabilities (2,921) (463)
Net assets attributable to shareholders 628,189 125,540
Fidelity Multi Asset Open Growth Fund
122
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Compensation payments - 15
Gains/(losses) on non-derivative securities+ 45,388 (4,855)
Gains/(losses) on derivative contracts+ (1,810) 648
Gains/(losses) on forward currency contracts+ 1,356 (223)
Other currency gains/(losses) 59 80
Transaction charges (7) (7)
Broker fee rebates - 2
Management fee rebate to capital 3 2
Net capital gains/(losses) 44,989 (4,338)
+ These comprise:
Realised gains/(losses)++ 7,252 15,803
Unrealised gains/(losses) 37,682 (20,233)
Total 44,934 (4,430)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 10 799
Unfranked UK dividend distributions 72 2
Overseas dividend distributions 1,078 624
Interest distributions 402 511
Derivative revenue 82 154
Management fee rebate to income 42 55
ACD fee rebate/waiver to income 749 229
Bank interest 70 14
Total revenue 2,505 2,388
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 4,241 830
Registrar fees 472 122
Service charges 236 61
4,949 1,013Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 42 15
42 15Other expenses:
Audit fee 10 10
Other operating expenses 313 7
323 17
Total expenses 5,314 1,045
Fidelity Multi Asset Open Growth Fund
123
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
Overseas taxation 81 14
Prior year adjustment - 5
Total current taxation 81 19
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation (3,351) 1,299
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). (670) 260Effects of:
Increase/(decrease) in unutilised management expenses 891 27
Management fee rebate 1 -
Overseas tax expensed (4) (3)
Overseas taxation 81 14
Prior year adjustment - 5
Revenue not included for tax purposes (218) (284)
Current tax charge/(credit) 81 19
Open ended investment companies are exempt from UK tax on capital gains.
The fund has unrelieved excess management expenses resulting in a potential deferred tax asset of £1,335,000 (2018: £444,000). It is unlikely that the fund will generate sufficient taxable profits in the future to utilise these and therefore no deferred tax asset has been recognised.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final - 104
Y Accumulation Shares*
Final - 153
W Accumulation Shares
Final - 1,053
Lovewell Blake FP Accumulation Shares
Final - 27
- 1,337
Add: Revenue deducted on cancellation of shares - 58
Deduct: Revenue received on issue of shares (1) (116)
Net distributions for the year (1) 1,279
Interest/other
Short dividend payments 125 -
Interest - 1
Derivative expense 411 -
Contract for difference finance costs 6 43
542 44
Total finance costs 541 1,323
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return (3,432) 1,280
Add back (revenue)/expenses transferred to capital:
Revenue shortfall transferred from capital 3,431 -
Revenue b/f - (1)
(1) 1,279
Fidelity Multi Asset Open Growth Fund
124
Notes to the Financial Statements
Details of the distributions per share are set out in the Distribution Statement.The A Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £104,000).The Y Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £153,000).The W Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £1053,000).The Lovewell Blake FP Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £27,000).
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 651 557
Accrued revenue 16 1
Management fee rebate recoverable 6 23
ACD fee rebate/waiver recoverable 730 71
UK income tax recoverable 5 19
Total debtors 1,408 671
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 3,460 416
Cash and bank balances 5,767 1,178
Total cash and bank balances 9,227 1,594
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 158 93
Accrued expenses 578 83
Amounts payable on closure of derivative contract 2 -
Total other creditors 738 176
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro 92,443 - - 92,443
Japanese Yen 26,207 - - 26,207
UK Pound 342,848 9,227 637 352,712
US Dollar 156,810 - 17 156,827
Total 618,308 9,227 654 628,189
31/10/18 £'000 £'000 £'000 £'000
Euro 12,067 - - 12,067
Indonesian Rupiah 7 - - 7
Japanese Yen 5,483 - - 5,483
Korean Won 95 232 - 327
UK Pound 72,587 1,362 494 74,443
US Dollar 33,212 - 1 33,213
Total 123,451 1,594 495 125,540
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Fidelity Multi Asset Open Growth Fund
125
Notes to the Financial Statements
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.4% rise or fall in the fund's market value (2018: 0.59%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.22% fall or rise in the fund's market value (2018: 1.09%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
The fund invests into futures to gain exposure to the bond markets. A 1% change in interest rates would lead to a change representing 0.94% of the fund's market value (2018: At the year end the fund held no bond derivatives that could impact it significantly)..
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 46,037 10 0.02 - -
Mutual Fund 456,634 - - - -
Corporate actions 310 - - - -
Derivative - 12 - - -
Total 502,981 22 -
Total including transaction costs 503,003
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 43,939 24 0.05 - -
Mutual Fund 45,147 - - - -
Derivative - 8 - - -
Total 89,086 32 -
Total including transaction costs 89,054
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 5,592 2 0.04 - -
Mutual Fund 132,857 - - - -
Corporate actions 666 - - - -
Derivative - 7 - - -
Total 139,115 9 -
Total including transaction costs 139,124
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 4,736 2 0.04 - -
Mutual Fund 121,504 1 - - -
Corporate actions 597 - - - -
Derivative - 6 - - -
Total 126,837 9 -
Total including transaction costs 126,828
Total as a percentage of average net assets
0.02 %
0.00 %
Fidelity Multi Asset Open Growth Fund
126
Notes to the Financial Statements
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.01%).
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 21,531 (327) 6,913 (10)
Level 2: Observable market data 598,944 (1,840) 116,825 (277)
Level 3: Unobservable data - - - -
620,475 (2,167) 123,738 (287)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares 38,501,048 22,670,867 (55,821,136) 511,931,517 517,282,296
Lovewell Blake FP Accumulation Shares 4,112,567 19,694,304 (1,045,351) - 22,761,520
W Accumulation Shares 65,298,730 9,103,224 (9,863,542) 137,537,599 202,076,011
Y Accumulation Shares 26,061,168 488,735 (833,632) (25,716,271) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £544,000 (2018: £86,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £174,000 (2018: £130,000) are included in Note 5 and amounts receivable at the year end of nil (2018: £13,000) are included within accrued revenue in Note 9.During the year, the aggregate value of purchases and sales in Fidelity funds were £28,715,000 and nil respectively (2018: £6,112,000 and £27,041,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 233 - - - - - 233
BNP Paribas 71 - - - - - 71
HSBC Global Markets - 516 - - - 570 1,086
UBS - (1,841) 360 - - 1,705 224
Total 304 (1,325) 360 - - 2,275 1,614
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 18 - - - - - 18
CIBC 89 - - - - - 89
Deutsche Bank - (105) - - - 90 (15)
HSBC Global Markets - 5 - - - - 5
JP Morgan 22 - - - - - 22
Northern Trust (32) - - - - - (32)
Royal Bank of Canada (129) - - - - - (129)
UBS - - 211 - - 325 536
Total (32) (100) 211 - - 415 494
Fidelity Multi Asset Open Growth Fund
127
Notes to the Financial Statements
18 Shareholders' funds
The fund has three share classes; Lovewell Blake FP Accumulation Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%W Accumulation Shares : 0.50%Lovewell Blake FP Accumulation Shares : 0.45%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 61.28 61.67 0.64
W Accumulation Shares 141.55 142.69 0.81
Lovewell Blake FP Accumulation Shares 110.54 111.50 0.87
Fidelity Multi Asset Open Growth Fund
128
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 16 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.2706
Group 2 - - - 0.2706
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 7 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 1.6126
Group 2 - - - 1.6126
xxx xxx xxx xxx xxxLovewell Blake FP Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.6544
Group 2 - - - 0.6544
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Strategic Fund
129
Fund Manager’s Review
Investment Objective and PolicyThis fund targets an average annual return of 5% after the deduction of ongoing fund charges, over a typical market cycle of 5-7 years. The return target assumes the deduction of the ongoing charges figure (OCF) on the W share class. There is no guarantee that the target will be achieved by the fund.
The fund has exposure to both higher risk investments (such as global equities, global emerging market equities, global smaller companies and global property securities) and lower risk investments (such as debt instruments including global government bonds, global corporate bonds and cash) meaning that there is a moderate risk of capital losses and an investor may not get back the full amount invested.
The fund provides global exposure to a diversified range of assets by investing at least 70% into funds. The fund typically invests more than 65% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The exposure may be less than 65% depending on market conditions. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Asset allocation exposure of the fund will be actively managed within the following parameters: 20-60% equity, 5-80% debt instruments (which may include high yield and emerging market debt), 0-30% cash and 0-30% alternatives (such as infrastructure securities and Real Estate Investment Trusts).
Performance and Portfolio ActivityThe fund delivered positive returns, with all asset groups contributing to performance. Within growth assets, underlying UK and US equity holdings added value. Within hedging assets, positions in gold and global aggregate bonds supported returns. We took some profits in iShares Physical Gold ETC and Investec Global Gold Fund. While we reduced our exposure to gold, we believe that the precious metal remains an attractive investment opportunity given the global trends towards protectionism. Within diversifying assets, we bought a position in PIMCO MLP & Energy Infrastructure Fund, which gives us exposure to the energy infrastructure sector. Within the US, we added a long position in the IXM Financial Select sector index.
OutlookWe retain our cautious outlook as we continue to see an ever-widening spread between fundamentals and risk asset performance. Our focus remains on protecting investors’ capital, and we believe that defensive assets remain attractive.
Bill McQuaker & Ayesha AkbarFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 4
I Accumulation Shares 4
Lovewell Blake FP Accumulation Shares 4
W Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Multi Asset Open Strategic Fund
130
Comparative Performance Table
A Accumulation Shares I Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019
Opening net asset value per share* 143.04 146.49 137.97 100.00
Return before operating charges* 4.82 (0.75) 11.21 0.93
Operating charges (2.74) (2.70) (2.69) (0.93)
Return after operating charges* 2.08 (3.45) 8.52 -
Distributions - (0.88) (0.97) (0.04)
Retained distributions on accumulation shares - 0.88 0.97 0.04
Closing net asset value per share 154.82 143.04 146.49 104.66
*after direct transaction costs of 0.01 0.01 0.01 0.01
Performance
Return after charges 1.5% (2.4%) 6.2% 4.7%
Other information
Closing net asset value (£'000) 102,675 158 166 9,936
Closing number of shares 66,318,845 110,251 113,506 9,493,337
Operating charges 1.79% 1.85% 1.89% 0.89%
Direct transaction costs 0.01% 0.02% 0.02% 0.01%
Prices (pence per share)
Highest share price 157.30 149.60 147.10 106.10
Lowest share price 140.90 140.40 134.50 100.00
W Accumulation Shares Lovewell Blake FP Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018
Opening net asset value per share* 126.56 128.71 120.45 101.11 100.00
Return before operating charges* 12.86 (0.74) 9.71 10.28 2.03
Operating charges (1.41) (1.41) (1.45) (0.90) (0.92)
Return after operating charges* 11.45 (2.15) 8.26 9.38 1.11
Distributions - (1.69) (1.66) - (0.65)
Retained distributions on accumulation shares - 1.69 1.66 - 0.65
Closing net asset value per share 138.01 126.56 128.71 110.49 101.11
*after direct transaction costs of 0.01 0.01 0.01 0.01 0.01
Performance
Return after charges 9.1% (1.7%) 6.9% 9.3% 1.1%
Other information
Closing net asset value (£'000) 574,616 74,088 69,466 11,487 3,341
Closing number of shares 416,343,970 58,539,864 53,972,148 10,395,722 3,304,205
Operating charges 1.04% 1.10% 1.16% 0.84% 0.90%
Direct transaction costs 0.01% 0.02% 0.02% 0.01% 0.02%
Prices (pence per share)
Highest share price 140.00 132.10 129.20 112.00 105.50
Lowest share price 124.80 123.70 117.50 99.72 99.99
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Multi Asset Open Strategic Fund
131
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 43,316 (3,500)
Revenue 5 2,540 2,244
Expenses 6 (3,930) (902)
Interest payable and similar charges 8 (631) (39)
Net revenue/(expense) before taxation (2,021) 1,303
Taxation 7 (47) (45)
Net revenue/(expense) after taxation (2,068) 1,258
Total return before distributions 41,248 (2,242)
Distributions 8 (19) (1,566)
Change in net assets attributable to shareholders from investment activities 41,229 (3,808)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 116,052 103,529
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 84,466 28,519
Amounts payable on cancellation of shares (37,059) (13,306)
In specie creation of shares 494,022 -
541,429 15,213
Change in net assets attributable to shareholders from investment activities (see above) 41,229 (3,808)
Retained distribution on accumulation shares 8 4 1,118
Closing net assets attributable to shareholders 698,714 116,052
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 626,081 104,705
Current assets:
Debtors 9 2,545 397
Cash equivalents 62,748 10,204
Cash and bank balances 10 10,165 1,384
Total other assets 75,458 11,985
Total assets 701,539 116,690
Liabilities:
Investment liabilities (2,049) (349)
Creditors
Bank overdrafts (17) -
Distribution payable - (111)
Other creditors 11 (759) (178)
Total other liabilities (776) (289)
Total liabilities (2,825) (638)
Net assets attributable to shareholders 698,714 116,052
Fidelity Multi Asset Open Strategic Fund
132
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 44,429 (3,808)
Gains/(losses) on derivative contracts+ (1,761) 484
Gains/(losses) on forward currency contracts+ 540 (280)
Other currency gains/(losses) 66 90
Transaction charges (7) (7)
Broker fee rebates - 1
ACD fee rebate/waiver to capital 33 18
Management fee rebate to capital 16 2
Net capital gains/(losses) 43,316 (3,500)
+ These comprise:
Realised gains/(losses)++ 6,438 8,051
Unrealised gains/(losses) 36,770 (11,655)
Total 43,208 (3,604)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions (6) 474
Unfranked UK dividend distributions - 1
Overseas dividend distributions 730 625
Interest distributions 634 749
Derivative revenue 82 180
Management fee rebate to income 39 33
ACD fee rebate/waiver to income 939 176
Bank interest 122 6
Total revenue 2,540 2,244
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 2,927 709
Registrar fees 470 108
Service charges 234 55
3,631 872Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 41 13
41 13Other expenses:
Audit fee 10 10
Other operating expenses 248 7
258 17
Total expenses 3,930 902
Fidelity Multi Asset Open Strategic Fund
133
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax - 45
Overseas taxation 47 13
Double taxation relief - (13)
Total current taxation 47 45
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation (2,021) 1,303
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). (404) 261Effects of:
ACD fee waiver to capital 7 -
Double taxation relief - (13)
Increase/(decrease) in unutilised management expenses 542 -
Management fee rebate 3 4
Overseas tax expensed (3) -
Overseas taxation 47 13
Revenue not included for tax purposes (145) (220)
Current tax charge/(credit) 47 45
Open ended investment companies are exempt from UK tax on capital gains.
The fund has unrelieved excess management expenses resulting in a potential deferred tax asset of £542,000 (2018: -). It is unlikely that the fund will generate sufficient taxable profits in the future to utilise these and therefore no deferred tax asset has been recognised.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
A Accumulation Shares
Final - 1
A Income Shares*
Final - 52
Interim 9 222
I Accumulation Shares
Final 4 -
Y Income Shares
Final - 59
Interim 6 206
Y Accumulation Shares
Final - 109
W Accumulation Shares
Final - 987
Lovewell Blake FP Accumulation Shares
Final - 21
19 1,657
Add: Revenue deducted on cancellation of shares 1 70
Deduct: Revenue received on issue of shares (1) (161)
Net distributions for the year 19 1,566
Interest/other
Short dividend payments 98 -
Derivative expense 527 -
Contract for difference finance costs 6 39
631 39
Total finance costs 650 1,605
Fidelity Multi Asset Open Strategic Fund
134
Notes to the Financial Statements
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return (2,068) 1,258
Add back (revenue)/expenses transferred to capital:
Service charges 8 15
Revenue shortfall transferred from capital 1,907 -
Investment management fees 172 293
19 1,566
Details of the distributions per share are set out in the Distribution Statement.The A Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £1,000).The W Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £987,000).The Lovewell Blake FP Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £21,000).
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 1,552 312
Accrued revenue 18 1
Management fee rebate recoverable 14 14
ACD fee rebate/waiver recoverable 957 70
UK corporation tax recoverable 4 -
Total debtors 2,545 397
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 3,944 290
Cash and bank balances 6,221 1,094
Total cash and bank balances 10,165 1,384
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 275 60
Accrued expenses 481 90
Amounts payable on closure of derivative contract 3 -
UK corporation tax payable - 28
Total other creditors 759 178
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro 81,475 - - 81,475
Japanese Yen 17,623 - - 17,623
UK Pound 471,590 10,165 1,769 483,524
US Dollar 116,092 (17) 17 116,092
Total 686,780 10,148 1,786 698,714
Fidelity Multi Asset Open Strategic Fund
135
Notes to the Financial Statements
31/10/18 £'000 £'000 £'000 £'000
Euro 8,996 - - 8,996
Indonesian Rupiah 7 - - 7
Japanese Yen 2,495 - - 2,495
Korean Won 85 209 - 294
UK Pound 79,911 1,175 107 81,193
US Dollar 23,066 - 1 23,067
Total 114,560 1,384 108 116,052
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Euro - - 81,612 81,612
Japanese Yen - - 17,623 17,623
UK Pound 72,897 - 411,385 484,282
US Dollar 15 - 118,007 118,022
Total 72,912 - 628,627 701,539
31/10/18 £'000 £'000 £'000 £'000
Euro - - 9,051 9,051
Indonesian Rupiah - - 7 7
Japanese Yen - - 2,495 2,495
Korean Won 210 - 85 295
UK Pound 11,379 - 70,102 81,481
US Dollar - - 23,361 23,361
Total 11,589 - 105,101 116,690
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
Euro - - 137 137
UK Pound - - 699,472 699,472
US Dollar - - 1,930 1,930
Total - - 701,539 701,539
31/10/18 £'000 £'000 £'000 £'000
Euro - - 55 55
UK Pound - - 116,342 116,342
US Dollar - - 293 293
Total - - 116,690 116,690
^ Includes £698,714,000 in respect of the fund's liability to redeem all shares (2018: £116,052,000).The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers.
Interest rate risk profile
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.30% rise or fall in the fund's market value (2018: 0.60%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.94% fall or rise in the fund's market value (2018: 1.83%).
Fidelity Multi Asset Open Strategic Fund
136
Notes to the Financial Statements
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Bond futures
The fund invests into futures to gain exposure to the bond markets. A 1% change in interest rates would lead to a change representing 0.83% of the fund's market value (2018: At the year end the fund held no futures that could impact it significantly).
Equity derivatives
The fund can use derivatives for investment purposes. At the year end, the fund holds no derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 47,902 8 0.02 - -
Mutual Fund 496,255 - - - -
Corporate actions 208 - - - -
Derivative - 11 - - -
Total 544,365 19 -
Total including transaction costs 544,384
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 45,979 27 0.06 - -
Mutual Fund 27,994 - - - -
Derivative - 7 - - -
Total 73,973 34 -
Total including transaction costs 73,939
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 8,663 4 0.05 - -
Mutual Fund 114,467 - - - -
Corporate actions 451 - - - -
Derivative - 6 - - -
Total 123,581 10 -
Total including transaction costs 123,591
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 8,633 3 0.04 - -
Mutual Fund 98,619 1 - - -
Corporate actions 980 - - - -
Derivative - 5 - - -
Total 108,232 9 -
Total including transaction costs 108,223
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.01%).
Fidelity Multi Asset Open Strategic Fund
137
Notes to the Financial Statements
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 24,381 (363) 7,309 (6)
Level 2: Observable market data 664,448 (1,686) 107,600 (343)
Level 3: Unobservable data - - - -
688,829 (2,049) 114,909 (349)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares 110,251 9,969,232 (4,126,734) 60,366,096 66,318,845
A Income Shares 43,720,215 47,958,211 (10,402,371) (81,276,055) -
I Accumulation Shares - 9,493,631 (294) - 9,493,337
Lovewell Blake FP Accumulation Shares 3,304,205 7,378,359 (286,842) - 10,395,722
W Accumulation Shares 58,539,864 17,488,378 (18,742,208) 359,057,936 416,343,970
Y Accumulation Shares 7,793,445 2,092,673 (37,870) (9,848,248) -
Y Income Shares 46,885,772 12,096,092 (6,059,418) (52,922,446) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £445,000 (2018: £78,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Income received from Fidelity funds of £84,000 (2018: £167,000) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £22,719,000 and nil respectively (2018: £10,718,000 and £33,720,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 258 - - - - - 258
BNP Paribas 117 - - - - - 117
HSBC Global Markets - 568 - - - 620 1,188
UBS - (1,686) 361 - - 2,334 1,009
Total 375 (1,118) 361 - - 2,954 2,443
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 17 - - - - - 17
CIBC 84 - - - - - 84
Deutsche Bank - (81) - - - - (81)
HSBC Global Markets - 3 - - - - 3
JP Morgan 21 - - - - - 21
Northern Trust (50) - - - - - (50)
Royal Bank of Canada (199) - - - - - (199)
UBS - - 210 - - 290 500
Total (127) (78) 210 - - 290 295
Fidelity Multi Asset Open Strategic Fund
138
Notes to the Financial Statements
18 Shareholders' funds
The fund has four share classes; Lovewell Blake FP Accumulation Shares, I Accumulation Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%I Accumulation Shares : 0.50%W Accumulation Shares : 0.50%Lovewell Blake FP Accumulation Shares : 0.45%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 154.82 155.90 0.70
I Accumulation Shares 104.66 105.59 0.89
W Accumulation Shares 138.01 139.19 0.86
Lovewell Blake FP Accumulation Shares 110.49 111.50 0.91
Fidelity Multi Asset Open Strategic Fund
139
Distribution Statement
for the year ended 31 October 2019A Accumulation Shares - final distribution No. 8 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.8832
Group 2 - - - 0.8832
xxx xxx xxx xxx xxxY Income Shares - interim distribution in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased 1 November 2018 to 31 January 2019.
Net revenueEqualisation
(Note 2)
Amount distributed
31/03/19
Amount distributed
31/03/18
Group 1 0.0138 - 0.0138 0.1957
Group 2 0.0058 0.0080 0.0138 0.1957
xxx xxx xxx xxx xxxW Accumulation Shares - final distribution No. 7 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 1.6859
Group 2 - - - 1.6859
xxx xxx xxx xxx xxxLovewell Blake FP Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.6464
Group 2 - - - 0.6464
xxx xxx xxx xxx xxxA Income Shares - interim distribution in pence per share^Group 1 - Distribution No.61 Shares purchased on or before 31 October 2018Group 2 - Distribution No.61 Shares purchased from 1 November 2018 to 31 January 2019
Net revenueEqualisation
(Note 2)
Amount distributed
31/03/19
Amount distributed
31/03/18
Group 1 0.0190 - 0.0190 0.2111
Group 2 0.0061 0.0129 0.0190 0.2111
xxx xxx xxx xxx xxxI Accumulation Shares - final distribution No.1 in pence per share^Group 1 - Shares purchased on or before 15 May 2019.Group 2 - Shares purchased from 16 May 2019 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Group 1 0.0410 - 0.0410
Group 2 0.0391 0.0019 0.0410
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Open World Fund
140
Fund Manager’s Review
Investment Objective and PolicyThis fund targets an average annual return of 7% after the deduction of ongoing fund charges, over a typical market cycle of 5-7 years. The return target assumes the deduction of the ongoing charges figure (OCF) on the W share class. There is no guarantee that the target will be achieved by the fund.
The fund has a large exposure to equities meaning that it is likely to experience short-term price fluctuations in line with these markets and an investor may not get back the full amount invested.
The fund provides global exposure to a diversified range of assets by investing at least 70% into funds. The fund typically invests more than 70% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The exposure may be less than 70% depending on market conditions. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters in all market conditions: 80-100% equity, 0-20% debt instruments (which may include high yield and emerging market debt), 0-10% cash and 0-20% alternatives (such as infrastructure securities and Real Estate Investment Trusts).
Performance and Portfolio ActivityThe fund delivered positive returns, with all asset groups contributing to performance. Within growth assets, underlying US, Europe ex-UK and emerging market equity holdings added value. Within hedging assets, positions in gold supported returns. We took some profits in Investec Global Gold Fund and sold the holding in iShares Physical Gold ETC. While we reduced our exposure to gold, we believe that the precious metal remains an attractive investment opportunity given the global trends towards protectionism. Elsewhere, we added long positions in the IXM Financial Select sector index in the US and in the EURO Stoxx Bank index in Europe ex-UK.
OutlookWe retain our cautious outlook as we continue to see an ever-widening spread between fundamentals and risk asset performance. Our focus remains on protecting investors’ capital, and we believe that defensive assets remain attractive.
Bill McQuaker & Ayesha AkbarFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
A Accumulation Shares 5
Lovewell Blake FP Accumulation Shares 5
W Accumulation Shares 5
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
Fidelity Open World Fund
141
Comparative Performance Table
A Accumulation Shares W Accumulation Shares
Change in net assets (pence per share) 2019 2018 2017 2019 2018 2017
Opening net asset value per share* 169.61 170.87 151.13 159.06 159.19 140.10
Return before operating charges* 21.45 2.21 23.25 20.28 1.90 21.26
Operating charges (3.62) (3.47) (3.51) (2.24) (2.03) (2.17)
Return after operating charges* 17.83 (1.26) 19.74 18.04 (0.13) 19.09
Distributions - - - - (0.72) (0.57)
Retained distributions on accumulation shares - - - - 0.72 0.57
Closing net asset value per share 187.44 169.61 170.87 177.10 159.06 159.19
*after direct transaction costs of 0.01 0.03 0.01 0.01 0.03 0.01
Performance
Return after charges 10.5% (0.7%) 13.1% 11.3% (0.1%) 13.6%
Other information
Closing net asset value (£'000) 113,724 14,476 15,810 1,238,215 188,168 195,604
Closing number of shares 60,673,335 8,535,025 9,252,644 699,163,279 118,302,758 122,872,917
Operating charges 1.97% 2.00% 2.19% 1.22% 1.25% 1.45%
Direct transaction costs 0.01% 0.02% 0% 0.01% 0.02% 0%
Prices (pence per share)
Highest share price 197.20 184.00 171.40 185.90 172.40 159.60
Lowest share price 162.70 161.40 145.00 152.70 150.80 134.50
Lovewell Blake FP Accumulation Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share* 103.82 100.00
Return before operating charges* 13.17 4.94
Operating charges (1.16) (1.12)
Return after operating charges* 12.01 3.82
Distributions (0.07) (0.29)
Retained distributions on accumulation shares 0.07 0.29
Closing net asset value per share 115.83 103.82
*after direct transaction costs of 0.01 0.03
Performance
Return after charges 11.6% 3.8%
Other information
Closing net asset value (£'000) 2,072 179
Closing number of shares 1,788,795 172,506
Operating charges 1.02% 1.05%
Direct transaction costs 0.01% 0.02%
Prices (pence per share)
Highest share price 121.60 112.40
Lowest share price 99.72 99.89
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Open World Fund
142
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 115,229 (2,569)
Revenue 5 8,351 7,979
Expenses 6 (9,870) (5,689)
Interest payable and similar charges 8 (994) (259)
Net revenue/(expense) before taxation (2,513) 2,031
Taxation 7 (530) (120)
Net revenue/(expense) after taxation (3,043) 1,911
Total return before distributions 112,186 (658)
Distributions 8 (1) (1,958)
Change in net assets attributable to shareholders from investment activities 112,185 (2,616)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 628,017 677,770
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 62,496 3,646
Amounts payable on cancellation of shares (139,500) (52,657)
In specie creation of shares 690,812 -
613,808 (49,011)
Change in net assets attributable to shareholders from investment activities (see above) 112,185 (2,616)
Retained distribution on accumulation shares 8 1 1,874
Closing net assets attributable to shareholders 1,354,011 628,017
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 1,346,302 625,221
Current assets:
Debtors 9 1,330 669
Cash equivalents 6 8
Cash and bank balances 10 13,333 4,531
Total other assets 14,669 5,208
Total assets 1,360,971 630,429
Liabilities:
Investment liabilities (4,938) (1,101)
Creditors
Bank overdrafts (34) -
Other creditors 11 (1,988) (1,311)
Total other liabilities (2,022) (1,311)
Total liabilities (6,960) (2,412)
Net assets attributable to shareholders 1,354,011 628,017
Fidelity Open World Fund
143
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 113,326 (8,723)
Gains/(losses) on derivative contracts+ (1,815) 5,542
Gains/(losses) on forward currency contracts+ 3,592 12
Other currency gains/(losses) 130 567
Transaction charges (6) (6)
Management fee rebate to capital 2 39
Net capital gains/(losses) 115,229 (2,569)
+ These comprise:
Realised gains/(losses)++ 15,867 87,271
Unrealised gains/(losses) 99,236 (90,440)
Total 115,103 (3,169)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions (10) 2,050
Unfranked UK dividend distributions - 7
Overseas dividend distributions 6,067 3,595
Interest distributions 77 -
Derivative revenue 906 454
Management fee rebate to income 129 418
ACD fee rebate/waiver to income 1,138 1,427
Bank interest 44 28
Total revenue 8,351 7,979
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 6,557 4,583
Registrar fees 1,136 667
Service charges 568 333
8,261 5,583Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 71 55
71 55Other expenses:
Audit fee 10 10
Other operating expenses 1,528 41
1,538 51
Total expenses 9,870 5,689
Fidelity Open World Fund
144
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
Overseas taxation 530 85
Prior year adjustment - 35
Total current taxation 530 120
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation (2,513) 2,031
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). (503) 406Effects of:
ACD fee waiver to capital 1 8
Increase/(decrease) in unutilised management expenses 1,722 732
Overseas tax expensed - (17)
Overseas taxation 530 85
Prior year adjustment - 35
Revenue not included for tax purposes (1,220) (1,129)
Current tax charge/(credit) 530 120
Open ended investment companies are exempt from UK tax on capital gains.
The fund has unrelieved excess management expenses resulting in a potential deferred tax asset of £3,639,000 (2018: £1,917,000). It is unlikely that the fund will generate sufficient taxable profits in the future to utilise these and therefore no deferred tax asset has been recognised.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distributions take account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
Y Accumulation Shares*
Final - 1,021
W Accumulation Shares
Final - 852
Lovewell Blake FP Accumulation Shares
Final 1 1
1 1,874
Add: Revenue deducted on cancellation of shares - 91
Deduct: Revenue received on issue of shares - (7)
Net distributions for the year 1 1,958
Interest/other
Short dividend payments 311 -
Interest 15 5
Derivative expense 648 -
Contract for difference finance costs 20 254
994 259
Total finance costs 995 2,217
Reconciliation of Net revenue after taxation to Net distribution for the year:
Net revenue after taxation for the year, per the Statement of Total Return (3,043) 1,911
Add back (revenue)/expenses transferred to capital:
Revenue shortfall transferred from capital 3,044 47
1 1,958
Details of the distributions per share are set out in the Distribution Statement.The A Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: same).The Y Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £1021,000).The W Accumulation Shares have an excess of expenses over revenue for the current year and therefore there is no accumulation (2018: £852,000).
*Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.
Fidelity Open World Fund
145
Notes to the Financial Statements
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 142 1
Accrued revenue 35 6
Management fee rebate recoverable 15 136
ACD fee rebate/waiver recoverable 1,138 524
UK income tax recoverable - 2
Total debtors 1,330 669
10 Cash and bank balances
31/10/19 31/10/18£'000 £'000
Amounts held at futures clearing houses and brokers 8,197 1,115
Cash and bank balances 5,136 3,416
Total cash and bank balances 13,333 4,531
11 Other creditors
31/10/19 31/10/18£'000 £'000
Amounts payable for cancellation of shares 1,103 837
Accrued expenses 878 473
Amounts payable on closure of derivative contract 7 1
Total other creditors 1,988 1,311
12 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposure31/10/19 £'000 £'000 £'000 £'000Currency Investments^ Cash balances Debtors/(Creditors)
Euro 222,210 - - 222,210
Japanese Yen 112,461 - - 112,461
UK Pound 274,511 13,333 (691) 287,118
US Dollar 732,188 (34) 33 732,222
Total 1,341,370 13,299 (658) 1,354,011
31/10/18 £'000 £'000 £'000 £'000
Euro 49,432 - - 49,432
Indonesian Rupiah 37 - - 37
Japanese Yen 54,149 - - 54,149
Korean Won 533 992 - 1,525
UK Pound 178,498 3,536 (648) 181,386
US Dollar 341,479 3 6 341,488
Total 624,128 4,531 (642) 628,017
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile
The fund invests in equity, fixed interest funds, cash/money market funds and has bank balances and/or amounts held at futures clearing houses and brokers. At the year end, there is no significant interest rate risk on the fund.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Fidelity Open World Fund
146
Notes to the Financial Statements
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.78% rise or fall in the fund's market value (2018: 0.75%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Equity derivatives
At the year end the fund holds no equity derivatives that could impact it significantly (2018: same).
13 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 51,983 8 0.02 - -
Mutual Fund 746,801 - - - -
Corporate actions 981 - - - -
Derivative - 33 - - -
Total 799,765 41 -
Total including transaction costs 799,806
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 38,643 22 0.06 - -
Mutual Fund 151,980 - - - -
Derivative - 22 - - -
Total 190,623 44 -
Total including transaction costs 190,579
Total as a percentage of average net assets*
0.01 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 42,303 21 0.05 - -
Mutual Fund 667,260 - - - -
Corporate actions 2,047 - - - -
Derivative - 44 - - -
Total 711,610 65 -
Total including transaction costs 711,675
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 35,904 9 0.02 - -
Mutual Fund 710,330 - - - -
Corporate actions 2 - - - -
Derivative - 40 - - -
Total 746,236 49 -
Total including transaction costs 746,187
Total as a percentage of average net assets
0.02 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.01%).
Fidelity Open World Fund
147
Notes to the Financial Statements
14 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices 66,945 (774) 50,400 (54)
Level 2: Observable market data 1,279,363 (4,164) 574,829 (1,047)
Level 3: Unobservable data - - - -
1,346,308 (4,938) 625,229 (1,101)
15 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares Conversion shares
Shares in issue as at 31/10/19
A Accumulation Shares 8,535,025 7,740,267 (4,898,432) 49,296,475 60,673,335
Lovewell Blake FP Accumulation Shares 172,506 1,663,185 (46,896) - 1,788,795
W Accumulation Shares 118,302,758 25,109,538 (70,357,794) 626,108,777 699,163,279
Y Accumulation Shares 245,301,997 146,966 (4,397,851) (241,051,112) -
16 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 11.Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £824,000 (2018: £457,000) are included within accrued expenses in Note 11.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5.Amounts recoverable at the year end in respect of ACD fee rebate/waiver are included within ACD fee rebate/waiver recoverable in Note 9.Income received from Fidelity funds of £150,000 (2018: nil) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £79,916,000 and £5,179,000 respectively (2018: £142,536,000 and £178,149,000).
17 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
BBH 358 - - - - - 358
HSBC Global Markets - 1,114 - - - 1,110 2,224
UBS - (4,164) (542) - - 3,852 (854)
Total 358 (3,050) (542) - - 4,962 1,728
31/10/18
BrokerCurrency Contracts CFD Futures Swaps Options
Collateral - Cash Grand Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Bank of America 93 - - - - - 93
CIBC 459 - - - - - 459
Deutsche Bank - (475) - - - 30 (445)
HSBC Global Markets - 71 - - - - 71
JP Morgan 115 - - - - - 115
National Australia Bank 1 - - - - - 1
Royal Bank of Canada (344) - - - - - (344)
UBS - - 1,207 - - 1,085 2,292
Total 324 (404) 1,207 - - 1,115 2,242
Fidelity Open World Fund
148
Notes to the Financial Statements
18 Shareholders' funds
The fund has three share classes; Lovewell Blake FP Accumulation Shares, W Accumulation Shares and A Accumulation Shares. The annual management charge on each share class is as follows:A Accumulation Shares : 1.25%W Accumulation Shares : 0.50%Lovewell Blake FP Accumulation Shares : 0.45%The distributions per share class are given in the Distribution Statement. All classes have the same rights on winding up.
19 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
A Accumulation Shares 187.44 189.00 0.83
W Accumulation Shares 177.10 178.90 1.02
Lovewell Blake FP Accumulation Shares 115.83 117.09 1.09
Fidelity Open World Fund
149
Distribution Statement
for the year ended 31 October 2019W Accumulation Shares - final distribution No. 7 in pence per share^Group 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 - - - 0.7202
Group 2 - - - 0.7202
xxx xxx xxx xxx xxx^Share class closures, conversions, mergers and renames have been completed during the year. Please refer to the Changes to the Prospectus on page 3.Lovewell Blake FP Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.0691 - 0.0691 0.2937
Group 2 0.0688 0.0003 0.0691 0.2937
xxx xxx xxx xxx xxx
Fidelity Select 50 Balanced Fund
150
Fund Manager’s Review
Investment Objective and PolicyThe aim of the fund is to increase the value of your investment over a period of 5 years or more from global exposure to a diversified range of assets.
The fund invests at least 80% into a portfolio of funds from the Fidelity Select 50 list of funds (which may include funds managed by Fidelity).
The fund has exposure to a balance of both higher risk assets (like equities and non-investment grade debt instruments) and lower risk assets (such as investment grade debt instruments and cash). The Portfolio Manager will tactically alter the balance between these risk assets in accordance with the opportunities for producing returns over a typical market cycle of 5-7 years while balancing this with the aim of maintaining a moderate risk profile.
Asset allocation exposure of the fund will be actively managed subject to it remaining within the following parameters: 30-70% equity, 20-60% debt instruments (which may include investment grade and non-investment grade debt instruments (such as high yield and emerging market debt)) and alternatives and 0-20% cash. The fund is actively managed without reference to a benchmark.
The fund can also invest directly into other collective investment schemes, transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.
Performance and Portfolio ActivityThe fund delivered positive returns over the period, largely due to the fixed income segment. Specifically, the exposure to UK fixed income holdings contributed to performance. The allocation to commodities and UK equities also supported returns. Within equities, holdings in Schroders Tokyo Fund and Henderson Emerging Market Opportunities Fund were sold. Meanwhile, a position was purchased in Liontrust UK Growth Fund. Within the fixed income line-up, a holding was purchased in Jupiter Strategic Bond Fund.
OutlookWe believe that decelerating global growth could stabilise at subdued but near-trend levels going into next year. Consequently, caution is warranted in the current economic environment.
Ayesha Akbar & Sarah Jane CawthrayFund Managers
31 October 2019
Risk and Reward Indicator
XXX SRRI
PI Accumulation Shares 4
1 3 4 5 6 72
Lower risk Higher risk
Typically lower rewards Typically higher rewards
The risk category was calculated using historical volatility data, based upon the methods set by European Union rules. Volatility is influenced by changes in the stock market prices, currencies and interest rates which can be affected unpredictably by diverse factors including political and economic events.
• The risk category was calculated using historical performance data.
• The risk category may not be a reliable indication of the future risk profile of the fund, is not guaranteed and may change over time.
• The lowest category does not mean a "risk free" investment.
• The risk and reward profile is classified by the level of historical fluctuation of the Net Asset Values of the share class, and within this classification, categories 1-2 indicate a low level of historical fluctuations, 3-5 a medium level and 6-7 a high level.
• The value of your investment may fall as well as rise and you may get back less than you originally invested.
• The fund may invest in instruments denominated in currencies other than the fund base currency. Changes in currency exchange rates can therefore affect the value of your investment.
• Currency hedging may be used which aims to reduce the effect of such changes. However, the effects may not be completely eliminated to the degree expected.
• The use of derivatives may result in “leverage” by which we mean a level of exposure which could expose the fund to the potential of greater gains or losses than would otherwise be the case.
• There is a risk that the issuers of bonds may not be able to repay the money they have borrowed or make interest payments. While we seek to mitigate this, the fund may be exposed to the risk of financial loss if it invests into an instrument issued by an entity that subsequently defaults on its borrowings. Losses may also be realised if an entity that the fund is exposed to ceases to make interest payments over a period of time or indefinitely. Bond prices have an inverse relationship with interest rates such that when interest rates rise, bonds may fall in value. Rising interest rates may cause the value of your investment to fall.
Fidelity Select 50 Balanced Fund
151
Comparative Performance Table
PI Accumulation Shares
Change in net assets (pence per share) 2019 2018
Opening net asset value per share 99.34 100.00
Return before operating charges** 9.55 0.61
Operating charges (1.30) (1.27)
Return after operating charges* 8.25 (0.66)
Distributions (0.82) (0.63)
Retained distributions on accumulation shares 0.82 0.63
Closing net asset value per share 107.59 99.34
*after direct transaction costs of - -
Performance
Return after charges 8.3% (0.7%)
Other information
Closing net asset value (£'000) 86,272 46,115
Closing number of shares 80,183,721 46,420,063
Operating charges 1.25% 1.25%
Direct transaction costs 0% 0%
Prices (pence per share)
Highest share price 110.10 105.10
Lowest share price 97.08 97.99
*The fund launched on 21 February 2018.
Fidelity Select 50 Balanced Fund
152
Statement of Total Return
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Income
Net capital gains/(losses) 4 4,578 (1,217)
Revenue 5 1,080 305
Expenses 6 (461) (131)
Interest payable and similar charges 8 (1) (1)
Net revenue/(expense) before taxation 618 173
Taxation 7 (46) (16)
Net revenue/(expense) after taxation 572 157
Total return before distributions 5,150 (1,060)
Distributions 8 (572) (157)
Change in net assets attributable to shareholders from investment activities 4,578 (1,217)
Statement of Change in Net Assets Attributable to Shareholders
for the year ended 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Opening net assets attributable to shareholders 46,115 -
Movement due to sales and repurchases of shares
Amounts receivable on issue of shares 36,834 47,362
Amounts payable on cancellation of shares (1,916) (321)
34,918 47,041
Change in net assets attributable to shareholders from investment activities (see above) 4,578 (1,217)
Retained distribution on accumulation shares 8 661 291
Closing net assets attributable to shareholders 86,272 46,115
Balance Sheet
as at 31 October 201931/10/19 31/10/18
[BLANK] Note £'000 £'000 £'000 £'000
Assets
Investments 86,077 45,753
Current assets:
Debtors 9 255 876
Cash and bank balances 119 114
Total other assets 374 990
Total assets 86,451 46,743
Liabilities:Creditors
Other creditors 10 (179) (628)
Total other liabilities (179) (628)
Total liabilities (179) (628)
Net assets attributable to shareholders 86,272 46,115
Fidelity Select 50 Balanced Fund
153
Notes to the Financial Statements
1 Accounting policies
The fund’s financial statements have been prepared in accordance with the Company Accounting Polices and Risk Management sections.
2 Equalisation
Equalisation applies only to shares purchased during the distribution year (Group 2 shares). It is the average amount of revenue included in the purchase price of all Group 2 shares and is credited to the holders of these shares as a return of capital. Being capital it is not liable to income tax but must be deducted from the cost of shares for Capital Gains Tax purposes.
3 Contingent liabilities
At the year end there are no contingent liabilities or commitments (2018: nil).
4 Net capital gains/(losses)
31/10/19 31/10/18£'000 £'000
Gains/(losses) on non-derivative securities+ 4,505 (1,205)
Other currency gains/(losses) (5) 3
Transaction charges (6) (23)
ACD fee rebate/waiver to capital 13 3
Management fee rebate to capital 17 5
Gains/(losses) on forward currency contracts+ 54 -
Net capital gains/(losses) 4,578 (1,217)
+ These comprise:
Realised gains/(losses)++ 765 61
Unrealised gains/(losses) 3,794 (1,266)
Total 4,559 (1,205)
++ Where realised gains/(losses) include gains/losses arising in previous periods, a corresponding loss/gain is included in unrealised gains/(losses).
5 Revenue
31/10/19 31/10/18£'000 £'000
UK dividend distributions 336 76
Unfranked UK dividend distributions 54 8
Overseas dividend distributions 83 27
Interest distributions 493 115
Management fee rebate to income 12 3
ACD fee rebate/waiver to income 101 76
Bank interest 1 -
Total revenue 1,080 305
6 Expenses
31/10/19 31/10/18£'000 £'000
Payable to the ACD, associates of the ACD, and agents of either of them:
Investment management fees 338 91
Registrar fees 67 18
Service charges 34 9
439 118Payable to the Depositary, associates of the Depositary, and agents of either of them:
Depositary fees 8 2
8 2Other expenses:
Audit fee 10 10
Other operating expenses 4 1
14 11
Total expenses 461 131
Fidelity Select 50 Balanced Fund
154
Notes to the Financial Statements
7 Taxation
31/10/19 31/10/18£'000 £'000
a) Analysis of charge/(credit) for the year
UK corporation tax 46 16
Overseas taxation 7 1
Double taxation relief (7) (1)
Total current taxation 46 16
b) Factors affecting tax charge/(credit) for the year
Net revenue/(expense) before taxation 618 173
Net revenue/(expense) multiplied by the standard rate of corporation tax of 20% (2018: 20%). 124 35Effects of:
Double taxation relief (7) (1)
Management fee rebate 6 2
Overseas taxation 7 1
Revenue not included for tax purposes (84) (21)
Current tax charge/(credit) 46 16
Open ended investment companies are exempt from UK tax on capital gains.
8 Finance costs
31/10/19 31/10/18£'000 £'000
DistributionsThe distribution takes account of revenue received on the issue of shares and revenue deducted on cancellation of shares.
PI Accumulation Shares
Final 661 291
Add: Revenue deducted on cancellation of shares 5 1
Deduct: Revenue received on issue of shares (94) (135)
Net distributions for the year 572 157
Interest/other
Interest 1 1
Total finance costs 573 158
Details of the distribution per share is set out in the Distribution Statement.
9 Debtors
31/10/19 31/10/18£'000 £'000
Amounts receivable for issue of shares 196 796
Sales awaiting settlement - 1
Accrued revenue 25 13
Management fee rebate recoverable 3 3
ACD fee rebate/waiver recoverable 26 62
UK income tax recoverable 5 1
Total debtors 255 876
10 Other creditors
31/10/19 31/10/18£'000 £'000
Purchases awaiting settlement 76 577
Accrued expenses 64 37
UK corporation tax payable 39 14
Total other creditors 179 628
Fidelity Select 50 Balanced Fund
155
Notes to the Financial Statements
11 Financial instruments exposure
Currency exposure
A portion of the financial assets of the fund are denominated in currencies other than UK Pound, which is the fund's base currency, with the effect that the Balance Sheet and total return can be affected by currency movements.The currency exposure of the fund was:
Non-monetary exposures Monetary exposures Monetary exposures Total exposureCurrency Investments^ Cash balances Debtors/(Creditors)31/10/19 £'000 £'000 £'000 £'000
Euro 2,077 - - 2,077
UK Pound 82,293 119 76 82,488
US Dollar 1,707 - - 1,707
Total 86,077 119 76 86,272
31/10/18 £'000 £'000 £'000 £'000
UK Pound 44,385 114 248 44,747
US Dollar 1,368 - - 1,368
Total 45,753 114 248 46,115
^ includes cash equivalents where appropriate.The currency disclosure provided is based on the trading currency of the investments and foreign currency contracts. For further information on risk disclosures refer to the Risk management policies section.
Interest rate risk profile of financial assets and financial liabilities
The interest rate risk profile of the fund's financial assets was:
Currency Floating rate financial assets Fixed rate financial assetsFinancial assets on which no
interest is paid Total assets31/10/19 £'000 £'000 £'000 £'000
Euro - - 2,077 2,077
UK Pound 3,520 - 79,147 82,667
US Dollar - - 1,707 1,707
Total 3,520 - 82,931 86,451
31/10/18 £'000 £'000 £'000 £'000
UK Pound 21,561 - 23,814 45,375
US Dollar 1,368 - - 1,368
Total 22,929 - 23,814 46,743
The interest rate risk profile of the fund's financial liabilities was:
CurrencyFloating rate financial
liabilities Fixed rate financial liabilitiesFinancial liabilities on which
no interest is paid^ Total liabilities^31/10/19 £'000 £'000 £'000 £'000
UK Pound - - 86,451 86,451
Total - - 86,451 86,451
31/10/18 £'000 £'000 £'000 £'000
UK Pound - - 46,743 46,743
Total - - 46,743 46,743
^ Includes £86,272,000 in respect of the fund's liability to redeem all shares (2018: £46,115,000).
Interest rate risk profile
The only interest bearing financial instruments in the fund are its bank balances and/or amounts held at futures clearing houses and brokers.
Fair value of financial assets and financial liabilities
There is no material difference between the value of the financial assets and liabilities, as shown in the Balance Sheet, and their fair value.
Market value sensitivity analysis
Currency risk
A rise or fall of 1% in non UK Pound currencies is likely to result in a 0.11% rise or fall in the fund's market value (2018: 0.13%).
Interest rate risk
A rise or fall of 1% in global interest rates is likely to result in a 0.90% fall or rise in the fund's market value (2018: 0.61%).
Other price risk
Fluctuations in securities and underlying funds prices will directly be reflected in the fund's market value.
Fidelity Select 50 Balanced Fund
156
Notes to the Financial Statements
12 Portfolio transaction costs
31/10/19 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 103 - 0.06 - -
Mutual Fund 64,211 - - - -
Corporate actions 77 - - - -
Total 64,391 - -
Total including transaction costs 64,391
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Equity 693 - 0.05 - -
Mutual Fund 27,844 - - - -
Corporate actions 40 - - - -
Total 28,577 - -
Total including transaction costs 28,577
Total as a percentage of average net assets*
0.00 %
0.00 %
31/10/18 Purchases Commissions TaxesAnalysis of total purchases costs
£'000 £'000 % £'000 %
Equity 663 1 0.08 - -
Mutual Fund 49,160 - - - -
Total 49,823 1 -
Total including transaction costs 49,824
Sales Commissions TaxesAnalysis of total sales costs
£'000 £'000 % £'000 %
Mutual Fund 2,865 - - - -
Total 2,865 - -
Total including transaction costs 2,865
Total as a percentage of average net assets
0.00 %
0.00 %
*During the year dealing spread costs may be applicable to purchases and sales (the difference between bid and offer prices of all investments expressed as a percentage of the offer price value), which are not separately identifiable and do not form part of the analysis above. Dealing spread costs suffered by the fund vary considerably for the different asset/instrument types depending on a number of factors including transaction value and market sentiment. At the Balance Sheet date the average portfolio dealing spread was 0.00% (2018: 0.00%).
13 Basis of valuation
31/10/19 31/10/19 31/10/18 31/10/18£'000 £'000 £'000 £'000
Assets Liabilities Assets Liabilities
Level 1: Quoted prices - - 677 -
Level 2: Observable market data 86,077 - 45,076 -
Level 3: Unobservable data - - - -
86,077 - 45,753 -
14 Shares in issue reconciliation
Shares in issue as at 31/10/18 Issued shares Cancelled shares
Shares in issue as at 31/10/19
PI Accumulation Shares 46,420,063 35,584,210 (1,820,552) 80,183,721
Fidelity Select 50 Balanced Fund
157
Notes to the Financial Statements
15 Related parties
The ACD, FIL Investment Services (UK) Limited, is regarded as a related party under FRS 102 because it provides key management personnel services to the authorised fund.The ACD acts as principal on all transactions of shares in the fund. The aggregate monies received through issues and paid through cancellations are disclosed in the Statement of Change in Net Assets Attributable to Shareholders, and the amounts due to, and from, the ACD in respect of share transactions at the year end are disclosed in Notes 9 and 10.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to capital are included in note 4.Amounts rebated from the ACD in respect of the ACD fee rebate/waiver to income are included in note 5 and amounts receivable at the year end are included within the ACD fee rebate/waiver recoverable in note 9.The fund invests in other Fidelity funds, all transactions in respect of which are transacted with FIL Investment Services (UK) Limited.Amounts due at the year end in respect of investments purchased of nil (2018: £184,000) are included within purchases awaiting settlement in Note 10.Income received from Fidelity funds of £94,000 (2018: nil) is included in Note 5.During the year, the aggregate value of purchases and sales in Fidelity funds were £14,050,000 and £5,141,000 respectively (2018: £12,412,000 and £1,159,000).Amounts paid to the ACD in respect of services provided are disclosed in Note 6. Amounts due at the year end of £47,000 (2018: £24,000) are included within accrued expenses in Note 10.
16 Counterparty details of financial derivative transactions
31/10/19
BrokerCurrency Contracts CFD Futures Swaps Options Grand Total
£'000 £'000 £'000 £'000 £'000 £'000
Bank of America 1 - - - - 1
BNP Paribas 10 - - - - 10
Total 11 - - - - 11
17 Shareholders' funds
The fund has one share class; PI Accumulation Shares. The annual management charge is as follows:PI Accumulation Shares : 0.50%The distributions per share class are given in the Distribution Statement.
18 Post balance sheet event
The net asset value in pence per share at the balance sheet date and the latest practicable date prior to the publication of this report have been recorded below. The percentage increase/(decrease) is a reflection of market fluctuation during this period.
NAV as at 31/10/19 NAV as at 03/02/20 Increase/(decrease)%
PI Accumulation Shares 107.59 109.40 1.68
Fidelity Select 50 Balanced Fund
158
Distribution Statement
for the year ended 31 October 2019PI Accumulation Shares - final distribution No. 2 in pence per shareGroup 1 - Shares purchased on or before 31 October 2018.Group 2 - Shares purchased from 1 November 2018 to 31 October 2019.
Net revenueEqualisation
(Note 2)
Amount accumulated
31/12/19
Amount accumulated
31/12/18
Group 1 0.8249 - 0.8249 0.6272
Group 2 0.5580 0.2669 0.8249 0.6272
xxx xxx xxx xxx xxx
Portfolio Statement
Fidelity Allocator World Fund
159
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Equities - (58.63%)
670,993 Fidelity Index World Fund F Acc 16,316 31.03
302,172 Fidelity Index US Fund F Acc 9,223 17.54
170,625 Fidelity Index Europe ex UK Fund F Acc 2,605 4.95
74,181 Fidelity Index Japan Fund F Acc 1,270 2.42
61,357 Fidelity Index UK Fund F Acc 842 1.60
39,738 Fidelity Index Pacific ex Japan Fund F Acc 665 1.26
30,921 58.80
Financials - (14.05%)
112,852 iShares Core MSCI World UCITS 5,199 9.89
356,210 iShares MSCI World Small Cap UCITS ETF 1,425 2.71
24,274 iShares Developed Markets Property Yield UCITS ETF 536 1.02
5,076 iShares MSCI Canada UCITS ETF (USD) 517 0.98
7,677 14.60
Global Emerging Equities - (9.82%)
338,392 Fidelity Index Emerging Markets F Acc 5,295 10.07
5,295 10.07
Global REITS - (9.64%)
1,898,370 iShares Global Property Securities Equity Index Fund (UK) 4,588 8.72
4,588 8.72
Global Smaller Companies - (4.80%)
3,555,886 L&G Global Small Cap Equity Index Fund 3,818 7.26
3,818 7.26
Cash Funds/Money Market Funds - (2.36%)
0 Fidelity Institutional Liquidity Fund - Sterling C Acc 2 0.00
2 0.00
Global Government Bonds - (0.00%)
807 iShares Overseas Government Bond Index Fund L Acc 1 0.00
100 HSBC Global Funds ICAV - Global Government Bond Index Fund 1 0.00
2 0.00
Global Corporate Bonds - (0.00%)
708 iShares Overseas Corporate Bond Index Fund L Acc 1 0.00
1 0.00
Portfolio Statement
Fidelity Allocator World Fund
160
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Forward Foreign Exchange Contracts - (0.07%)
875,000 Bought HKD sold USD @ 0.127533 for settlement 26/11/2019 0 0.00
57,000 Bought JPY sold USD @ 0.009220 for settlement 26/11/2019 0 0.00
21,664,000 Bought KRW sold USD @ 0.000849 for settlement 26/11/2019 0 0.00
271,000 Bought MXN sold USD @ 0.051855 for settlement 26/11/2019 0 0.00
7,914,000 Bought RUB sold USD @ 0.015537 for settlement 26/11/2019 0 0.00
17,592 Bought USD sold TWD @ 30.469226 for settlement 26/11/2019 0 0.00
220,532 Bought USD sold EUR @ 0.897827 for settlement 26/11/2019 0 0.00
200,970 Bought USD sold GBP @ 0.776235 for settlement 26/11/2019 (1) 0.00
(1) 0.00
Portfolio of investments 52,303 99.45
Cash and other net assets/(liabilities) 284 0.55
Net assets 52,587 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Allocator Adventurous Fund
161
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Equities - (29.97%)
911,507 Fidelity Index World Fund F Acc 22,166 30.28
270,689 Fidelity Index US Fund F Acc 8,262 11.29
153,191 Fidelity Index Europe ex UK Fund F Acc 2,339 3.19
66,638 Fidelity Index Japan Fund F Acc 1,141 1.56
55,194 Fidelity Index UK Fund F Acc 757 1.03
35,622 Fidelity Index Pacific ex Japan Fund F Acc 596 0.81
35,261 48.16
Financials - (18.57%)
109,687 iShares Core MSCI World UCITS 5,053 6.90
682,119 iShares Global Government Bond UCITS ETF GBP Hedged 3,617 4.94
454,663 iShares Global Corporate Bond UCITS ETF GBP Hedged 2,388 3.26
377,364 iShares MSCI World Small Cap UCITS ETF 1,510 2.06
27,602 iShares Developed Markets Property Yield UCITS ETF 610 0.83
4,583 iShares MSCI Canada UCITS ETF (USD) 467 0.64
1,095 iShares Core Corporate Bond UCITS ETF 166 0.23
13,811 18.86
Global Emerging Equities - (0.00%)
376,756 Fidelity Index Emerging Markets F Acc 5,895 8.05
5,895 8.05
Global Government Bonds - (7.68%)
470,673 HSBC Global Funds ICAV - Global Government Bond Index Fund 5,131 7.01
5,131 7.01
Global REITS - (0.00%)
2,105,161 iShares Global Property Securities Equity Index Fund (UK) 5,088 6.95
5,088 6.95
Global Smaller Companies - (3.76%)
4,024,815 L&G Global Small Cap Equity Index Fund 4,321 5.90
4,321 5.90
Global Corporate Bonds - (4.91%)
1,937,216 iShares Overseas Corporate Bond Index Fund L Acc 3,144 4.29
3,144 4.29
Forward Foreign Exchange Contracts - ((0.20)%)
(3,930,512) Bought GBP sold USD @ 1.288270 for settlement 26/11/2019 20 0.03
1,022,000 Bought HKD sold USD @ 0.127533 for settlement 26/11/2019 0 0.00
22,874,000 Bought KRW sold USD @ 0.000849 for settlement 26/11/2019 0 0.00
8,973,000 Bought RUB sold USD @ 0.015537 for settlement 26/11/2019 0 0.00
34,039 Bought USD sold JPY @ 108.459870 for settlement 26/11/2019 0 0.00
167,089 Bought USD sold GBP @ 0.772043 for settlement 26/11/2019 0 0.00
1,221,839 Bought USD sold EUR @ 0.897827 for settlement 26/11/2019 (3) 0.00
17 0.02
Portfolio Statement
Fidelity Multi Asset Allocator Adventurous Fund
162
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Cash Funds/Money Market Funds - (1.85%)
0 Fidelity Institutional Liquidity Fund - Sterling C Acc 2 0.00
2 0.00
Portfolio of investments 72,670 99.24
Cash and other net assets/(liabilities) 542 0.76
Net assets 73,212 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Allocator Defensive Fund
163
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Financials - (36.70%)
2,959,207 iShares Global Government Bond UCITS ETF GBP Hedged 15,692 19.58
2,000,943 iShares Global Corporate Bond UCITS ETF GBP Hedged 10,511 13.11
4,878 iShares Core Corporate Bond UCITS ETF 739 0.92
98,136 iShares MSCI World Small Cap UCITS ETF 393 0.49
17,433 iShares Developed Markets Property Yield UCITS ETF 385 0.48
27,720 34.58
Global Government Bonds - (25.16%)
2,074,070 HSBC Global Funds ICAV - Global Government Bond Index Fund 22,612 28.21
22,612 28.21
Global Corporate Bonds - (20.48%)
8,531,871 iShares Overseas Corporate Bond Index Fund L Acc 13,847 17.28
13,847 17.28
Global Equities - (13.30%)
459,142 Fidelity Index World Fund F Acc 11,165 13.93
11,165 13.93
Global Emerging Equities - (1.89%)
103,042 Fidelity Index Emerging Markets F Acc 1,612 2.01
1,612 2.01
Global Smaller Companies - (0.94%)
1,108,485 L&G Global Small Cap Equity Index Fund 1,190 1.48
1,190 1.48
Global REITS - (1.52%)
479,825 iShares Global Property Securities Equity Index Fund (UK) 1,160 1.45
1,160 1.45
Forward Foreign Exchange Contracts - ((0.98)%)
(18,213,561) Bought GBP sold USD @ 1.288270 for settlement 26/11/2019 93 0.12
339,225 Bought USD sold GBP @ 0.769402 for settlement 26/11/2019 1 0.00
539,831 Bought USD sold CAD @ 1.317081 for settlement 26/11/2019 0 0.00
175,931 Bought USD sold JPY @ 108.459870 for settlement 26/11/2019 (1) 0.00
4,569,921 Bought USD sold EUR @ 0.897827 for settlement 26/11/2019 (8) (0.01)
85 0.11
Cash Funds/Money Market Funds - (0.50%)
0 Fidelity Institutional Liquidity Fund - Sterling C Acc 3 0.00
3 0.00
Portfolio of investments 79,394 99.05
Cash and other net assets/(liabilities) 762 0.95
Net assets 80,156 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Allocator Growth Fund
164
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Equities - (29.17%)
3,940,685 Fidelity Index World Fund F Acc 95,824 29.85
436,028 Fidelity Index US Fund F Acc 13,308 4.15
246,883 Fidelity Index Europe ex UK Fund F Acc 3,770 1.17
107,490 Fidelity Index Japan Fund F Acc 1,841 0.57
89,074 Fidelity Index UK Fund F Acc 1,222 0.38
58,199 Fidelity Index Pacific ex Japan Fund F Acc 973 0.30
116,938 36.43
Financials - (23.34%)
5,922,690 iShares Global Government Bond UCITS ETF GBP Hedged 31,408 9.78
3,979,414 iShares Global Corporate Bond UCITS ETF GBP Hedged 20,904 6.51
338,896 iShares Core MSCI World UCITS 15,613 4.86
1,197,157 iShares MSCI World Small Cap UCITS ETF 4,790 1.49
109,209 iShares Developed Markets Property Yield UCITS ETF 2,414 0.75
9,789 iShares Core Corporate Bond UCITS ETF 1,483 0.46
7,181 iShares MSCI Canada UCITS ETF (USD) 732 0.23
77,344 24.09
Global Government Bonds - (15.46%)
4,117,768 HSBC Global Funds ICAV - Global Government Bond Index Fund 44,892 13.98
44,892 13.98
Global Corporate Bonds - (9.71%)
16,929,535 iShares Overseas Corporate Bond Index Fund L Acc 27,477 8.56
27,477 8.56
Global Emerging Equities - (5.76%)
1,232,628 Fidelity Index Emerging Markets F Acc 19,286 6.01
19,286 6.01
Global REITS - (5.35%)
6,668,360 iShares Global Property Securities Equity Index Fund (UK) 16,117 5.02
16,117 5.02
Global Smaller Companies - (2.82%)
13,204,429 L&G Global Small Cap Equity Index Fund 14,177 4.42
14,177 4.42
Forward Foreign Exchange Contracts - ((0.48)%)
(34,788,443) Bought GBP sold USD @ 1.288270 for settlement 26/11/2019 178 0.06
(899,540) Bought GBP sold USD @ 1.283224 for settlement 26/11/2019 7 0.00
3,792,000 Bought HKD sold USD @ 0.127533 for settlement 26/11/2019 0 0.00
74,451,000 Bought KRW sold USD @ 0.000849 for settlement 26/11/2019 0 0.00
29,534,000 Bought RUB sold USD @ 0.015537 for settlement 26/11/2019 0 0.00
852,644 Bought USD sold CAD @ 1.317081 for settlement 26/11/2019 0 0.00
1,483,078 Bought USD sold GBP @ 0.772043 for settlement 26/11/2019 (1) 0.00
118,223 Bought USD sold AUD @ 1.463340 for settlement 26/11/2019 (1) 0.00
203,240 Bought USD sold JPY @ 108.459870 for settlement 26/11/2019 (1) 0.00
9,187,736 Bought USD sold EUR @ 0.897827 for settlement 26/11/2019 (17) (0.01)
165 0.05
Portfolio Statement
Fidelity Multi Asset Allocator Growth Fund
165
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Cash Funds/Money Market Funds - (1.38%)
0 Fidelity Institutional Liquidity Fund - Sterling C Acc 3 0.00
3 0.00
Portfolio of investments 316,399 98.56
Cash and other net assets/(liabilities) 4,608 1.44
Net assets 321,007 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Allocator Strategic Fund
166
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Equities - (27.03%)
1,754,066 Fidelity Index World Fund F Acc 42,654 27.87
42,654 27.87
Financials - (27.45%)
4,198,993 iShares Global Government Bond UCITS ETF GBP Hedged 22,267 14.55
2,835,622 iShares Global Corporate Bond UCITS ETF GBP Hedged 14,896 9.73
358,771 iShares MSCI World Small Cap UCITS ETF 1,435 0.94
7,059 iShares Core Corporate Bond UCITS ETF 1,069 0.70
30,269 iShares Developed Markets Property Yield UCITS ETF 669 0.44
40,336 26.36
Global Government Bonds - (21.20%)
2,990,377 HSBC Global Funds ICAV - Global Government Bond Index Fund 32,601 21.30
32,601 21.30
Global Corporate Bonds - (14.54%)
12,298,953 iShares Overseas Corporate Bond Index Fund L Acc 19,961 13.04
19,961 13.04
Global Emerging Equities - (3.82%)
393,678 Fidelity Index Emerging Markets F Acc 6,160 4.03
6,160 4.03
Global REITS - (3.55%)
2,152,292 iShares Global Property Securities Equity Index Fund (UK) 5,202 3.40
5,202 3.40
Global Smaller Companies - (1.87%)
4,261,885 L&G Global Small Cap Equity Index Fund 4,576 2.99
4,576 2.99
Forward Foreign Exchange Contracts - ((0.73)%)
(26,060,414) Bought GBP sold USD @ 1.288270 for settlement 26/11/2019 133 0.09
(479,926) Bought GBP sold USD @ 1.283224 for settlement 26/11/2019 4 0.00
1,254,000 Bought HKD sold USD @ 0.127533 for settlement 26/11/2019 0 0.00
9,370,000 Bought RUB sold USD @ 0.015537 for settlement 26/11/2019 0 0.00
722,052 Bought USD sold CAD @ 1.317081 for settlement 26/11/2019 0 0.00
823,789 Bought USD sold GBP @ 0.772043 for settlement 26/11/2019 (1) 0.00
207,002 Bought USD sold JPY @ 108.459870 for settlement 26/11/2019 (1) 0.00
6,521,299 Bought USD sold EUR @ 0.897827 for settlement 26/11/2019 (12) (0.01)
123 0.08
Cash Funds/Money Market Funds - (0.94%)
0 Fidelity Institutional Liquidity Fund - Sterling C Acc 2 0.00
2 0.00
Portfolio of investments 151,615 99.07
Cash and other net assets/(liabilities) 1,428 0.93
Net assets 153,043 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Balanced Income Fund
167
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
High Yield - (23.66%)
453,012 Fidelity Funds - Global Hybrids Bond Fund Y USD 3,799 5.59
603,143 Fidelity Funds - Asian High Yield Fund A MDist USD 3,725 5.48
171,559 Fidelity Funds - US High Yield Fund A MDist USD 1,506 2.22
14,169 M&G European Loan Fund 1,260 1.85
107,682 Fidelity Funds - European High Yield Fund A MDist EUR 1,055 1.55
36,576 PIMCO Funds Capital Securities Fund 467 0.69
443,663 NB Global Floating Rate Income Fund 396 0.58
271,883 Starwood European Real Estate Finance 269 0.40
396,785 Fair Oaks Income 225 0.33
199,686 TwentyFour Income Fund 214 0.32
330,826 Blackstone/GSO Loan Financing 213 0.31
196,476 CVC Credit Partners European Opportunities 198 0.29
28,545 Neuberger Berman CLO Income USD I5 Dis Fund 197 0.29
1,182 Fidelity Funds - Institutional European High Yield Fund I Acc EUR 189 0.28
52,619 Alcentra European Floating Rate Income Fund 51 0.08
13,764 20.26
Global Equities - (16.85%)
3,350,673 Fidelity Global Enhanced Income Fund W MDist 4,168 6.14
2,462,837 Fidelity Global Dividend Fund W MDist 3,381 4.98
965,240 Fidelity Funds - Global Financial Services Fund W Acc GBP 1,740 2.56
185,088 Fidelity Funds - Asia Pacific Dividend Fund A MIncome(G) USD 1,616 2.38
982,841 BlackRock Continental European Income Fund 1,455 2.14
778,393 Invesco European Equity Income Fund 1,012 1.49
13,372 19.68
Investment Grade Bonds - (15.71%)
9,206,071 Fidelity MoneyBuilder Income Fund A Inc 3,476 5.12
1,117,969 Fidelity Institutional UK Aggregate Bond Fund Acc Gross 2,564 3.77
1,471,377 Fidelity Extra Income Fund Y Inc 1,911 2.81
64,452 Fidelity Enhanced Reserve Fund I Qnc USD 510 0.75
8,461 12.46
Emerging Debt - (7.72%)
519,850 Fidelity Funds - Emerging Market Local Currency Debt Fund A MDist EUR 3,556 5.23
249,340 Fidelity Funds - Emerging Market Debt Fund A MDist USD 2,217 3.26
88,700 Finisterre Unconstrained Emerging Markets Fund 954 1.40
106,881 Fidelity Funds - China RMB Bond Fund QDist USD 798 1.17
7,525 11.08
Global Bonds - (7.07%)
2,342,430 Fidelity Renaissance F Inc GBP 2,450 3.61
169,294 Fidelity Funds - US Dollar Bond Fund A MDist USD 1,590 2.34
98,455 Fidelity Funds - Asian Bond Fund Y Acc USD 1,156 1.70
446,065 PFS Twentyfour Monument Bond 460 0.68
5,656 8.33
UK Equities - (6.72%)
4,675,846 Fidelity Enhanced Income Fund W 4,140 6.09
697,565 JO Hambro UK Equity Income Fund 890 1.31
5,030 7.40
Portfolio Statement
Fidelity Multi Asset Balanced Income Fund
168
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Financials - (8.82%)
395,910 Fidelity Global Quality Income UCITS ETF 1,883 2.77
513,300 HICL Infrastructure 883 1.30
18,787 Invesco Morningstar US Energy 652 0.96
91,443 Fidelity Europe Quality Income UCITS ETF 438 0.64
191,580 Real Estate Credit Investments 320 0.47
30,562 Xtrackers Harvest Csi300 UCITS 257 0.38
5,390 DBX Trust II Harvest China UCITS ETF 87 0.13
189,781 Catco Reinsurance Opportunities Fund C 44 0.06
4,564 6.72
Cash Funds/Money Market Funds - (3.69%)
229 Fidelity Institutional Liquidity Fund - Sterling C Acc 2,323 3.42
2,323 3.42
Infrastructure - (6.18%)
517,930 International Public Partnerships 820 1.21
360,549 Greencoat UK Wind 529 0.78
378,035 Sequoia Economic Infrastructure Income Fund 431 0.63
121,151 3i Infrastructure Fund 347 0.51
113,225 SQN Asset Finance Income Fund 91 0.13
2,218 3.27
Forward Foreign Exchange Contracts - ((0.12)%)
(20,098,700) Bought GBP sold USD @ 1.224220 for settlement 11/12/2019 928 1.37
(5,097,800) Bought GBP sold EUR @ 1.103558 for settlement 11/12/2019 228 0.34
(8,146,800) Bought GBP sold HKD @ 9.599846 for settlement 11/12/2019 48 0.07
(644,600) Bought GBP sold CHF @ 1.195790 for settlement 11/12/2019 34 0.05
(1,092,000) Bought GBP sold USD @ 1.258640 for settlement 11/12/2019 26 0.04
(4,789,900) Bought GBP sold CNY @ 8.778100 for settlement 11/12/2019 22 0.03
(698,200) Bought GBP sold AUD @ 1.799007 for settlement 11/12/2019 17 0.03
(2,804,000) Bought GBP sold CNY @ 8.775900 for settlement 11/12/2019 13 0.02
(290,000) Bought GBP sold EUR @ 1.110988 for settlement 11/12/2019 11 0.02
(24,077,000) Bought GBP sold JPY @ 131.541804 for settlement 11/12/2019 11 0.02
(1,004,000) Bought GBP sold CNY @ 8.895572 for settlement 11/12/2019 3 0.00
(65,000) Bought GBP sold CHF @ 1.215650 for settlement 11/12/2019 3 0.00
(492,000) Bought GBP sold HKD @ 9.681115 for settlement 11/12/2019 2 0.00
(86,654,000) Bought GBP sold JPY @ 139.829049 for settlement 11/12/2019 1 0.00
(53,000) Bought GBP sold AUD @ 1.822062 for settlement 11/12/2019 1 0.00
(41,000) Bought GBP sold AUD @ 1.886966 for settlement 11/12/2019 0 0.00
19,861,000 Bought JPY sold GBP @ 0.007123 for settlement 11/12/2019 0 0.00
42,000 Bought AUD sold GBP @ 0.552320 for settlement 11/12/2019 (1) 0.00
679,000 Bought EUR sold GBP @ 0.864855 for settlement 11/12/2019 (2) 0.00
488,000 Bought HKD sold GBP @ 0.102152 for settlement 11/12/2019 (2) 0.00
949,000 Bought CNY sold GBP @ 0.112370 for settlement 11/12/2019 (3) 0.00
24,188,000 Bought JPY sold GBP @ 0.007378 for settlement 11/12/2019 (6) (0.01)
22,694,000 Bought JPY sold GBP @ 0.007567 for settlement 11/12/2019 (10) (0.01)
414,216,800 Bought JPY sold GBP @ 0.007746 for settlement 11/12/2019 (251) (0.37)
1,073 1.58
Real Estate - (1.07%)
166,133 GCP Student Living 291 0.43
166,040 Tritax Eurobox (GB) 151 0.22
442 0.65
Portfolio Statement
Fidelity Multi Asset Balanced Income Fund
169
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Industrials - (0.69%)
129,524 Doric Nimrod Air Three 108 0.16
93,408 Amedeo Air Four Plus 72 0.11
38,882 Doric Nimrod Air Two Preferred 66 0.10
246 0.36
Utilities - (0.15%)
130,998 Greencoat Renewables (GB) 136 0.20
48,000 US Solar Fund 36 0.05
172 0.25
Miscellaneous - (0.13%)
61,408 UK Mortgages 40 0.06
40 0.06
Futures - (0.11%)
(100,000) EURO-BUND Commodity Future 06/12/2019 4 0.01
(30) FTSE 100 Index Future 20/12/2019 3 0.00
(200,000) Euro-BTP Commodity Future 06/12/2019 1 0.00
(4) FTSE 250 Y2 Index Future 20/12/2019 0 0.00
(100) E-Mini S&P 500 Index Future 20/12/2019 (2) 0.00
500,000 Long Gilt Commodity Future 27/12/2019 (4) (0.01)
(90) EURO STOXX 50 Commodity Future 20/12/2019 (5) (0.01)
(400) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (7) (0.01)
1,200,000 US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 (17) (0.03)
(27) (0.04)
Portfolio of investments 64,859 95.48
Cash and other net assets/(liabilities) 3,073 4.52
Net assets 67,932 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Income & Growth Fund
170
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Equities - (23.97%)
3,749,831 Fidelity Global Enhanced Income Fund W MDist 4,665 7.15
2,535,209 Fidelity Global Dividend Fund W MDist 3,481 5.33
335,711 Fidelity Funds - Asia Pacific Dividend Fund A M Income(G) USD 2,931 4.49
1,136,869 Fidelity Funds - Global Financial Services Fund W Acc GBP 2,050 3.14
1,090,987 BlackRock Continental European Income Fund 1,615 2.47
681,148 Invesco European Equity Income Fund 886 1.36
15,628 23.95
High Yield - (20.73%)
440,022 Fidelity Funds - Global Hybrids Bond Fund Y USD 3,689 5.65
570,811 Fidelity Funds - Asian High Yield Fund A MDist USD 3,524 5.40
168,970 Fidelity Funds - European High Yield Fund A MDist EUR 1,655 2.54
12,669 M&G European Loan Fund 1,127 1.73
95,963 Fidelity Funds - US High Yield Fund A MDist USD 842 1.29
73,532 Neuberger Berman CLO Income USD I5 Dis Fund 508 0.78
39,313 PIMCO Funds Capital Securities Fund 502 0.77
343,714 Starwood European Real Estate Finance 340 0.52
370,045 NB Global Floating Rate Income Fund 330 0.51
208,366 TwentyFour Income Fund 223 0.34
1,243 Fidelity Funds - Institutional European High Yield Fund I Acc EUR 199 0.30
182,727 CVC Credit Partners European Opportunities 184 0.28
108,713 Fair Oaks Income 62 0.10
93,755 Blackstone/GSO Loan Financing 60 0.09
41,392 Alcentra European Floating Rate Income Fund 40 0.06
13,285 20.36
Emerging Debt - (9.93%)
551,946 Fidelity Funds - Emerging Market Local Currency Debt Fund A MDist EUR 3,776 5.79
291,083 Fidelity Funds - Emerging Market Debt Fund A MDist USD 2,588 3.97
115,219 Finisterre Unconstrained Emerging Markets Fund 1,240 1.90
51,410 Fidelity Funds - China RMB Bond Fund QDist USD 384 0.59
7,988 12.24
Investment Grade Bonds - (7.53%)
6,345,440 Fidelity MoneyBuilder Income Fund A Inc 2,396 3.67
620,699 Fidelity Institutional UK Aggregate Bond Fund Acc Gross 1,423 2.18
126,523 Fidelity Enhanced Reserve Fund I Qnc USD 1,001 1.53
504,174 Fidelity Extra Income Fund Y Inc 655 1.00
5,475 8.39
Financials - (11.43%)
460,218 Fidelity Global Quality Income UCITS ETF 2,189 3.35
446,664 HICL Infrastructure 768 1.18
20,981 Invesco Morningstar US Energy 728 1.12
67,817 Xtrackers Harvest Csi300 UCITS 571 0.87
118,002 Fidelity Europe Quality Income UCITS ETF 565 0.87
181,505 Real Estate Credit Investments 303 0.46
5,301 DBX Trust II Harvest China UCITS ETF 86 0.13
211,616 Catco Reinsurance Opportunities Fund C 49 0.08
5,259 8.06
UK Equities - (7.59%)
4,576,774 Fidelity Enhanced Income Fund W 4,052 6.21
681,563 JO Hambro UK Equity Income Fund 870 1.33
4,922 7.54
Portfolio Statement
Fidelity Multi Asset Income & Growth Fund
171
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Bonds - (4.01%)
1,854,794 Fidelity Renaissance F Inc GBP 1,940 2.97
97,621 Fidelity Funds - US Dollar Bond Fund A MDist USD 917 1.41
47,540 Fidelity Funds - Asian Bond Fund Y Acc USD 558 0.86
273,393 PFS Twentyfour Monument Bond 282 0.43
3,697 5.66
Infrastructure - (6.93%)
449,150 International Public Partnerships 711 1.09
345,583 Greencoat UK Wind 507 0.78
140,518 3i Infrastructure Fund 403 0.62
349,286 Sequoia Economic Infrastructure Income Fund 398 0.61
111,264 SQN Asset Finance Income Fund 89 0.14
2,108 3.23
Cash Funds/Money Market Funds - (3.28%)
185 Fidelity Institutional Liquidity Fund - Sterling C Acc 1,877 2.88
1,877 2.88
Forward Foreign Exchange Contracts - ((0.06)%)
(19,512,400) Bought GBP sold USD @ 1.224220 for settlement 11/12/2019 901 1.38
(5,875,800) Bought GBP sold EUR @ 1.103558 for settlement 11/12/2019 263 0.40
(12,761,000) Bought GBP sold HKD @ 9.599846 for settlement 11/12/2019 74 0.11
(1,047,000) Bought GBP sold USD @ 1.227582 for settlement 11/12/2019 46 0.07
(698,500) Bought GBP sold CHF @ 1.195790 for settlement 11/12/2019 37 0.06
(1,107,000) Bought GBP sold AUD @ 1.799007 for settlement 11/12/2019 27 0.04
(4,377,200) Bought GBP sold CNY @ 8.778100 for settlement 11/12/2019 21 0.03
(20,350,000) Bought GBP sold JPY @ 131.634066 for settlement 11/12/2019 9 0.01
(310,000) Bought GBP sold EUR @ 1.125416 for settlement 11/12/2019 8 0.01
(724,000) Bought GBP sold HKD @ 9.767605 for settlement 11/12/2019 3 0.00
(481,000) Bought GBP sold CNY @ 8.895571 for settlement 11/12/2019 2 0.00
(43,000) Bought GBP sold CHF @ 1.212278 for settlement 11/12/2019 2 0.00
(39,000) Bought GBP sold CHF @ 1.228941 for settlement 11/12/2019 1 0.00
(70,000) Bought GBP sold AUD @ 1.847109 for settlement 11/12/2019 1 0.00
(77,763,000) Bought GBP sold JPY @ 139.829051 for settlement 11/12/2019 1 0.00
17,353,000 Bought JPY sold GBP @ 0.007100 for settlement 11/12/2019 1 0.00
210,000 Bought CNY sold GBP @ 0.109951 for settlement 11/12/2019 0 0.00
460,000 Bought CNY sold GBP @ 0.112370 for settlement 11/12/2019 (1) 0.00
63,000 Bought AUD sold GBP @ 0.547382 for settlement 11/12/2019 (1) 0.00
704,000 Bought EUR sold GBP @ 0.864855 for settlement 11/12/2019 (2) 0.00
669,000 Bought HKD sold GBP @ 0.102152 for settlement 11/12/2019 (3) 0.00
22,545,000 Bought JPY sold GBP @ 0.007473 for settlement 11/12/2019 (8) (0.01)
387,939,900 Bought JPY sold GBP @ 0.007746 for settlement 11/12/2019 (235) (0.36)
1,147 1.76
Real Estate - (1.74%)
245,900 GCP Student Living 430 0.66
158,984 Tritax Eurobox (GB) 145 0.22
575 0.88
Utilities - (0.17%)
117,999 Greencoat Renewables (GB) 123 0.19
48,000 US Solar Fund 36 0.06
159 0.24
Portfolio Statement
Fidelity Multi Asset Income & Growth Fund
172
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Industrials - (0.54%)
110,377 Amedeo Air Four Plus 85 0.13
39,160 Doric Nimrod Air Two Preferred 66 0.10
151 0.23
Miscellaneous - (0.10%)
38,779 UK Mortgages 25 0.04
25 0.04
Contracts for Difference - (0.00%)
608,376 MSCI Japan Financials Index (CFD) 18 0.03
18 0.03
Futures - (0.21%)
(60) FTSE 100 Index Future 20/12/2019 5 0.01
(100,000) EURO-BUND Commodity Future 06/12/2019 4 0.01
(16) FTSE 250 Y2 Index Future 20/12/2019 1 0.00
(100,000) Euro-BTP Commodity Future 06/12/2019 0 0.00
300,000 Long Gilt Commodity Future 27/12/2019 (2) 0.00
(600) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (11) (0.02)
900,000 US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 (13) (0.02)
(16) (0.02)
Portfolio of investments 62,298 95.47
Cash and other net assets/(liabilities) 2,963 4.53
Net assets 65,261 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Income Fund
173
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Investment Grade Bonds - (24.61%)
233,715,452 Fidelity MoneyBuilder Income Fund A Inc 88,251 10.33
28,959,284 Fidelity Institutional UK Aggregate Bond Fund Acc Gross 66,404 7.77
31,664,241 Fidelity Extra Income Fund Y Inc 41,132 4.81
41,432 Fidelity Enhanced Reserve Fund I Qnc USD 328 0.04
196,115 22.95
High Yield - (22.06%)
8,719,757 Fidelity Funds - Asian High Yield Fund A MDist USD 53,840 6.30
4,962,849 Fidelity Funds - Global Hybrids Bond Fund Y USD 41,613 4.87
3,115,303 Fidelity Funds - US High Yield Fund A MDist USD 27,338 3.20
166,409 M&G European Loan Fund 14,802 1.73
897,232 Fidelity Funds - European High Yield Fund A MDist EUR 8,787 1.03
679,118 PIMCO Funds Capital Securities Fund 8,679 1.02
5,697,278 NB Global Floating Rate Income Fund 5,082 0.59
28,448 Fidelity Funds - Institutional European High Yield Fund I Acc EUR 4,559 0.53
3,688,639 TwentyFour Income Fund 3,947 0.46
2,692,039 CVC Credit Partners European Opportunities 2,719 0.32
2,096,458 Starwood European Real Estate Finance 2,071 0.24
1,747,390 Alcentra European Floating Rate Income Fund 1,698 0.20
2,412,211 Blackstone/GSO Loan Financing 1,556 0.18
2,125,356 Fair Oaks Income 1,205 0.14
104,139 Neuberger Berman CLO Income USD I5 Dis Fund 719 0.08
178,615 20.90
Global Equities - (16.97%)
44,522,602 Fidelity Global Enhanced Income Fund W MDist 55,386 6.48
30,857,317 Fidelity Global Dividend Fund W MDist 42,367 4.96
10,115,184 Fidelity Funds - Global Financial Services Fund W Acc GBP 18,239 2.13
9,040,355 BlackRock Continental European Income Fund 13,380 1.57
7,798,117 Invesco European Equity Income Fund 10,138 1.19
139,510 16.32
Emerging Debt - (6.72%)
5,333,882 Fidelity Funds - Emerging Market Local Currency Debt Fund A MDist EUR 36,491 4.27
3,046,805 Fidelity Funds - Emerging Market Debt Fund A MDist USD 27,089 3.17
1,303,747 Fidelity Funds - China RMB Bond Fund QDist USD 9,738 1.14
638,889 Finisterre Unconstrained Emerging Markets Fund 6,874 0.80
80,192 9.38
Global Bonds - (6.00%)
33,487,509 Fidelity Renaissance F Inc GBP 35,028 4.10
2,254,702 Fidelity Funds - US Dollar Bond Fund A MDist USD 21,178 2.48
1,565,338 Fidelity Funds - Asian Bond Fund Y Acc USD 18,386 2.15
4,085,887 PFS Twentyfour Monument Bond 4,213 0.49
78,805 9.22
UK Equities - (5.52%)
56,181,281 Fidelity Enhanced Income Fund W 49,737 5.82
3,269,455 JO Hambro UK Equity Income Fund 4,172 0.49
53,909 6.31
Portfolio Statement
Fidelity Multi Asset Income Fund
174
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Financials - (6.56%)
4,519,301 Fidelity Global Quality Income UCITS ETF 21,494 2.51
7,529,450 HICL Infrastructure 12,951 1.52
2,873,181 Real Estate Credit Investments 4,798 0.56
94,891 Invesco Morningstar US Energy 3,294 0.39
108,380 DBX Trust II Harvest China UCITS ETF 1,750 0.20
3,648,323 Catco Reinsurance Opportunities Fund C 845 0.10
45,132 5.28
Infrastructure - (4.63%)
5,913,770 International Public Partnerships 9,367 1.10
7,397,510 Sequoia Economic Infrastructure Income Fund 8,433 0.99
5,480,706 Greencoat UK Wind 8,035 0.94
1,514,952 3i Infrastructure Fund 4,340 0.51
30,175 3.53
Cash Funds/Money Market Funds - (3.84%)
1,893 Fidelity Institutional Liquidity Fund - Sterling C Acc 19,220 2.25
19,220 2.25
Forward Foreign Exchange Contracts - ((0.13)%)
(261,393,600) Bought GBP sold USD @ 1.224220 for settlement 11/12/2019 12,065 1.41
(59,398,200) Bought GBP sold EUR @ 1.103558 for settlement 11/12/2019 2,657 0.31
(8,421,500) Bought GBP sold CHF @ 1.195790 for settlement 11/12/2019 450 0.05
(78,531,900) Bought GBP sold CNY @ 8.778100 for settlement 11/12/2019 368 0.04
(32,674,200) Bought GBP sold HKD @ 9.599846 for settlement 11/12/2019 191 0.02
(4,175,000) Bought GBP sold EUR @ 1.110988 for settlement 11/12/2019 161 0.02
(275,289,000) Bought GBP sold JPY @ 131.634070 for settlement 11/12/2019 125 0.01
(2,819,100) Bought GBP sold AUD @ 1.799007 for settlement 11/12/2019 68 0.01
(11,888,000) Bought GBP sold CNY @ 8.895572 for settlement 11/12/2019 38 0.00
(455,000) Bought GBP sold CHF @ 1.222100 for settlement 11/12/2019 16 0.00
(1,166,395,000) Bought GBP sold JPY @ 139.829050 for settlement 11/12/2019 12 0.00
(375,000) Bought GBP sold AUD @ 1.822062 for settlement 11/12/2019 6 0.00
(472,000) Bought GBP sold AUD @ 1.881759 for settlement 11/12/2019 0 0.00
245,865,000 Bought JPY sold GBP @ 0.007147 for settlement 11/12/2019 (2) 0.00
1,867,000 Bought HKD sold GBP @ 0.102298 for settlement 11/12/2019 (7) 0.00
369,000 Bought AUD sold GBP @ 0.551998 for settlement 11/12/2019 (7) 0.00
318,499,000 Bought JPY sold GBP @ 0.007209 for settlement 11/12/2019 (22) 0.00
10,558,000 Bought CNY sold GBP @ 0.112370 for settlement 11/12/2019 (33) 0.00
10,461,000 Bought EUR sold GBP @ 0.864855 for settlement 11/12/2019 (36) 0.00
308,446,000 Bought JPY sold GBP @ 0.007435 for settlement 11/12/2019 (91) (0.01)
5,313,093,900 Bought JPY sold GBP @ 0.007746 for settlement 11/12/2019 (3,214) (0.38)
12,745 1.49
Industrials - (0.53%)
1,677,376 Amedeo Air Four Plus 1,292 0.15
1,406,848 Doric Nimrod Air Three 1,168 0.14
559,693 Doric Nimrod Air Two Preferred 946 0.11
3,406 0.40
Utilities - (0.23%)
2,074,892 Greencoat Renewables (GB) 2,160 0.25
768,000 US Solar Fund 581 0.07
2,741 0.32
Portfolio Statement
Fidelity Multi Asset Income Fund
175
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Real Estate - (0.65%)
2,520,705 Tritax Eurobox (GB) 2,299 0.27
2,299 0.27
Miscellaneous - (0.14%)
1,327,226 UK Mortgages 864 0.10
864 0.10
Futures - (0.14%)
(2,400,000) EURO-BUND Commodity Future 06/12/2019 91 0.01
(600) FTSE 100 Index Future 20/12/2019 52 0.01
(6,700,000) Euro-BTP Commodity Future 06/12/2019 19 0.00
(128) FTSE 250 Y2 Index Future 20/12/2019 7 0.00
(5,700) E-Mini S&P Consumer Staples Index Future 20/12/2019 (34) 0.00
(2,300) E-Mini S&P 500 Index Future 20/12/2019 (53) (0.01)
8,700,000 Long Gilt Commodity Future 27/12/2019 (66) (0.01)
(1,430) EURO STOXX 50 Commodity Future 20/12/2019 (86) (0.01)
(7,300) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (135) (0.02)
10,000,000 US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 (145) (0.02)
(350) (0.04)
Portfolio of investments 843,378 98.68
Cash and other net assets/(liabilities) 11,284 1.32
Net assets 854,662 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Open Adventurous Fund
176
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
UK Equities - (20.21%)
55,303,729 FCCF II - Fidelity UK Equity Fund I Acc GBP 56,283 20.66
56,283 20.66
North American Equities - (14.68%)
5,285,515 FCCF II - Fidelity North America Equity Fund I Acc USD 44,418 16.30
44,418 16.30
European Equities - (11.04%)
4,417,447 FCCF II - Fidelity Europe ex-UK Equity Fund I Acc EUR 39,154 14.37
39,154 14.37
Global Aggregate Bonds - (0.00%)
2,559,062 FCCF II - Fidelity Global Aggregate Bond Fund I Acc GBP 27,200 9.98
27,200 9.98
Pacific ex Japan Equities - (6.90%)
3,084,759 Fidelity Asia Pacific ex-Japan Equity Fund I Acc USD 23,541 8.64
23,541 8.64
Japan Equities - (4.44%)
2,404,113 FCCF II - Fidelity Japan Equity Fund I Acc JPY 16,740 6.14
16,740 6.14
Emerging Market Equities - (4.99%)
2,016,711 FCCF II - Fidelity Global Emerging Markets Fund I Acc USD 16,509 6.06
16,509 6.06
Gold - (3.95%)
7,435,910 Investec Global Gold Fund I Acc 11,772 4.32
11,772 4.32
Cash Funds/Money Market Funds - (8.50%)
849 Fidelity Institutional Liquidity Fund - Sterling C Acc 8,618 3.16
0 Fidelity Institutional Liquidity Fund - USD C Acc 2 0.00
8,620 3.16
High Yield - (0.00%)
805,503 FCCF II - Fidelity Global Sub-IG Fixed Income Fund I Acc GBP 8,606 3.16
8,606 3.16
Financials - (7.16%)
173,634 iShares Physical Gold ETC 3,951 1.45
15,914 SPDR S&P US Dividend Aristocrats UCITS ETF 710 0.26
4,661 1.71
Volatility - (0.00%)
4,171 Assenagon Alpha Volatility (I) INC-EUR 3,831 1.41
3,831 1.41
Macro Absolute Return - (2.36%)
2,641,428 Majedie Tortoise Fund Z GBP 2,409 0.88
2,409 0.88
Energy Infrastructure - (0.00%)
323,836 Pimco GIS MLP & Energy Infrastructure Fund 2,264 0.83
2,264 0.83
Warrants - (0.00%)
27,780 BBG Energy Trust Sub Index (Warrants) 2,042 0.75
2,042 0.75
Portfolio Statement
Fidelity Multi Asset Open Adventurous Fund
177
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Property - (0.94%)
40 Fidelity International Eurozone Select Real Estate Fund 205 0.08
205 0.08
Forward Foreign Exchange Contracts - (0.03%)
(24,344,600) Bought GBP sold USD @ 1.289925 for settlement 27/11/2019 101 0.04
(4,757,900) Bought GBP sold EUR @ 1.154401 for settlement 22/11/2019 26 0.01
127 0.05
Futures - (0.10%)
(9,200,000) EURO-BUND Commodity Future 06/12/2019 93 0.03
(870) FTSE 100 Index Future 20/12/2019 75 0.03
16,700 NIKKEI 225 Mini Commodity Future 12/12/2019 29 0.01
214 FTSE 250 Y2 Index Future 20/12/2019 17 0.01
25,800 Euro STOXX Bank Future 20/12/2019 (54) (0.02)
(4,400) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (89) (0.03)
71 0.03
Contracts for Difference - ((0.06)%)
15,024 IXM Finance Select Sector Index (CFD) 217 0.08
4,412 AMEX Energy Select Index (CFD) 6 0.00
(3,314) PHLX Semi Conductor Index (CFD) (823) (0.30)
(600) (0.22)
Portfolio of investments 267,853 98.31
Cash and other net assets/(liabilities) 4,574 1.69
Net assets 272,427 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Open Defensive Fund
178
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Aggregate Bonds - (0.00%)
2,064,542 FCCF II - Fidelity Global Aggregate Bond Fund I Acc GBP 21,944 33.99
21,944 33.99
Cash Funds/Money Market Funds - (7.89%)
970 Fidelity Institutional Liquidity Fund - Sterling C Acc 9,846 15.25
0 Fidelity Institutional Liquidity Fund - USD C Acc 2 0.00
9,848 15.25
UK Equities - (11.54%)
7,280,007 FCCF II - Fidelity UK Equity Fund I Acc GBP 7,409 11.47
7,409 11.47
High Yield - (0.00%)
514,594 FCCF II - Fidelity Global Sub-IG Fixed Income Fund I Acc GBP 5,498 8.52
5,498 8.52
Alternatives - (0.00%)
2,644,849 FCCF II - Fidelity Alternative Listed Equity Fund I Acc GBP 2,643 4.09
2,643 4.09
North American Equities - (4.06%)
304,794 FCCF II - Fidelity North America Equity Fund I Acc USD 2,562 3.97
2,562 3.97
European Equities - (4.02%)
261,724 FCCF II - Fidelity Europe ex-UK Equity Fund I Acc EUR 2,320 3.59
2,320 3.59
Gold - (3.55%)
1,194,170 Investec Global Gold Fund I Acc 1,891 2.93
1,891 2.93
Financials - (6.79%)
65,698 iShares Physical Gold ETC 1,495 2.32
5,502 SPDR S&P US Dividend Aristocrats UCITS ETF 245 0.38
104,432 Highbridge Multi Strategy Fund 0 0.00
1,740 2.69
Pacific ex Japan Equities - (2.08%)
226,982 Fidelity Asia Pacific ex-Japan Equity Fund I Acc USD 1,732 2.68
1,732 2.68
Emerging Market Equities - (1.80%)
189,243 FCCF II - Fidelity Global Emerging Markets Fund I Acc USD 1,549 2.40
1,549 2.40
Volatility - (0.00%)
1,265 Assenagon Alpha Volatility (I) INC-EUR 1,162 1.80
1,162 1.80
Japan Equities - (1.33%)
131,190 FCCF II - Fidelity Japan Equity Fund I Acc JPY 914 1.41
914 1.41
Multi-Strategy - (1.85%)
901 Helium Fund - Helium Performance E EUR 791 1.23
28,103 Henderson Alternative Strategies Trust 74 0.11
865 1.34
Energy Infrastructure - (0.00%)
95,650 Pimco GIS MLP & Energy Infrastructure Fund 669 1.04
669 1.04
Portfolio Statement
Fidelity Multi Asset Open Defensive Fund
179
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Macro Absolute Return - (2.83%)
580,551 Majedie Tortoise Fund Z GBP 530 0.82
530 0.82
Warrants - (0.00%)
6,569 BBG Energy Trust Sub Index (Warrants) 483 0.75
483 0.75
Property - (1.21%)
32 Fidelity International Eurozone Select Real Estate Fund 163 0.25
163 0.25
Forward Foreign Exchange Contracts - ((0.14)%)
(5,800,700) Bought GBP sold USD @ 1.289925 for settlement 27/11/2019 24 0.04
(2,478,500) Bought GBP sold EUR @ 1.154401 for settlement 22/11/2019 13 0.02
37 0.06
Futures - (0.24%)
(2,200,000) EURO-BUND Commodity Future 06/12/2019 23 0.03
(220) FTSE 100 Index Future 20/12/2019 19 0.03
3,800 NIKKEI 225 Mini Commodity Future 12/12/2019 7 0.01
50 FTSE 250 Y2 Index Future 20/12/2019 4 0.01
(550) E-Mini S&P 500 Index Future 20/12/2019 (13) (0.02)
6,100 Euro STOXX Bank Future 20/12/2019 (13) (0.02)
1,400,000 US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 (20) (0.03)
(1,100) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (22) (0.03)
(15) (0.02)
Contracts for Difference - ((0.07)%)
3,552 IXM Finance Select Sector Index (CFD) 51 0.08
1,042 AMEX Energy Select Index (CFD) 1 0.00
(599) PHLX Semi Conductor Index (CFD) (158) (0.24)
(106) (0.16)
Portfolio of investments 63,838 98.87
Cash and other net assets/(liabilities) 730 1.13
Net assets 64,568 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Open Growth Fund
180
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
UK Equities - (23.33%)
139,165,989 FCCF II - Fidelity UK Equity Fund I Acc GBP 141,629 22.55
141,629 22.55
Global Aggregate Bonds - (0.00%)
7,968,194 FCCF II - Fidelity Global Aggregate Bond Fund I Acc GBP 84,695 13.48
84,695 13.48
European Equities - (12.02%)
9,150,903 FCCF II - Fidelity Europe ex-UK Equity Fund I Acc EUR 81,109 12.91
81,109 12.91
North American Equities - (12.38%)
8,787,605 FCCF II - Fidelity North America Equity Fund I Acc USD 73,849 11.76
73,849 11.76
Pacific ex Japan Equities - (5.05%)
4,758,680 Fidelity Asia Pacific ex-Japan Equity Fund I Acc USD 36,315 5.78
36,315 5.78
Cash Funds/Money Market Funds - (1.70%)
3,327 Fidelity Institutional Liquidity Fund - Sterling C Acc 33,780 5.38
2 Fidelity Institutional Liquidity Fund - USD C Acc 17 0.00
33,797 5.38
High Yield - (0.00%)
2,916,764 FCCF II - Fidelity Global Sub-IG Fixed Income Fund I Acc GBP 31,164 4.96
31,164 4.96
Emerging Market Equities - (4.04%)
3,776,863 FCCF II - Fidelity Global Emerging Markets Fund I Acc USD 30,917 4.92
30,917 4.92
Japan Equities - (4.34%)
3,754,003 FCCF II - Fidelity Japan Equity Fund I Acc JPY 26,139 4.16
26,139 4.16
Gold - (3.48%)
13,560,011 Investec Global Gold Fund I Acc 21,467 3.42
21,467 3.42
Financials - (5.33%)
530,343 iShares Physical Gold ETC 12,068 1.92
81,238 SPDR S&P US Dividend Aristocrats UCITS ETF 3,622 0.58
311,461 Highbridge Multi Strategy Fund 0 0.00
15,690 2.50
Alternatives - (0.00%)
12,461,242 FCCF II - Fidelity Alternative Listed Equity Fund I Acc GBP 12,454 1.98
12,454 1.98
Volatility - (0.00%)
9,582 Assenagon Alpha Volatility (I) Inc EUR 8,802 1.40
8,802 1.40
Energy Infrastructure - (0.00%)
993,712 Pimco GIS MLP & Energy Infrastructure Fund 6,946 1.11
6,946 1.11
Macro Absolute Return - (2.60%)
7,023,594 Majedie Tortoise Fund Z GBP 6,407 1.02
6,407 1.02
Portfolio Statement
Fidelity Multi Asset Open Growth Fund
181
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Warrants - (0.00%)
63,637 BBG Energy Trust Sub Index (Warrants) 4,678 0.74
4,678 0.74
Property - (1.90%)
462 Fidelity International Eurozone Select Real Estate Fund 2,368 0.38
2,368 0.38
Multi-Strategy - (0.45%)
206,499 Henderson Alternative Strategies Trust 543 0.09
543 0.09
Futures - (0.17%)
(18,200,000) US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 260 0.04
(21,200,000) EURO-BUND Commodity Future 06/12/2019 217 0.03
(1,200) FTSE 100 Index Future 20/12/2019 104 0.02
38,200 NIKKEI 225 Mini Commodity Future 12/12/2019 67 0.01
490 FTSE 250 Y2 Index Future 20/12/2019 38 0.01
59,500 Euro STOXX Bank Future 20/12/2019 (124) (0.02)
(10,000) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (202) (0.03)
360 0.06
Forward Foreign Exchange Contracts - ((0.03)%)
(56,101,100) Bought GBP sold USD @ 1.289925 for settlement 27/11/2019 233 0.04
(13,132,600) Bought GBP sold EUR @ 1.154401 for settlement 22/11/2019 71 0.01
304 0.05
Contracts for Difference - ((0.08)%)
34,417 IXM Finance Select Sector Index (CFD) 502 0.08
10,105 AMEX Energy Select Index (CFD) 14 0.00
(7,369) PHLX Semi Conductor Index (CFD) (1,841) (0.29)
(1,325) (0.21)
Portfolio of investments 618,308 98.44
Cash and other net assets/(liabilities) 9,881 1.56
Net assets 628,189 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Multi Asset Open Strategic Fund
182
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Aggregate Bonds - (0.00%)
16,101,456 FCCF II - Fidelity Global Aggregate Bond Fund I Acc GBP 171,142 24.49
171,142 24.49
UK Equities - (14.72%)
112,556,705 FCCF II - Fidelity UK Equity Fund I Acc GBP 114,549 16.39
114,549 16.39
European Equities - (7.88%)
7,089,411 FCCF II - Fidelity Europe ex-UK Equity Fund I Acc EUR 62,837 8.99
62,837 8.99
Cash Funds/Money Market Funds - (8.79%)
6,179 Fidelity Institutional Liquidity Fund - Sterling C Acc 62,733 8.98
2 Fidelity Institutional Liquidity Fund - USD C Acc 15 0.00
62,748 8.98
North American Equities - (7.84%)
6,256,586 FCCF II - Fidelity North America Equity Fund I Acc USD 52,579 7.53
52,579 7.53
High Yield - (0.00%)
4,780,483 FCCF II - Fidelity Global Sub-IG Fixed Income Fund I Acc GBP 51,077 7.31
51,077 7.31
Pacific ex Japan Equities - (3.16%)
3,568,021 Fidelity Asia Pacific ex-Japan Equity Fund I Acc USD 27,229 3.90
27,229 3.90
Alternatives - (0.00%)
25,586,960 FCCF II - Fidelity Alternative Listed Equity Fund I Acc GBP 25,572 3.66
25,572 3.66
Gold - (3.53%)
15,397,370 Investec Global Gold Fund I Acc 24,376 3.49
24,376 3.49
Emerging Market Equities - (2.03%)
2,364,327 FCCF II - Fidelity Global Emerging Markets Fund I Acc USD 19,354 2.77
19,354 2.77
Financials - (6.11%)
556,888 iShares Physical Gold ETC 12,672 1.81
122,800 SPDR S&P US Dividend Aristocrats UCITS ETF 5,476 0.78
739,396 Highbridge Multi Strategy Fund 0 0.00
18,148 2.60
Japan Equities - (2.12%)
2,520,070 FCCF II - Fidelity Japan Equity Fund I Acc JPY 17,547 2.51
17,547 2.51
Volatility - (0.00%)
10,483 Assenagon Alpha Volatility (I) Inc EUR 9,629 1.38
9,629 1.38
Macro Absolute Return - (2.87%)
9,797,766 Majedie Tortoise Fund Z GBP 8,938 1.28
8,938 1.28
Multi-Strategy - (1.38%)
7,974 Helium Fund - Helium Performance E EUR 7,001 1.00
156,799 Henderson Alternative Strategies Trust 412 0.06
7,413 1.06
Portfolio Statement
Fidelity Multi Asset Open Strategic Fund
183
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Energy Infrastructure - (0.00%)
1,009,646 Pimco GIS MLP & Energy Infrastructure Fund 7,057 1.01
7,057 1.01
Warrants - (0.00%)
70,339 BBG Energy Trust Sub Index (Warrants) 5,171 0.74
5,171 0.74
Property - (1.55%)
350 Fidelity International Eurozone Select Real Estate Fund 1,796 0.26
1,796 0.26
Forward Foreign Exchange Contracts - ((0.11)%)
(62,141,400) Bought GBP sold USD @ 1.289925 for settlement 27/11/2019 258 0.04
(21,568,600) Bought GBP sold EUR @ 1.154401 for settlement 22/11/2019 117 0.02
375 0.05
Futures - (0.18%)
(23,400,000) EURO-BUND Commodity Future 06/12/2019 233 0.03
(2,500) FTSE 100 Index Future 20/12/2019 216 0.03
(11,100,000) US 10 Year Treasury Note (CBT) Commodity Future 19/12/2019 158 0.02
42,700 NIKKEI 225 Mini Commodity Future 12/12/2019 75 0.01
542 FTSE 250 Y2 Index Future 20/12/2019 42 0.01
65,700 Euro STOXX Bank Future 20/12/2019 (137) (0.02)
(11,100) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (226) (0.03)
361 0.05
Contracts for Difference - ((0.07)%)
38,041 IXM Finance Select Sector Index (CFD) 553 0.08
11,170 AMEX Energy Select Index (CFD) 15 0.00
(6,399) PHLX Semi Conductor Index (CFD) (1,686) (0.24)
(1,118) (0.16)
Portfolio of investments 686,780 98.29
Cash and other net assets/(liabilities) 11,934 1.71
Net assets 698,714 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Open World Fund
184
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
North American Equities - (37.58%)
56,221,454 FCCF II - Fidelity North America Equity Fund I Acc USD 472,474 34.89
14,632,571 Old Mutual North American Equity Fund U2 34,372 2.54
506,846 37.43
European Equities - (13.78%)
25,090,486 FCCF II - Fidelity Europe ex-UK Equity Fund I Acc EUR 222,388 16.42
222,388 16.42
Pacific ex Japan Equities - (8.28%)
17,401,454 Fidelity Asia Pacific ex-Japan Equity Fund I Acc USD 132,796 9.81
132,796 9.81
Emerging Market Equities - (8.37%)
15,905,924 FCCF II - Fidelity Global Emerging Markets Fund I Acc USD 130,205 9.62
130,205 9.62
UK Equities - (10.38%)
113,172,553 FCCF II - Fidelity UK Equity Fund I Acc GBP 115,176 8.51
115,176 8.51
Japan Equities - (8.57%)
16,129,940 FCCF II - Fidelity Japan Equity Fund I Acc JPY 112,313 8.29
112,313 8.29
Financials - (7.80%)
1,499,459 SPDR S&P US Dividend Aristocrats UCITS ETF 66,861 4.94
66,861 4.94
Gold - (4.45%)
36,645,103 Investec Global Gold Fund I Acc 58,013 4.28
58,013 4.28
Forward Foreign Exchange Contracts - (0.05%)
(86,348,400) Bought GBP sold USD @ 1.289925 for settlement 27/11/2019 358 0.03
358 0.03
Cash Funds/Money Market Funds - (0.00%)
1 Fidelity Institutional Liquidity Fund - Sterling C Acc 6 0.00
0 Fidelity Institutional Liquidity Fund - USD C Acc 0 0.00
6 0.00
Futures - (0.22%)
84,000 NIKKEI 225 Mini Commodity Future 12/12/2019 148 0.01
1,070 FTSE 250 Y2 Index Future 20/12/2019 84 0.01
(6,850) E-Mini S&P 500 Index Future 20/12/2019 (158) (0.01)
85,700 Euro STOXX Bank Future 20/12/2019 (179) (0.01)
(21,600) E-Mini S&P Technology Select Sector Index Future 20/12/2019 (437) (0.03)
(542) (0.04)
Portfolio Statement
Fidelity Open World Fund
185
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Contracts for Difference - ((0.09)%)
75,170 IXM Finance Select Sector Index (CFD) 1,084 0.08
22,074 AMEX Energy Select Index (CFD) 30 0.00
(16,576) PHLX Semi Conductor Index (CFD) (4,164) (0.31)
(3,050) (0.23)
Portfolio of investments 1,341,370 99.06
Cash and other net assets/(liabilities) 12,641 0.94
Net assets 1,354,011 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Portfolio Statement
Fidelity Select 50 Balanced Fund
186
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Global Fixed Income - (11.37%)
499,402 Colchester Global Bond Fund GBP Hedged Acc 6,015 6.97
3,867,331 Jupiter Strageic Bond Fund I Acc 4,258 4.94
6,787,065 Standard Life Global Index Linked Bond Fund S-Acc 4,232 4.91
239,648 Fidelity Funds - Emerging Market Local Currency Debt Fund Y-Acc-USD 1,707 1.98
308,674 JPM Global High Yield Bond Fund C-Acc 415 0.48
16,627 19.27
UK Fixed Income - (20.25%)
5,365,987 Fidelity Strategic Bond Fund Y-Acc 6,874 7.97
5,464,030 M&G Corporate Bond Fund I-Acc GBP 4,304 4.99
248,540 Fidelity MoneyBuilder Income Fund Y-Acc 3,452 4.00
14,630 16.96
UK Equities - (11.84%)
92,229 Fidelity Special Situations Fund - W Acc 3,400 3.94
1,677,763 Majedie UK Equity Fund 2,984 3.46
591,394 Liontrust UK Growth Fund I 2,616 3.03
9,000 10.43
Global Equities - (6.94%)
1,207,435 Fidelity Global Dividend Fund W-Acc (UK) 2,921 3.39
60,009 Fidelity Global Special Situations Fund A-Acc 2,534 2.94
975,972 Rathbone Global Opportunities Fund Acc 2,438 2.83
227,605 Invesco Global Equity Income Fund 821 0.95
8,714 10.10
Europe ex UK Equities - (10.37%)
1,232,850 FP CRUX European Special Situations Fund 3,533 4.10
1,330,442 Invesco European Equity Income Fund 2,620 3.04
487,761 JO Hambro European Select Values Fund 2,526 2.93
8,679 10.06
Macro Absolute Return - (0.00%)
1,435,852 Invesco Global Targeted Returns Fund 3,389 3.93
13,737 BlackRock Style Advantage Fund I2 GBP Hedged 1,275 1.48
413 Serviced Platform SICAV ADG Systematic Macro UCITS 43 0.05
4,707 5.46
Pacific ex Japan Equities - (5.49%)
1,862,826 Old Mutual SE Ii-Asia Pacific Fund 3,344 3.88
1,228,359 Maple-Brown Abbott Asia Pacific 1,094 1.27
4,438 5.14
North American Equities - (9.00%)
347,476 JPMorgan Fund ICVC - US Select 1,749 2.03
519,477 JPMorgan Fund ICVC - US Equity Income Fund 1,572 1.82
261,608 Old Mutual North American Equity Fund U2 615 0.71
3,936 4.56
Commodities - (2.97%)
1,928,196 Investec Global Gold Fund I Acc 3,053 3.54
3,053 3.54
Japan Equities - (5.14%)
172,722 Baillie Gifford Japanese Fund B Acc 2,971 3.44
2,971 3.44
Portfolio Statement
Fidelity Select 50 Balanced Fund
187
as at 31 October 2019
Percentage Holdings/ Market value/ of total Holdings Unrealised gain/(loss) net assets Equivalent Portfolio of investments £’000 %
Infrastructure - (0.00%)
2,032,845 FP Foresight UK Infrast Fund 2,577 2.99
2,577 2.99
Property - (2.99%)
884,337 iShares Global Property Securities Equity Index Fund (UK) 2,137 2.48
2,137 2.48
Volatility - (0.00%)
2,249 Assenagon Alpha Volatility (I) INC-EUR 2,065 2.39
2,065 2.39
Cash Funds/Money Market Funds - (9.30%)
1,686,945 Fidelity Cash Fund Y Acc 1,709 1.98
1,709 1.98
Emerging Market Equities - (2.10%)
580,813 Artemis Global Emerging Markets Fund I Acc GBP 823 0.95
823 0.95
Forward Foreign Exchange Contracts - (0.00%)
(1,928,700) Bought GBP sold EUR @ 1.154401 for settlement 22/11/2019 10 0.01
(178,300) Bought GBP sold EUR @ 1.157461 for settlement 22/11/2019 1 0.00
(125,600) Bought GBP sold EUR @ 1.160281 for settlement 22/11/2019 0 0.00
(91,300) Bought GBP sold EUR @ 1.157236 for settlement 22/11/2019 0 0.00
(74,800) Bought GBP sold EUR @ 1.156019 for settlement 22/11/2019 0 0.00
11 0.01
Portfolio of investments 86,077 99.76
Cash and other net assets/(liabilities) 195 0.24
Net assets 86,272 100.00
The figures in brackets represent the sector distributions at 31 October 2018. Where securities are reclassified in the current period comparative percentages have been restated.The percentage of net assets disclosed above is subject to rounding.Unless otherwise stated, all holdings are on an official stock exchange listing or are permitted collective investment schemes.Where the holdings/holdings equivalent value is reported to be nil this is due to a fractional share position.
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
188
Further Information
Fidelity Investment Funds IV Registered Office
Oakhill House 130 Tonbridge Road Hildenborough Tonbridge Kent TN11 9DZ United Kingdom www.fidelity.co.uk Authorised and regulated in the UK by the Financial Conduct Authority.
Authorised Corporate Director (ACD), AIFM, General Distributor, Administrator and Registrar
FIL Investment Services (UK) Limited Oakhill House 130 Tonbridge Road Hildenborough Tonbridge Kent TN11 9DZ United Kingdom Authorised and regulated in the UK by the Financial Conduct Authority. Registered in England and Wales No 2016555.
Depositary
J.P. Morgan Europe Limited Registered Office: 25 Bank Street London E14 5JP United Kingdom
Head Office: Chaseside Bournemouth Dorset BH7 7DA United Kingdom Authorised and regulated in the UK by the Financial Conduct Authority.
Independent Auditors
PricewaterhouseCoopers LLP 7 More London Riverside London SE1 2RT United Kingdom
Fidelity Investment Funds IV Annual Report and Financial Statements for the year ended 31 October 2019
Further Information
• All Fidelity employees are subject to a Code of Ethics which, among other things, sets out procedures for personal account dealings in securities. These procedures, which are rigorously monitored, are designed to ensure that there is no conflict between personal account dealing by Fidelity staff and the interests of Fidelity’s customers. The two basics of the Code of Ethics require that deals have to be pre-authorised before an individual may undertake them, and they must afterwards be reported to the Compliance Department. Individuals are required to use specified brokers which enables this process to be checked on a continual basis. In addition, there are specific provisions to ensure that any investment idea is first acted upon by the funds Fidelity manages, and that fund managers may not deal within a defined period either side of a fund (for which they are responsible) dealing in that stock.
• The Report and Financial Statements of the Company and the Instrument of Incorporation may be inspected free of charge between 9.00 a.m. and 5.00 p.m. on every business day at the offices of the Authorised Corporate Director (ACD) at Oakhill House, 130 Tonbridge Road, Hildenborough, Tonbridge, Kent TN11 9DZ, United Kingdom.
Shareholders may obtain copies of the above documents free of charge from the same address or alternatively from our website www.fidelity.co.uk. It is possible to receive information about the full holdings of the funds in which you invest. This is available on request, and may, at our discretion, be subject to you entering into an agreement with us to keep the information confidential. If you wish to receive full holdings information in accordance with the policy, please put your request in writing to: Data Policy Fund Holdings, Oakhill House, 130 Tonbridge Road, Hildenborough, Tonbridge, Kent TN11 9DZ quoting your name, address and account number or client reference number.
• The Authorised Fund Manager (AFM) is required to conduct a detailed assessment of whether its funds provide value to investors and publish an annual statement summarising the outcome of the review. The AFM will publish the outcome of the review in a separate document available during the third quarter of 2020.
FIL Limited and its respective subsidiaries form the global investment management organisation that is commonly referred to as Fidelity International. Fidelity International only gives information on products and services and, with the exception of retirement advice, does not provide investment advice based on individual circumstances.
Any service, security, investment, fund or product outlined may not be available to or suitable for you and may not be available in your jurisdiction. It is your responsibility to ensure that any service, security, investment, fund or product outlined is available in your jurisdiction before any approach is made regarding that service, security, investment, fund or product. This document may not be reproduced or circulated without prior permission and must not be passed to private investors.
Past performance is not a reliable indicator of future results. The value of investments may go down as well as up and an investor may not get back the original amount invested. Unless otherwise stated all products are provided by Fidelity International, and all views expressed are those of Fidelity International.
In certain countries, and for certain types of investments, transaction costs are higher, and liquidity is lower than elsewhere. There may also be limited opportunities to find alternative ways of managing cash flows especially where the focus of investment is on small and medium sized firms. For funds specialising in such countries and investment types, transactions, particularly those large in size, are likely to have a greater impact on the costs of running a fund than similar transactions in larger funds. Prospective investors should bear this in mind in selecting funds.
Issued by FIL Investment Services (UK) Limited (FCA registered number 121939) a firm authorised and regulated by the Financial Conduct Authority.
FIL Investment Services (UK) Limited is a member of the Fidelity International group of companies and is registered in England and Wales under the company number 2016555. The registered office of the company is Oakhill House, 130 Tonbridge Road, Hildenborough, Tonbridge, Kent TN11 9DZ, United Kingdom. FIL Investment Management Limited VAT group identification number is 395 3090 35.
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