FidelityConnects

As the economic cycle continues to shift from early cycle into mid cycle, investors look for market direction from the head of Quantitative Index Solutions, Bobby Barnes. According to Bobby, stocks such as retail and airlines are finally starting to rise, and as a result, we can see positive trends in the market. He notes, the main catalyst behind this positive movement is the reopening of economies and value investing. Bobby also emphasizes the impact of value and momentum investing as we enter a new economic cycle. Leveraging quality stocks would also be beneficial as we will continue to see periods of accelerated growth. Bobby also believes in the power of Just-In-Time, an innovative inventory solution to the rising supply and demand concern. Finally, Bobby comments on the rapid growth behind cryptocurrency, but notes because it is still new it can be hard to predict how companies will ensure consistent profitability.

Recorded on November 5, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_barnes_5nov.pdf

Fidelity’s Director of Global Macro, Jurrien Timmer, starts off today’s show touching upon equities, the United States Federal Reserve, and emerging markets. Jurrien remarked that there is always a concern about corrections in bull markets and notes that the market is now up 110% from its bottom in March 2020. He also notes that he is seeing strong earnings especially with the S&P 500 profit margin which is now at an all-time high of 14%, which he believes demonstrates a much faster recovery than anticipated. In terms of the United States Federal Reserve tapering, Jurrien shares that the bond market tapering is starting this month, but the market is not reflecting an expectation of a neutral policy, which he expects may lead us into a period similar to the 1940s with the Fed accepting higher structural inflation as collateral for a healthy economy. When asked about his response to fears of a market crash if the Fed stops being so accommodative, Jurrien indicates that market internals are improving quite a bit, and instead of fretting about slight downturns, he said to remember that even though markets go down 40% of the time, we still see compounded annual growth at 11%, and that’s where he believes staying invested carries a prize. Lastly, Jurrien believes that we are not going to see outperformance in emerging markets (EM) or Europe, Australasia, and the Far East (EAFE) without a relative earnings story to back it up, also noting that these regions are now showing negative earnings momentum.

Recorded on November 8, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_webcast_timmer_08nov.pdf

Denise Chisholm, Director of Quantitative Market Strategy, joins us today. The topic of the day is disruption, and how investing in disruption can give investors exposure to groundbreaking companies. From industrial robotics and artificial intelligence to cloud computing and autonomous vehicles, disruption can be found in many areas of the economy. What industries and sectors are being disrupted today, and how could these innovations shape the next decade? Fidelity Canada recently launched two funds to capture this market momentum – Fidelity Disruptors™ Class and Fidelity Disruptive™ Automation Class. With host Pamela Ritchie, Denise breaks down using sectors and factors as building blocks of a portfolio, shares her perspectives on the current economy, and highlights what areas of the market she is strategically paying attention to as we head towards the end of 2021.

Recorded on November 4, 2021.

Hugo Lavallée, portfolio manager of Fidelity Climate Leadership Fund, Greater Canada Fund, and Canadian Opportunities Fund joins us today for an update on his funds, his contrarian investment strategy, and to unpack the accelerating trend of decarbonization and combating climate change. Hugo’s Climate Leadership Fund, which was launched in May 2021, aims to achieve long-term capital growth by investing in companies that are believed to be climate leaders, climate solutions providers and climate reformers. This is an idea Hugo has been working on for a few years and he is proud of the traction and interest in his fund so far. This pairs with the acceleration of global commitments to becoming carbon neutral: changing corporate behaviours, changing consumer behaviours, and the recent climate commitments discussed at the 2021 United Nations Climate Change Conference, which Hugo also reflects on today. Hugo also looks at electric vehicles and the EV substitution accelerating, at home solar panels, and the similarities, differences and performance of the two funds Hugo has managed over a longer time period – Greater Canada and Canadian Opportunities.

Recorded on November 3, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_webcast_lavallee_03nov.pdf

Portfolio manager Kyle Weaver joins the show today for a look at the U.S. equities investment landscape as we head towards the end of 2021. For Canadian investors, Kyle manages Fidelity U.S. Growth Opportunities Class and is a co-portfolio manager on Fidelity NorthStar® Fund alongside Joel Tillinghast and Dan Dupont. Kyle shares how he is a growth manager who believes in deep value, and focuses on finding the undiscovered future blue-chip companies. Additionally, long-term growers and resilient growers who will prove to be very cheap on a three to seven year view are Kyle’s ideal investments. Today in speaking with host Pamela Ritchie, Kyle shares he is finding value-based care and healthcare a promising area. Also, Kyle is looking at companies that combine e-commerce and brick & mortar together, sharing that companies that allow the consumer to buy online and pick-up in store, and do it well, are becoming people pleasers. Kyle shares he is seeing some powerful macro factors currently, but doesn’t get caught up in macro and remains focused on stock-picking. He looks at what's just short term noise and what may be here to stay, while noting he aims to take advantage of this noise while remaining a disciplined investor.

Recorded on November 2, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_weaver_2nov.pdf

Eileen Dibb, portfolio manager of Fidelity AsiaStar® Fund and Fidelity Japan Fund, is featured on this episode discussing Asia-Pacific equity opportunities. Eileen provides a market update, revolving heavily around vaccines and the reopening of countries. Within this episode, Eileen provides her thoughts on outside investor preferences and the deciding factors as to why they choose one country over the other. Additionally, Eileen discusses China’s policy changes and their impact on the stock markets. The topic of healthcare in China was also highlighted and how it has become an area of focus, predominately within biopharmaceuticals. Eileen provides further detail and describes a variety of key features and benefits of Fidelity AsiaStar® Fund. Finally, Eileen discusses housing and the certain aspects that will continue to impact it moving forward.

Recorded on October 28, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_dibb_28octpdf

Jurrien Timmer, Director of Global Macro joins us today for his global macro update, and will speak on two reoccurring themes: inflation, and supply and demand. Jurrien believes we are in a commodity super cycle and as a result there remains a large emphasis on the energy equity sector. Historically, energy commodities have had a positive correlation with inflation. Therefore, Jurrien believes we’ll continue to see this sector grow. Jurrien also shares his thoughts on the pieces of inflation that are related to the supply chain, he believes a resolution is near as companies remain adamant on delivering product to their consumers. Additionally, Jurrien comments on the Canadian Dollar making a connection between positive trends in commodity currencies when strong commodity influence is present in the market. Visit @TimmerFidelity on Twitter to follow along with some charts.

Recorded on November 1, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_timmer_1nov.pdf

Portfolio manager David Tulk joins us today to look at the impacts of rising inflation, unpack the recent moves by global central banks, and to help us look beyond the headlines. David unpacks the October 27th Bank of Canada announcement to end the Quantitative Easing bond buying program. He also explores the recent bond market action, describing a push and pull tug of war between how central banks are conducting policy and how the bond market is interpreting what central banks are saying. Host Pamela Ritchie also asks David about the Canadian dollar, housing, consumer debt, and how inflation pressures could change how investors look at a traditional 60/40 portfolio. David and the Global Asset Allocation team manage several funds for Canadian investors, including the new Fidelity Inflation-Focused Fund. This fund aims to invest in securities collectively resilient to inflation, an optimized balance between various inflation-focused asset classes in a single strategy.

Recorded on October 28, 2021.

This edition of FidelityConnects features David Way, Portfolio Manager of Fidelity Long/Short Alternative Fund. This fund, which launched in October 2020, has an investment philosophy anchored in the belief that skilled active management can consistently identify attractive investment opportunities through the economic cycle. This is achieved through three key philosophies: finding the change before the change, harvesting superior industry/company analysis and style-agnostic stock picking. David discusses the breakdown of Fidelity Long/Short Alternative Fund, how it may fit in one’s portfolio, and dives into further detail on the diversification opportunities presented by the “short” side of the fund. Also, David looks at opportunities in effective supply chains, a normalizing economy, transitions in technology and energy, and the impact of stimulus on today’s economy.

Recorded on October 27, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_way_27oct.pdf

Charlie Hebard and Michael Kim, portfolio managers on Fidelity Disruption™ Funds, and Denise Chisholm, Director of Quantitative Market Strategy, join us today to share their approach to thematic and disruption investing. Charlie believes that disruption is happening all around us and defines their strategy as investing in companies that have the potential to disrupt industries, whether that is through legacy companies or new companies that have the ability to change the landscape in that industry. According to Charlie, there are five themes that the team identified for Fidelity Disruption™ Funds and they are Technology, Communications, Medicine, Automation, and Finance. Denise expresses that themes, sectors, and factors are the building blocks to investing, where themes are grouping companies together based on underlying drivers. Michael feels that the markets have been choppy over the past year, and for Fidelity Disruption™ Funds, they are focused on a long-term investment thesis of each company, not expecting them to be disruptors during the next year but later on in each company’s life cycle. Michael says that there will be more volatility in these companies which they will take advantage of when prices are low, and his job is to try and smooth this volatility across the fund. At the moment, the team is not investing in private companies but is open to investing in companies that have recently gone public if they feel there is a potential for rapid growth over time.

Recorded on October 26, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_hebard_kim_chisholm_oct26.pdf