Rating various Fidelity pension funds

[TheMotorcycleBoy]

It does conflict with what Alaric wrote regards the inclusion of dividends but I have asked Fidelity to confirm by email how "Performance" which is stated by discrete year, and "Annualised Performance" are calculated and whether they include dividends reinvested or not.

If you are talking OEICs or equivalent, then more often than not there will be at least two classes of units. A standard designation is that "Income" or "Distribution" units show the price with dividends and other income distributed, whilst "Accumulation" units show the price inclusive of dividends etc.

To be more clear, Alaric, me and Simon are both referring to a specific Fid Pension fund claiming to be a "dividend fund". It's difficult to share that much more detail on the (damn) thing, since it's description is in a PDF which is a complete dog to copy n paste. If possible one of us could email you the .pdf file, since I'm sure you'd be a lot more knowledgeable than anyone at Fidelity who is allowed near an actual customer!!

Matt

[Mike88]

A simplistic addition to the above is that UTs trade at asset value and ITs trade more like shares at a discount or less frequently at a premium to Net Asset Value depending on supply and demand.

Thanks for this Mike,

So to clarify when we talk of the NAV of an IT's unit, is it the share price of all of the individual holdings that comprise the NAV....as opposed to the NAV meaning the actual assets of the firms (i.e. their tangible and intangible assets on their balance sheets)?

So as an example if an IT is has a 33% contribution from a firm A, 33% from firm B, 33% from firm C, and the share prices of these 3 are =

A=£2
B=£3
C=£4

Then the NAV of this IT is £3......is that correct? And if it was trading at £2.70 then we would say that this is at a 10% discount to NAV....is that about right?

thanks
Matt

In simplistic terms NAV is calculated on the basis of the relative share prices of the constituent holdings and your example of trading at a discount is correct. Thus the share price of an IT is influenced not only by the value of the underlying assets but also by a widening or narrowing of the discount. Of course some ITs trade at a premium and in such circumstance it is cheaper (initially at least) to buy the UT equivalent.

[StepOne]

I'm pretty sure the performance figures will include dividends - whether accumulated or paid out.

Looking at the KIIDs for the Fidelity Moneybuilder Dividend funds they have a performance graph which compares against the FTSE-100 TR (Total Return) index, which definitely includes dividends.

StepOne

[Alaric]

To be more clear, Alaric, me and Simon are both referring to a specific Fid Pension fund claiming to be a "dividend fund".

It has the word "dividend" in its title. I don't think you should interpret this to mean any more than that it invests in Companies that pay dividends and beyond that you need to know whether the class of unit is "Income" or "Accumulation".

[TheMotorcycleBoy]

Thanks everyone,

To be honest, I'm not actually thinking selecting the Fidelity MoneyBuilder Dividend Pensions Fund into my current pensions scheme (I believe it had a higher than average charge). I just happened upon it whilst reviewing all the various funds on offer by Fidelity.

Anyway, I do still have one more question to ask you people for advice. It's probably a silly one, so go easy on me.

I'm considering making fund allocation changes to my current works DC scheme, which is currently 100% in the my company's default fund which according to Fid is called:

FIDELITY DIVERSIFIED MARKETS FUND (LACQ) (I think it's a combination of global equities, bonds, gilts, defensive, e.g. property and cash)

A whole load of my colleagues for the past several months or so have expressed poor views on it's performance, and I'm inclined to agree. I'm thinking of moving 75% of my holdings split 3 ways into other funds, which are higher risk/return.

Is right now a silly time to do make any pension fund transfers, what with recent market sell offs?

Or will it not make much difference as although I'll be selling low, I'll also probably be buying low too when my provider transfers the units of the existing funds into different funds?