Royal London Japan Growth is an unusual style of Japanese fund that offers investors significantly lower volatility than its peers in the IMA Japan sector. Since taking over management of the fund in December 2007 David Varley has consistently produced returns that place him towards the top of the IMA Japan sector, without the volatility in returns typical of most Japanese funds and with a very competitive management fee.
Varley does not attempt to forecast the economic environment or try to predict turning points in the market. He believes that this is very difficult to do consistently. His main interest lies in seeking to reduce risk to a minimum whilst still producing top quartile performance amongst his IMA peers. Key investment characteristics of the fund are that Varley seeks to match the sector weightings of the index, the individual companies within each sector are bought on a relative value basis. Through this method Varley has in fact managed to achieve returns substantially better than his stated target and the fund is a good option for investors looking for relatively low risk exposure to Japan.
Awarded 4 stars.