JPMorgan Russian Securities is the only UK retail investment trust that focuses purely on Russia. The fund is managed by Russian native Oleg Biryulyov, who is supported by JPMorgan's experienced global emerging markets team.
The fund, which was launched in 2002, features a highly concentrated, aggressive portfolio, placing it firmly at the 'riskier' end of the investment spectrum. While the fund has lagged behind its benchmark, the MSCI Russian 10/40 Equity Indices Index (£) over certain timeframes, since inception it has outperformed the index by around 3 per cent.
The fund aims to provide capital growth through investment in Russian securities. It will hold no more than 10 per cent in the assets of a single company and no more than 15 per cent in UK-listed investment companies with exposure to Russia.
The fund is less costly than many open-ended funds focused on Russia with a total expense ratio (TER) of 1.82 per cent. However it is still significantly more expensive than exchange traded funds (ETFs) focused on Russia, such as the db X-trackers MSCI Russia 25% Capped (with a TER of 0.65 per cent) which has a similar performance record.
It is worth noting that the board and investment managers agreed to introduce additional controls on portfolio construction. These limit the amount by which sector positions in the portfolio can deviate from the benchmark index and introduce a maximum overweight position per stock against its index weighting. The aim of the controls is to reduce the volatility of the fund's performance when compared with its benchmark. However, the investment team is still able to operate with a high degree of conviction in relation to sector and individual stock weightings. Their preference is for sectors benefiting from robust domestic demand and companies delivering consistently high returns based on strong free cash flow.
JPMORGAN RUSSIAN SECURITIES (JRS) | |||
---|---|---|---|
PRICE | 491p | GEARING | 100 |
AIC SECTOR | Country Specialists: Europe | NAV | 536.36p |
FUND TYPE | Investment trust | PRICE DISCOUNT TO NAV | -3.13% |
SIZE OF FUND | £292.4m* | 1-YEAR PRICE PERFORMANCE | -28.00% |
No OF HOLDINGS: | na | 3-YEAR PRICE PERFORMANCE | 84.00% |
SET UP DATE | 20 December 2002 | 5-YEAR PRICE PERFORMANCE | -17.00% |
VOLATILITY | 35.2 | TOTAL EXPENSE RATIO | 1.82% |
TRACKING ERROR | 22.38 | YIELD | nil |
SHARPE RATIO | -0.65 | MORE DETAILS | jpmorganassetmanagement.co.uk |
Source: Thomson Reuters Datastream, *JPMorgan Asset Management
Performance figures as at 18 July 2012
Top 10 holdings (as at 30 June 2012)
Company | Percentage (%) |
---|---|
Lukoil ADR | 12.1 |
Sberbank of Russia ADR | 9.5 |
Mobile Telesystems ADR | 5.9 |
Tatneft ADS | 4.6 |
Magnit | 4.5 |
Gazprom ADR | 4.3 |
Dixy | 4.2 |
Novatek GDR | 4.0 |
Mostotrest | 3.6 |
JSC MMC Norilsk Nickel ADR | 3.5 |
Sector breakdown
Sector | Percentage (%) |
---|---|
Energy | 31.4 |
Consumer Staples | 13.8 |
Financials | 11.5 |
Materials | 11.1 |
Consumer Discretionary | 10.5 |
Telecommunication Services | 10.3 |
Industrials | 3.6 |
Healthcare | 2.3 |
Utilities | 1.9 |
Information Technology | 0.6 |
Cash | 3.0 |