FIDELITY EUROPEAN VALUES PLC SEEKING GROWTH AT A REASONABLE PRICE FIDELITY INVESTMENT TRUSTS 31 JULY 2013 FIDELITY EUROPEAN VALUES PLC DETAILS TO 31.07.13 Share price: NAV: NAV (excluding income): Discount: Discount (excluding income): Gearing: Ordinary shares in issue: Launch date: Portfolio Manager: Appointed to trust: Years at Fidelity: 1485.00p 1680.98p 1648.90p 11.66% 9.94% 7.79% 42,266,639 05/11/1991 Samuel Morse 01/01/2011 9 Fidelity European Values PLC aims to achieve long term capital growth from a portfolio primarily made up of shares in continental European companies. The portfolio manager is not restricted in terms of market cap, country or sector allocation which is determined by the location of attractive investment opportunities rather than the outlook for each market. European equities, resumed its uptrend after taking a brief pause in May, as European Central Bank (ECB) President Mario Draghi said that interest rates will remain low for an extended period of time or may even be reduced further. The market was also supported by signs that the US Federal Reserve may maintain its monetary stimulus for a little longer than expected. There is much debate about the recent rise in bond yields. This can be an inflection point, following a very long (more than three decades) decline in bond yields, signalling the beginning of a new era, in which the global economy, led by the US, shakes off the shackles of the financial crisis and returns to a more normal rate of growth. However, this is not certain and bond yields may sink again when it becomes apparent that it is too soon, and the economy is still too fragile, for the Federal Reserve to start “tapering” quantitative easing. Only time will tell. China’s rate of growth appears to be slowing as the government focuses more on the quality and sustainability of growth rather than just the volume of growth. Most notably, commodity prices have been weak, reflecting a slower pace in Chinese demand and a lagged supply response. This is good news for inflation expectations but may lead to further weakness in the new BRIC motors of the global economy. The abundance of liquidity, as a result of low interest rates and quantitative easing, has encouraged investment strategies that have dictated market movements, perhaps to excess, over many years. For instance, the “carry trade” of borrowing in dollars to buy higher-yielding assets, often emerging market assets, may now reverse. It will be a fluid environment but the manager’s focus will continue to be on attractively-valued companies, with sound balancesheets, which can deliver consistent dividend growth. In July, the Trust recorded NAV returns of 6.9%, underperforming the index which returned 7.7%. Updated July 2013 Sam Morse, Portfolio Manager PORTFOLIO MANAGER FIVE YEAR PERFORMANCE COMPARISON 06-08 12-08 06-09 12-09 06-10 12-10 06-11 12-11 06-12 12-12 06-13 60% 80% 100% 120% 140% NAV Benchmark Index Share Price SINGLE YEAR PERFORMANCE (5 YEARS ENDING JULY) Cumulative Growth YTD 1mth 6mths 1 yr 3 yrs 5 yrs 10 yrs Since 05.11.91 Share Price 17.6% 7.2% 7.8% 35.8% 60.3% 38.8% 236.3% 1727.9% NAV 19.6% 6.9% 9.2% 33.8% 49.9% 41.3% 232.5% 1944.3% FTSE World Europe Ex-UK Index 19.4% 7.7% 9.2% 36.0% 33.5% 32.3% 139.2% 585.8% Ranking within European Inv. Trust Sector (Share Price) Position of the company 7 6 4 5 3 6 4 1 Total number of companies 8 8 8 8 8 8 6 4 Quartile Ranking 4 3 2 3 2 3 3 1 PERFORMANCE RECORD Please remember that past performance is not a guide to what may happen in the future. The value of investments can go down as well as up and you may not get back the amount you invested. Overseas investments may be subject to currency fluctuations. Investments in small and emerging markets may be more volatile than more established markets. Please remember the eligibility to invest in an ISA depends on individual circumstances and tax rules may be subject to change. CB.UK.201307.2823.PRO.PDF J Ju ul l 0 08 8- - J Ju ul l 0 09 9- - J Ju ul l 1 10 0- - J Ju ul l 1 11 1- - J Ju ul l 1 12 2- - J Ju ul l 0 09 9 J Ju ul l 1 10 0 J Ju ul l 1 11 1 J Ju ul l 1 12 2 J Ju ul l 1 13 3 Share Price -18.3% 5.9% 21.4% -2.7% 35.8% NAV -14.8% 10.6% 18.3% -5.3% 33.8% FTSE World Europe -10.8% 11.1% 12.5% -12.8% 36.0% Ex-UK Index P Pr ri ic ce e R Re ec co or rd d J Ju ul l J Ju ul l J Ju ul l J Ju ul l J Ju ul l 0 09 9 1 10 0 1 11 1 1 12 2 1 13 3 Share Price (pence) 945.00 980.50 1173.00 1115.00 1485.00 NAV (pence) 1083.35 1177.24 1376.22 1277.47 1680.98 Investment available via ISA and Share Plan Source of performance: Fidelity/Datastream, cumulative growth, total return as at 31 July 2013, bid-bid with net income reinvested. These figures do not include an initial charge. Rankings: Morningstar.Quartile rank refers to performance over time rated on a scale of 1-4. A ranking of 1 indicates that the item being ranked is in the top 25% of the sample; a quartile of 2 indicates it’s in the top 50% and so on.