Bolton stays in China, Fidelity China says

Stock picker extraordinaire Anthony Bolton has signed on for another year as Portfolio Manager at investment firm Fidelity China Special Situations as he tries to make good the losses he has racked up so far.

Bolton, one of the most consistently successful portfolio managers of the last 30 years, has thus far been unable to repeat the success he had based in the UK since he took on the challenge of managing a fund focused on investing in Chinese companies.

In the final three months of 2011 the fund's net asset value (NAV) rose by 3.49% (assuming debt is valued at par), whereas the benchmark index against which the fund's performance is measured rose by 8.365 over the same period.

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In the preceding six month period the NAV per share total return, which includes dividend payments, declined by 28.9%.

Bolton's decision to extend his tenure until April 2014 has been motivated, in part, by a desire to nurse the fund back to health.

"I've been disappointed and performance has been a factor in my decision. It has been the worst conditions I have ever managed money in. Hong Kong had a terrible year and suffered more than most markets," Bolton said, according to a report in the Daily Telegraph.

Bolton admitted to still having a few things to learn about China. A couple of stocks in which he invested succumbed to reverse takeovers from firms seeking a cheap route to a US stock exchange listing.

According to the Telegraph, Bolton said some of the companies taking this route indulged in "outright fraud". Bolton has tightened up his due diligence procedures in an attempt to screen out these sorts of companies in the future.

JH