Fidelity adds to the Moneybuilder range
Fidelity International has enhanced its MoneyBuilder range with the addition of its Fidelity Income Plus Fund which will be renamed Fidelity MoneyBuilder Dividend Fund from 28th September.
The MoneyBuilder range offers funds with no initial charge and low annual management fees and includes MoneyBuilder Income, a fixed income fund, and MoneyBuilder Growth Fund, which invests in UK equities.
The MoneyBuilder Dividend fund will continue to be managed by Michael Clark whose fund has been top of the IMA UK Equity Income sector for 2011 year to date. The fund will continue to invest in companies that can consistently deliver dividend growth as he believes they will provide strong outperformance over the long term.
Gary Shaughnessy, UK Managing Director, Fidelity International, comments: "Many investors underestimate the importance of dividends to the growth potential of their investments. Reinvesting the dividends from investments can make a significant difference to capital returns thanks to compounding. By changing the name of the fund to MoneyBuilder Dividend we are highlighting the significance of dividends in the performance of equities and their importance to investors as a source of income. Bringing the fund under the MoneyBuilder banner will also reiterate Fidelity's commitment to providing a good value range of funds that investors can base their portfolio around."
Recent volatile markets have highlighted the case for equities as a source for income. Buying high-yielding stocks at market lows provides investors with a double win, they lock in a high income return on their initial investment and benefit from a higher than average capital return as well.
Fund manager Michael Clark comments: "I am confident that my approach can continue to provide good returns, particularly given the challenging economic backdrop facing the UK. Moreover, equities are relatively cheap right now as sentiment has become depressed due to macroeconomic concerns.
"Many large cap stocks in particular are offering decent income returns and good value at current valuations. The dividend yields of many of the companies I invest in are at a comparable level to their long term corporate bonds, a situation that historically has rarely lasted for long. The equities of GlaxoSmithKline, National Grid and Imperial Tobacco are all yielding above their corporate bond yields."
The addition of MoneyBuilder Dividend further strengthens the MoneyBuilder range as a competitively-priced core holding for retail investors. In line with the MoneyBuilder range, the initial charge on the fund will now be 0%. The annual management charge will be 1%. Minimum investment is £500 or £50 via a monthly savings plan. The investment objective and performance benchmark will remain the same.