* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Download Fidelity Convertible Securities Investment Trust
International investment agreement wikipedia , lookup
Leveraged buyout wikipedia , lookup
Stock trader wikipedia , lookup
Private equity in the 2000s wikipedia , lookup
Private equity wikipedia , lookup
Corporate venture capital wikipedia , lookup
Auction rate security wikipedia , lookup
Securitization wikipedia , lookup
History of investment banking in the United States wikipedia , lookup
Securities fraud wikipedia , lookup
Mark-to-market accounting wikipedia , lookup
Security (finance) wikipedia , lookup
Investment banking wikipedia , lookup
Early history of private equity wikipedia , lookup
Environmental, social and corporate governance wikipedia , lookup
Private money investing wikipedia , lookup
Money market fund wikipedia , lookup
Socially responsible investing wikipedia , lookup
Private equity secondary market wikipedia , lookup
Mutual fund wikipedia , lookup
Fidelity Convertible Securities Investment Trust Semi-Annual Management Report of Fund Performance December 31, 2016 Caution Regarding Forward-looking Statements Certain portions of this report, including, but not limited to, “Results of Operations” and “Recent Developments”, may contain forward-looking statements about the Fund, including its strategy, risks, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future Fund action, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Fund and economic factors. Accordingly, assumptions concerning future economic and other factors may prove to be incorrect at a future date. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made by the Fund. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. It should be stressed that the above-mentioned list of important factors is not exhaustive. You are encouraged to consider these and other factors carefully before making any investment decisions and you are urged to avoid placing undue reliance on forward-looking statements. Further, you should be aware of the fact that the Fund has no specific intention of updating any forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Report of Fund Performance. Semi-Annual Management Report of Fund Performance as at December 31, 2016 Fidelity Convertible Securities Investment Trust This semi-annual management report of fund performance contains financial highlights but does not contain the complete semi-annual financial statements for the investment fund. You can get a copy of the semi-annual financial statements at your request, and at no cost, by calling 1-800-263-4077, by writing to us at Fidelity Investments, 483 Bay St. Suite 300, Toronto ON M5G 2N7 or by visiting our website at www.fidelity.ca or SEDAR at www.sedar.com. Security holders may also contact us using one of these methods to request a copy of the investment fund’s proxy voting policies and procedures, proxy voting disclosure record or quarterly portfolio disclosure relating to the investment fund. Management Discussion of Fund Performance Results of Operations Units of this Fund are only available for purchase by other funds and accounts managed or advised by Fidelity and are not available for public purchase. Fidelity Convertible Securities Investment Trust (Fund), Series O, returned 10.6% for the six-month period ended December 31, 2016, after fees and expenses. The Bloomberg Barclays U.S. Aggregate Bond Index, broadly representative of U.S. investment-grade bonds, returned 0.7% for the six-month period ended December 31, 2016. Market Overview: U.S. fixed-income markets registered positive returns amid improved investor sentiment in the U.S., accommodative monetary policies from global central banks and the stabilization of commodity prices. A stronger labour market, increased government spending and robust consumption also helped the U.S. economy. However, optimism regarding the President-elect’s fiscal policies, which were generally viewed as positive for equity markets, did not support the bond markets toward the end of the review period. Additionally, U.S. bond markets weakened in a risinginterest-rate environment. The U.S. Federal Reserve increased its key interest rate in December by 25 basis points to 0.75%. The convertible securities market performed strongly, with demand for most risk assets increasing in anticipation of improved corporate earnings, given prospects of decreased regulation, positive tax reform and increased fiscal spending in the U.S. The broad-based Bloomberg Barclays U.S. Aggregate Bond Index is a market value-weighted performance benchmark for U.S. investment-grade fixed-rate debt issues, including government, corporate, asset-backed and mortgage-backed securities with maturities of at least one year. In contrast, the Fund invests primarily in convertible securities in the U.S. Factors Affecting Performance: The Fund’s benchmark, the BofA Merrill Lynch All U.S. Convertibles Index, returned 11.8% for the same period (in Canadian dollar terms). The Fund underperformed its benchmark due to investments in the information technology and health care sectors. Having lower-than-benchmark exposure to visual computing company NVIDIA detracted from relative performance. In the health care sector, exposure to Envision Healthcare and Teva Pharmaceuticals detracted from relative performance. Exposure to utility company Dynegy also detracted from relative returns. Conversely, exposure to Peabody Energy contributed to relative returns; however, the security was not held in the portfolio at the end of the review period. Exposure to technology hardware and equipment company Interdigital, which develops wireless technologies for mobile devices, networks, and services, also contributed to relative returns. Portfolio Changes: During the review period, portfolio manager Adam Kramer increased the Fund’s exposures to the energy and consumer discretionary sectors, where he found investment opportunities at attractive valuations. In contrast, the Fund’s exposures to the health care and information technology sectors were reduced; the manager found better relative value opportunities in other sectors. As at the end of the review period, the Fund’s largest absolute exposure was to the health care sector, followed by the financials sector. Recent Developments Portfolio manager Adam Kramer is positive on the overall convertible securities market, with the U.S. economy continuing to grow at a gradual pace. He believes there is enough supply at attractive valuations in the market, and that the U.S. Federal Reserve’s interest rate hikes should bode well for the asset class as investors begin to seek higher-yielding assets. In the long run, the manager believes the convertible securities market may offer an attractive risk/reward profile, given its defensive equity characteristics: current income with typically lower volatility than the equity markets. 1 Related Party Transactions Manager and Portfolio Adviser The Fund is managed by Fidelity Investments Canada ULC (Fidelity). Fidelity is part of a broader group of companies collectively known as Fidelity Investments. Fidelity provides or arranges for the provision of all general management and administrative services required by the Fund in its day–to–day operations, bookkeeping, record–keeping and other administrative services for the Fund. Fidelity is the portfolio adviser to the Fund. Fidelity has entered into sub-advisory agreements with a number of entities including FMR Co., Inc., to provide investment advice with respect to all or a portion of the investments of the Fund. The sub-advisors arrange for acquisition and disposition of portfolio investments, including all necessary brokerage arrangements. The Fund pays Fidelity a monthly management and advisory fee for their services, based on the net asset value of each Series, calculated daily and payable monthly. The Fund paid Fidelity management and advisory fees of less than $500 for the period ended December 31, 2016. Brokerage Commissions The Fund may place a portion of its portfolio transactions with brokerage firms which are affiliates of Fidelity Investments, including National Financial Services LLC, provided it determines that these affiliates’ trade execution abilities and costs are comparable to those of non–affiliated, qualified brokerage firms, on an execution–only basis. Commissions paid to brokerage firms that are affiliates of Fidelity Investments were $3,000 for the period ended December 31, 2016. Fidelity receives standing instructions from the IRC in respect of policies and procedures governing best execution of transactions with affiliates, which includes brokers affiliated to Fidelity Investments, at least once per year. 2 Financial Highlights The following tables show selected key financial information about the Fund and are intended to help you understand the Fund’s financial performance for the period end of the years shown. This information is derived from the Fund’s audited annual and/or unaudited semi-annual financial statements. Please see the front page for information about how you can obtain the Fund’s annual or semi-annual financial statements. Fidelity Convertible Securities Investment Trust Series O Six-months ended December 31, The Series’ Net Assets per Security B Net assets, beginning of period C Increase (decrease) from operations: Total revenue Total expenses (excluding distributions) Realized gains (losses) Unrealized gains (losses) Total increase (decrease) from operationsC Distributions: From net investment income (excluding dividends) From dividends From capital gains Return of capital Total distributionsC,D Net assets, end of periodC Ratios and Supplemental Data Net asset value (000s) E Securities outstandingE Management expense ratio F Management expense ratio before waivers or absorptions F Trading expense ratioG Portfolio turnover rateH Net asset value per security, end of period Periods ended June 30, 2016 2016 2015 2014 2013 2012A $12.0861 $13.3410 $13.1823 $12.0094 $10.0772 $10.0000 .0775 .4719 .1990 .0835 .0454 (.0314) (.0153) .3537 .8478 (.0343) .1039 (.2181) (.0277) 2.8512 (1.2929) (.0022) 2.0838 .3471 – .7861 1.5509 – .1794 .1493 1.2637 .3234 1.7296 2.5122 2.3824 .2973 (.1982) (.0006) (.3920) – (.5908) $12.7732 (.4891) (.0011) (1.1244) – (1.6146) $12.0861 (.4543) – (1.1520) – (1.6063) $13.3410 (.3899) – (.9222) – (1.3121) $13.1823 (.3573) – (.0726) – (.4299) $12.0023 (.1797) – – – (.1797) $10.0772 $1,417,337 110,909,931 –% $1,226,307 102,296,838 –% $1,189,137 89,806,358 –% $1,533,471 117,218,910 —% $1,049,081 87,354,964 —% $806,358 80,008,659 —% —% .02% 49.30% —% .02% 100.36% —% .01% 84.00% —% —% 74.61% —% .01% 87.43% —% .01% 76.58% $12.7728 $12.0862 $13.3412 $13.1823 $12.0094 $10.0784 A For the period December 1, 2011 (inception date) to June 30, 2012. B This information is derived from the Fund’s audited annual and/or unaudited interim financial statements. Periods beginning on or after January 1, 2013 follow International Financial Reporting Standards (IFRS) and periods prior to January 1, 2013 follow Canadian Generally Accepted Accounting Principles (Canadian GAAP). The net assets attributable to holders of redeemable securities per security presented in the financial statements may differ from the net asset value calculated for fund pricing purposes. An explanation of these differences can be found in the notes to financial statements. C Net assets and distributions are based on the actual number of securities outstanding at the relevant time. The increase (decrease) from operations is based on the weighted average number of securities outstanding over the financial period. This table is not intended to be a reconciliation of beginning to ending net assets per security. D Distributions were paid in cash or reinvested in additional securities of the Fund, or both. Distributions are presented based on management’s best estimate of the tax character. E This information is provided as at period end of the year shown. F No fees are charged to the Series. G The trading expense ratio represents total commissions and other portfolio transaction costs expressed as an annualized percentage of daily average net asset value during the period, including the Fund’s pro-rata share of estimated trading costs incurred in any underlying investment fund, if applicable. H The Fund’s portfolio turnover rate indicates how actively the Fund’s portfolio adviser manages its portfolio investments. A portfolio turnover rate of 100% is equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the year. The higher the Fund’s portfolio turnover rate in a year, the greater the trading costs payable by the Fund in the year, and the greater chance of an investor receiving taxable capital gains in the year. There is not necessarily a relationship between a high portfolio turnover rate and the performance of the Fund. The portfolio turnover rate is calculated based on the lesser of purchases or sales of securities divided by the weighted average market value of the portfolio securities, excluding short-term securities. For periods greater than six months, but less than a full fiscal year, the portfolio turnover rate is annualized. 3 Fidelity Convertible Securities Investment Trust Past Performance The performance information shown assumes that all distributions made by the Fund in the periods shown were reinvested in additional securities of the Fund. The performance information does not take into account sales, redemption, distribution or other optional charges that would have reduced returns or performance. How the Fund has performed in the past does not necessarily indicate how it will perform in the future. Year-by-Year Returns The following bar chart shows the Fund’s annual performance for each of the years shown, and illustrates how the Fund’s performance was changed from year to year. In percentage terms, the bar chart shows how much an investment made on the first day of each financial year would have grown or decreased by the last day of each financial year. For each Series in the Year-by-Year Returns table below, the most recent returns stated are for the current six month period. Series O Fiscal Years Percentage (%) 30 20 10 0 -10 Commencement of Operations is January 27, 2012 4 2012 2013 2014 2015 2016 2016 2.6 23.9 21.7 14.3 2.6 10.6 Fidelity Convertible Securities Investment Trust Summary of Investment Portfolio as at December 31, 2016 Asset Mix as of December 31, 2016 Quality Diversification as of December 31, 2016 % of Fund’s Net Assets % of Fund’s Net Assets Foreign Bonds 56.2 A Foreign Equities 32.5 BBB 3.0 2.4 Foreign Preferred Securities 1.5 BB and Below 34.3 Canadian Bonds 1.0 Not Rated 19.0 Cash and Cash Equivalents 8.1 Equities 32.5 Net Other Assets (Liabilities) 0.7 Short-Term Investments and Net Other Assets Sector Mix as of December 31, 2016 % of Fund’s Net Assets Health Care 8.2 Financials 5.9 Consumer Staples 4.9 Energy 3.4 Utilities 3.0 Telecommunication Services 2.7 Industrials 2.6 Information Technology 1.8 Consumer Discretionary 1.0 Others (Individually Less Than 1%) 0.5 Foreign Bonds 56.2 Canadian Bonds 1.0 Cash and Cash Equivalents 8.1 Net Other Assets (Liabilities) 0.7 Geographic Mix as of December 31, 2016 % of Fund’s Net Assets United States of America 78.8 Bermuda 3.9 Ireland 2.9 Marshall Islands 2.0 Netherlands 1.0 Canada 1.0 Others (Individually Less Than 1%) 1.6 Cash and Cash Equivalents 8.1 Net Other Assets (Liabilities) 0.7 Maturity Diversification as of December 31, 2016 Years % of Fund’s Net Assets 0 – 1 1.0 1 – 3 13.4 3 – 5 13.5 Over 5 29.3 8.8 We have used ratings from Moody’s Investors Service, Inc. Where Moody’s® ratings are not available, we have used S&P® ratings. All ratings are as of the date indicated and do not reflect subsequent changes. Top 25 Issuers % of Fund’s Net Assets 1. Cash and Cash Equivalents 8.1 2. Twitter, Inc. * 4.1 3. DISH Network Corp. * 3.2 4. InterDigital, Inc. * 3.2 5. Wells Fargo & Co. 3.1 6. Allergan PLC 2.9 7. Micron Technology, Inc. * 2.5 8. T-Mobile U.S., Inc. 2.3 9. Liberty Media Corp. * 2.3 10. Bank of America Corp. 2.3 11. Brocade Communications Systems, Inc. * 2.2 12. CenterPoint Energy, Inc. 2.2 13. Anthem, Inc. 2.0 14. Post Holdings, Inc. 2.0 15. Scorpio Tankers, Inc. * 2.0 16. Chesapeake Energy Corp. * 1.9 17. VeriSign Inc * 1.9 18. Envision Healthcare Corp. 1.7 19. Salesforce.com, Inc. * 1.6 20. AMAG Pharmaceuticals, Inc. * 1.5 21. General Electric Co. 1.5 22. Intel Corp. * 1.5 23. Southwestern Energy Co. 1.4 24. Bunge Ltd. 1.4 25. Weatherford International Ltd. * 1.3 60.1 * Equity Issuer Total Fund Net Assets $1,416,680,000 5 Summary of Investment Portfolio as at December 31, 2016 – continued The summary of investment portfolio may change due to ongoing portfolio transactions of the investment fund. The most recent annual report, semi-annual report, quarterly report, fund facts document or simplified prospectus for the investment fund and/or underlying fund is available at no cost, by calling 1-800-263-4077, by writing to us at Fidelity Investments Canada ULC, 483 Bay St. Suite 300, Toronto ON M5G 2N7 or by visiting our web site at www.fidelity.ca or SEDAR at www.sedar.com. 6 Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Manager, Transfer Agent and Registrar Fidelity Investments Canada ULC 483 Bay Street, Suite 300 Toronto, Ontario M5G 2N7 Custodian State Street Trust Company of Canada Toronto, Ontario Portfolio Adviser Fidelity Investments Canada ULC Toronto, Ontario Visit us online at www.fidelity.ca or call Fidelity Client Services at 1-800-263-4077 Fidelity’s mutual funds are sold by registered Investment Professionals. Each Fund has a simplified prospectus, which contains important information on the Fund, including its investment objective, purchase options, and applicable charges. Please obtain a copy of the prospectus, read it carefully, and consult your Investment Professional before investing. As with any investment, there are risks to investing in mutual funds. There is no assurance that any Fund will achieve its investment objective, and its net asset value, yield, and investment return will fluctuate from time to time with market conditions. Investors may experience a gain or loss when they sell their securities in any Fidelity Fund. Fidelity Global Funds may be more volatile than other Fidelity Funds as they concentrate investments in one sector and in fewer issuers; no single Fund is intended to be a complete diversified investment program. Past performance is no assurance or indicator of future returns. There is no assurance that either Fidelity Canadian Money Market Fund or Fidelity U.S. Money Market Fund will be able to maintain its net asset value at a constant amount. The breakdown of Fund investments is presented to illustrate the way in which a Fund may invest, and may not be representative of a Fund’s current or future investments. A Fund’s investments may change at any time. ® Fidelity Investments is a registered trademark of FMR LLC. 62.110828E 1.945039.104 FICL-FCCONV-MRFPS-0217