QPR.en.xx.20210630.GB00B88V3X40.pdf For Investment Professionals Only FIDELITY INVESTMENT FUNDS QUARTERLY PERFORMANCE REVIEW SPECIAL SITUATIONS FUND W - ACC SHARES 30 JUNE 2021 Portfolio manager: Alex Wright, Jonathan Winton Performance over quarter in GBP (%) Performance for 12 month periods in GBP (%) Fund 6.3 Market index 5.6 FTSE All Share Index Market index is for comparative purposes only. Source of fund performance is Fidelity. Basis: bid-bid with income reinvested, in GBP, net of fees. Other share classes may be available. Please refer to the prospectus for more details. Fund Index Market Environment UK equities rose over the second quarter. Markets started on a strong note on increasing optimism around the prospects of a reopening given an acceleration in vaccination rollouts. A sharp pick-up in corporate earnings and continued strength in economic data boosted investor sentiment. However, a pick-up in inflation readings led to some concerns. While the Bank of England (BoE) continues to see the current inflation pressures as transitory, the US Federal Reserve’s (Fed) more aggressive tone temporarily unsettled markets. Meanwhile, worries about the spread of a more transmissible COVID-19 variant led to a more cautious stance. For the most part, vaccines appear to be keeping hospitalisation rates under control, but virus concerns remain a source of worry going forward. In this environment, most sectors reported flat to positive returns, with the decline in bond yields helping growth stocks and bond proxies outperform. Health care and utilities were among the biggest gainers, while more cyclical sectors such as financials and consumer discretionary underperformed. The UK economy appears to be on course for a strong rebound, supported by the easing of social distancing restrictions, as evidenced by the latest economic indicators. For instance, the latest GDP estimates suggest an expansion of 2.3% in April, the fastest monthly rise since July 2020, with strong retail spending and the resumption of schooling supporting growth. Similarly, business activity picked up momentum and saw record growth during the quarter, according to IHS Markit. As the economy recovered from the pandemic, inflation rose sharply over the quarter to 2.1% in May, marginally breaching the BoE’s 2% target. Fund Performance In the second quarter of 2021, the W-ACC share class of the fund returned 6.3% in GBP terms; the FTSE All Share (N) index returned 5.6%. Strong stock selection in the consumer discretionary and financials sectors contributed to returns, while an overweight in industrials also proved beneficial. Merger & acquisition (M&A) activity was a major contributing factor At a stock level, private healthcare provider Spire Healthcare was the biggest contributor. Australian hospital operator Ramsay Health Care reached an agreement with Spire to buy the company for £1 billion, subject to a shareholder vote. UK infrastructure investor John Laing also benefited from M&A news after private-equity firm KKR agreed to buy the company, at a significant premium, in a deal valued at about £2 billion. Holdings in Redde Northgate and Roche added value Redde Northgate, the UK's largest commercial vehicle rental provider, was another notable contributor as demand in the UK has picked up significantly, COVID-19 has accelerated the move to lease and renting and the Redde integration is progressing well. The position in pharmaceuticals major Roche added value on the back of news flow over Alzheimer drugs of competitors, which were seen as a catalyst to Roche's own Alzheimer's assets causing the shares to move higher. Notable detractors The lack of exposure to certain expensive defensive names such as pharmaceuticals group AstraZeneca and beverages group Diageo held back relative performance. At a stock level, insurers Legal & General, Phoenix Group and Just Group were among the detractors. Legal & General also went ex-dividend in mid-April which impacted the overall share price performance. Fund Positioning Despite the strong market returns seen over the past year, we remain excited by the investment opportunities on offer. What is particularly unusual about the current backdrop is that corporate fundamentals are very good, and we are finding attractively valued companies of better quality than would normally be the case. The value on offer has not gone unnoticed by acquirers, especially foreign buyers, and we have seen further takeover bids over the past quarter. Focus on beneficiaries of domestic recovery In terms of positioning, we continue to favour UK consumer-facing and construction-related holdings, which are seeing particularly strong trading and should be key beneficiaries of the domestic recovery. Higher household savings trends are evident everywhere, particularly in the UK and even more so in Ireland. We have not changed our positioning in the consumer sectors as these stocks still offer very good value versus history, and our earnings estimates for the fund’s holdings in the segment remain ahead of consensus forecasts. Raised exposure to the oil & gas sector We have increased exposure to the oil & gas sector in view of rising oil prices, by adding to smaller exploration & production names with strong upside potential. The holding in Royal Dutch Shell was also increased as the company settles for a more capital light pivot into new energy, reducing the risk of value destructive acquisitions and divestitures. The fund has limited exposure to sectors that have been heavily impacted by Covid restrictions. Important Information Past performance is not a reliable indicator of future results. The fund's returns can be affected by fluctuations in currency exchange rates. The value of investments and any income from them may go down as well as up and an investor may not get back the amount invested. The use of financial derivative instruments may result in increased gains or losses within the fund. This fund invests more heavily than others in smaller companies, which can carry a higher risk because their share prices may be more volatile than those of larger companies. QPR.en.xx.20210630.GB00B88V3X40.pdf For Investment Professionals Only FIDELITY INVESTMENT FUNDS QUARTERLY PERFORMANCE REVIEW SPECIAL SITUATIONS FUND W - ACC SHARES 30 JUNE 2021 Attribution Performance attribution is produced in the currency shown below. For funds with multiple share classes, the attribution return reflects the aggregate performance across all the share classes. It may therefore deviate from the published return for a particular share class. When using the analysis for hedged share classes, please consider that the attribution is shown before the impact of hedging. The contributions shown in the tables are before the impact of charges. If charges are applied, their effect is captured in the “Other” category in the tables and will also be reflected in the fund return. All investments, including derivatives, linked to a particular issuing company have been combined to form a total percentage for each issuing company. The sector/industry and geographic contribution tables (where relevant) display a maximum of eleven individual entries. Where applicable, only top five and bottom five are listed, with the remaining contribution shown in the "Other Sectors" or “Others” category. Currency of attribution UK Sterling (GBP) Three month relative return (%) 0.76 Position Contribution (%) 3 months Average Relative Average Relative Relative Performance Relative Performance TOP CONTRIBUTORS Weight Contribution TOP DETRACTORS Weight Contribution SPIRE HEALTHCARE GROUP PLC 1.5 0.53 ASTRAZENECA PLC -4.3 -0.60 JOHN LAING GROUP PLC 2.2 0.45 LEGAL AND GENERAL GROUP PLC 4.5 -0.48 REDDE NORTHGATE PLC 1.6 0.34 DIAGEO PLC -3.2 -0.31 PRUDENTIAL PLC -1.7 0.29 PHOENIX GROUP HOLDINGS PLC 2.2 -0.28 KASPI/KZ JSC 0.9 0.27 DCC PLC 2.4 -0.24 ROCHE HOLDING AG 2.5 0.27 JUST GROUP PLC 1.3 -0.20 HSBC HOLDINGS PLC -3.8 0.27 DIXONS CARPHONE PLC 1.1 -0.19 FLUTTER ENTERTAINMENT PLC -1.0 0.23 GLAXOSMITHKLINE PLC -2.8 -0.17 ELECTRA PRIVATE 0.4 0.21 AIB GROUP PLC 2.0 -0.17 KIN AND CARTA PLC OLD 0.5 0.21 ORIGIN ENTERPRISES PLC 0.9 -0.16 Positions in other funds - including ETFs (Exchange Traded Funds) - can appear in this table, but index derivatives form part of an "Index / Unclassified" category which will appear in the table(s) below when relevant. Names of any positions being shorted at the reporting date have been withheld in line with Fidelity’s disclosure policy. Sector/Industry Contribution (%) 3 months Geographic Contribution (%) 3 months CONTRIBUTIONS TO RELATIVE RETURN CONTRIBUTIONS TO RELATIVE RETURN Average Sector/ Total Average Total Relative Security Industry Relative Relative Security Geographic Relative icb Industry Weight Selection Selection Contribution Weight Selection Selection Contribution Consumer Discretionary 8.8 0.72 -0.24 0.48 United Kingdom -16.0 0.94 0.00 0.95 Financials 3.3 1.72 -1.32 0.40 Kazakhstan 0.9 0.27 0.00 0.27 Industrials 10.6 0.09 0.24 0.33 Switzerland 2.5 0.27 0.00 0.27 Technology -1.0 0.20 0.00 0.20 Australia 1.2 0.13 0.00 0.13 Health Care -1.4 0.09 -0.03 0.06 United States 1.6 0.11 0.00 0.11 Basic Materials -5.2 0.01 0.05 0.06 Bermuda 0.7 -0.04 0.00 -0.04 Real Estate -1.0 -0.09 0.07 -0.02 Germany 0.9 -0.09 0.00 -0.09 Energy -2.6 -0.17 0.07 -0.09 Netherlands 0.2 -0.12 0.00 -0.12 Telecommunications 2.8 -0.07 -0.06 -0.14 Sweden 1.4 -0.16 0.00 -0.16 Utilities -0.7 -0.08 -0.13 -0.20 Ireland 6.1 -0.73 0.17 -0.56 Consumer Staples -10.7 -0.11 -0.18 -0.29 Others 4.4 0.18 -0.02 0.16 Index / Unclassified 1.0 0.14 0.00 0.14 Total Primary Assets 3.9 2.45 -1.53 0.92 Total Primary Assets 3.9 0.77 0.15 0.92 Other* -3.9 -0.17 Other* -3.9 -0.17 TOTAL 0.0 0.76 TOTAL 0.0 0.76 *Other includes portfolio components not already listed such as cash, expenses and other miscellaneous items.