When Mr Bolton established the Fidelity China Special Situations trust in 2010, we always felt that this could be a bridge too far for the veteran value manager. "Buru duchang" said Mr Bearbull in his best Chinese - loosely translated it means "worse than a casino", the observation of Chinese economist Wu Jinglian of his country's markets and a warning we thought anyone considering an investment in the trust would do well to heed.
We also issued a sell tip on the investment trust in November - huge investor interest in the trust's launch had seen its shares soar to a near 10 per cent premium to its net assets, too rich we believed, even for a man of Mr Bolton's pedigree. The shares stood at a near 8 per cent discount before Mr Bolton announced his retirement.
There are important warnings to be drawn from Mr Bolton's struggles in China. One is that buying into the cult of the fund manager isn't a magical route to guaranteed riches. Although this publication doesn't, like some investment commentators, dismiss out of hand the idea that good fund managers can beat the market, we're also always mindful that "past performance is not a guide to future returns".
We're also looking for reassurance that a manager's strategy makes sense - and sticking to a tried and tested approach is what often makes managers great; conversely, being carried on the wind of investment whims often makes for bad ones. Mr Bolton's reputation was cultured doing the first and, it seems, stained doing the latter - put simply, he made an ill-timed decision to enter a market he did not know as well as his own in the quest for stellar returns. Was this the same Anthony Bolton who famously avoided tech stocks during the great 90s bubble?
To be fair to Mr Bolton, his trust has beaten its benchmark, losing 5 per cent of its NAV since launch versus a 6.2 per cent fall in value of the MSCI China index - although with developed world markets racing away this year, he has clearly been in the wrong place at the wrong time. Yet history could still vindicate Mr Bolton - the market's current distaste for China and other emerging markets is more a reflection of fears over US monetary policy than these countries' powerful growth prospects. As we argue in this week's cover feature, those with an eye for value over the long term shouldn't call time on emerging markets just yet - even if the short-term looks rather uncertain.
