Fidelity Future Leaders Fund

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About this Fund

Fund Detail

PDS https://informedinvestor.com.au/view/pds/100041-2023-07-28-10:46.pdf
FUND MANAGER Fidelity International
ASX Code
INVESTMENT STYLE The Fund invests in mid- and small-cap Australian companies.
INVESTMENT PROFILE To achieve returns in excess of the Benchmark over the suggested minimum investment time period of five to seven years.
FUND SIZE S&P/ASX Mid Small Index
FEES 1.20% p.a. of the net asset value of the Fund (including GST net of Reduced Input Tax Credit)



Benefits of investing in the Fidelity Future Leaders Fund

Some of the benefits that may arise from an investment in the Fund include:

  • Potential for long-term capital growth and enhanced performance from active management.
  • Potential to earn higher returns than the Fund's benchmark, the S&P/ASX Mid Small Index.
  • Access to the investment knowledge and expertise of Fidelity's global network of investment professionals who can assess Australian companies in a global context.
  • Access to a portfolio of shares that may provide regular income distributions.

Risk level

Very High

Investor suitability

Investors looking for a mid- to small-cap Australian equities investment who have a tolerance for a very high amount of risk.




Key Features

Fund description

The Fund provides investors with the potential for long-term capital growth by investing in a portfolio of listed mid- and small-cap Australian shares. It delivers significant diversification benefits by investing in 40 to 70 Australian companies.

Fidelity believes that markets are semi-efficient and share prices don't always reflect inherent value. Through in-house, bottom-up company research, Fidelity aims to uncover the opportunities that we believe offer the greatest scope for outperformance.

What will we invest your money in?

The Fund may invest in a variety of shares, derivatives and cash. The Fund's investments will comprise between 90% to 100% of Australian shares, with the remaining amount invested in cash. Decisions to invest cash will be dependent upon the availability of other favourable investment opportunities.

Why invest?

  • Access to Australian large- caps of tomorrow, today
  • An actively managed portfolio of 40 to 70 small- to mid-cap Australian shares
  • Offers investors a unique approach to portfolio construction which aims to deliver consistent returns through different market cycles

The Fidelity difference

Established in 1969, Fidelity International offers world- class investment solutions and retirement expertise. As a privately owned, independent company, investment is our only business and we're driven by the needs of our clients, not by shareholders. Our vision is to deliver innovative client solutions for a better future.

We're an active manager focused on global research, and have one of the largest buy side research teams in the world. It's our obsession with research, with insights globally and locally, which enable us to evaluate complex businesses and make better investment decisions for our clients.


How we invest your money

Investment approach

Screening the universe through intensive research

The portfolio manager (PM) uses company visits and the investment insights of our Australian and global analysts when screening the universe of around 250 Australian mid- and small-cap stocks.

Rigorous assessment and scoring for key characteristics

A more detailed analysis is conducted on around 100 investable stocks. The PM will focus on identifying stocks that have:

  • Viability - pricing power, strong opportunities and rising return on equity
  • Sustainability - a strong industry position and the ability to generate cash flow to fund growth and withstand competitive pressures
  • Credibility - strong conviction in the quality of the business and management

The PM assigns stocks a score out of 10 for each of these characteristics. The final portfolio is typically overweight companies that demonstrate stronger-than-average viability, sustainability and credibility.

Stock selection

Final stock selection decisions are made by the PM, where 40 to 70 stocks are picked for the portfolio. Valuation metrics are a key driver in this stage, with stocks assigned to one of four segments: quality, momentum, transition and value.

The PM believes a portfolio containing a balance of stocks across these four segments will deliver more consistent returns through different market cycles.


Every 120 days we review the companies that have stock in the Fund. If things change, we can react quickly.

Asset classes and ranges

  • Australian shares: 90% to 100%
  • Cash: 0% to 10%

The Fund may invest in listed Australian shares outside the S&P/ASX Mid Small Index (the S&P/ASX 300 excluding the S&P/ASX 50), to a maximum of 10% of the Fund's assets by value with the exception of listed Australian shares in the S&P/ASX 50. In the case where shares move into the S&P/ASX 50 post purchase, they will be sold within a reasonable timeframe and the Fund's portfolio will be rebalanced.


We may make use of derivatives, such as futures contracts and swaps. A derivative is a security whose price or value is dependent upon or derived from an underlying instrument (such as shares, indices, interest rates, fixed income securities, commodities, currencies, etc). A derivative contract is a contract between two or more parties and its value is determined by fluctuations in the underlying asset. Generally, derivatives will be used for cash flow management purposes within the Fund. Any derivative exposure must be fully covered by cash or assets sufficient to meet any obligation that could arise. If derivatives are used, they will comprise a small portion of the Fund's assets.