Ride the coronavirus recovery with JPMorgan Emerging Markets IT

However, for most investors a single-country China fund is too high-risk. A better option is a broad Asian or global emerging markets fund with meaningful exposure to China alongside investments in other economies. Options include JPMorgan Emerging Markets Investment Trust (JMG), which had nearly 40 per cent of its assets invested in China at the end of March.

The trust had not been able to invest more than 50 per cent of its assets in what its managers defined as one region. But in April the trust's board amended its investment policy so that the trust's managers could "temporarily continue holding and investing in regions that have performed more robustly in this crisis," explained JPMorgan Asset Management. "East or north Asia as a region is defined as China, Taiwan, Korea and Hong Kong. With strong performance, notably from China stocks... limiting 50 per cent [of the trust’s assets] to that region would force its managers to have an underweight to that area irrespective of their views”.

The amendment to the investment policy means that the trust’s managers won’t have to sell existing holdings in these countries if, as a result of strong share price growth, they account for more than 50 per cent of the trust’s assets. And if they see good investment opportunities there they could add to them.

JPMorgan Emerging Markets Investment Trust has been run by Austin Forey since 1994, and he is supported by more than 90 analysts in emerging markets and Asia. they typically invest in good quality, resilient companies that have a better chance of surviving the downturn that is likely to follow the spread of the coronavirus. They favour companies with strong balance sheets and good managements, and maintain dialogue and engagement with them so are up to date on what their situation is.

Increasing exposure to any one region is a risk because if it does not do well the trust could experience net asset value (NAV) and share price falls.

The trust was on a discount to NAV of 9 per cent at close on 28 April. But this is not its widest point, so it could return to the wider levels at which it has traded in the past. And the trust’s focus on sustainable, high-quality growth companies means that it may not outperform its benchmark or some other emerging markets funds when emerging market equities are rising strongly.

However, Mr Forey has a long record of making the right calls and has managed the trust through other periods of market stress. He is not obliged to invest up to the new limits on geographic exposure, so will not do so if it doesn't seem beneficial. The new investment limits are also temporary and the trust’s board will keep them under review.

Although the trust is not at its cheapest, it has traded at tighter discounts, and its board buys back shares if the discount is wider than 10 per cent, and when it is narrower if it thinks it is in shareholders’ interests. So if the discount widens measures would be taken to bring it back in.

The trust also has a strong long-term performance record and beats MSCI Emerging Markets index and the average return for emerging markets investment trusts over one, three and five years.

So if you are a long-term growth investor seeking exposure to China and other promising regions, but cannot take on the risk of a single-country fund, JPMorgan Emerging Markets Investment Trust looks like a good way to do this. Buy.