6th Oct 2025 08:57
(Alliance News) - Fidelity Emerging Markets Ltd on Monday said its "outperformance" could continue "well into the future", as it lifted its final dividend for 2025.
The investment fund targets high-growth emerging markets in Africa, South Asia, South America and Europe.
FEM posted a net asset value of USD11.99 per participating preferential share at June 30, up from USD10.09 a year earlier.
NAV total return was 11.8% during the year that ended June 30, lower than the previous year's 18.7% rate. Nonetheless, this beat the firm's benchmark, the MSCI Emerging Markets index, which reported a 6.3% return.
FEM raised its final dividend to 26 US cents from 20 cents in financial 2024.
Its shares rose 1.7% to 984.00 pence on Monday morning in London, having advanced 41% in the last 12 months.
The firm suggested that a rise in trade between emerging market economies had partially shielded its portfolio from tariff uncertainty.
"Although US tariffs remain a prominent headline issue, a rise in intra-EM trade has lessened the importance of exports to the US for most emerging markets. From a peak of almost 80% of EM exports flowing into developed markets in the early 1990s, the balance is now close to 50:50 between emerging and developed markets, with the US accounting for less than 20%," FEM said, citing FactSet and Morgan Stanley Research.
"Away from the tariff tribulations, there are many other factors to commend emerging markets: positive demographic trends, with (in most cases) young and increasingly educated populations, under-penetrated markets for goods and services, and a degree of fiscal rectitude largely lacking in the larger developed economies. Coupled with low valuations and signs of greater investor attention, your board and portfolio managers believe the outperformance of the past two years could potentially extend well into the future," the firm added.
By Holly Munks, Alliance News reporter
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