Schroder Japan Growth Fund is the top-performing Japan investment trust focused on larger companies over one and five years both in terms of net asset value (NAV) and share price. The trust aims for growth in excess of the Tokyo Stock Exchange First Section Total Return Index over the longer term, and succeeds in doing this over one and three years.
The trust invests in Japanese companies with a proven track record and solid profits growth prospects that are not fully reflected in the share price. Its manager believes that valuation discrepancies are caused by short-term sentiment, and tend to narrow in the long term as other investors take advantage of goo- value share prices among good-quality companies.
The trust has no constraints in the size of company it invests in or sector allocation, allowing it to take advantage of changes in market sentiment and in the domestic economic cycle as it develops. However, no more than 15 per cent of the trust's total net assets can be invested in any single company at the time of acquisition.
The trust doesn't pay dividends, but its board is discussing introducing these, and proposals will be put to shareholders this year.
The trust has an experienced manager in Andrew Rose, who has over 25 years of investment experience, largely with Japanese equities. He has run this investment trust since 2007.
However, the trust's holdings include smaller companies that can add volatility to returns and, although it trades at a discount to NAV, this is already tighter than its 12-month average.
SCHRODER JAPAN GROWTH (GB0008022849) | |||
PRICE | 96.14p | GEARING | 110% |
AIC SECTOR | Japan | NAV | 109.43p |
FUND TYPE | Investment trust | PRICE DISCOUNT TO NAV | -10.75% |
MARKET CAP | £120.63m | 1-YEAR PRICE PERFORMANCE | 9.66% |
No OF HOLDINGS: | 83* | 3-YEAR ANNUALISED PRICE PERFORMANCE | 16.20% |
SET-UP DATE | 11-Jul-94 | 5-YEAR ANNUALISED PRICE PERFORMANCE | -1.60% |
TOTAL EXPENSE RATIO | 1.69% | MORE DETAILS | www.schroders.com |
Source: Morningstar, *Schroders. Performance data as at 2 April 2012.
TOP TEN HOLDINGS as at 29 February 2012
Toyota Motor | 5.7 |
Mitsui & Co | 4.7 |
SK Kaken | 3.6 |
Hi Lex | 3.5 |
East Japan Railway | 3.3 |
Bridgestone | 3.3 |
Sumitomo Mitsui Financial | 2.8 |
Seven & I Holdings | 2.4 |
T&D Holdings | 2.3 |
NKSJ Holdings | 2.3 |
Sector breakdown
Industrials | 32.1 |
Financials | 19.5 |
Consumer Goods | 18.3 |
Consumer Services | 17.7 |
Basic Materials | 7.6 |
Healthcare | 4.7 |
Telecommunications | 4.5 |
Technology | 4.4 |
Oil & Gas | 2.3 |
Cash | -11.3 |