fund

Rated

This is one of our rated funds. They’re the ones our experts believe will do well for investors over the longer term. Top of the class!

JPM Japan C

A mid and small cap biased fund, benefiting from resources in London and Tokyo.

  • 341.30p
    Price (Inc)

    These are the shares in the fund that pay out an income to clients. The income is made up of the total dividends – the money a company can pay out to its investors – from the companies in the fund.

  • 329.30p
    Price (Acc)

    These are the shares in the fund that don’t pay out an income to clients. Any dividends – the money a company can pay out to its investors – are reinvested into companies in the fund. Despite no income, the shares should be worth more over time. Good incentive, eh?

  • 0.00%

    Initial charge

    Some funds charge you when you first invest, which is aptly known as the initial charge. They’re usually between 3-5% but at Bestinvest, we usually don’t charge you a penny!

  • 0.75%
    Annual management charge

    This is how much the fund management company charges to run the fund. It’s like paying a babysitter, dog sitter or house sitter (that makes well-informed, heavily researched changes to improve your baby/dog/house when needed).

  • 0.79%
    Ongoing charges

    This stands for Ongoing Charges Figure. It’s the cost of running a fund and includes admin fees, manager fees, administration costs, etc.

  • 0.10%
    Yield

    How much the fund is currently paying out in income to investors. It’s NOT to be confused with the overall growth of a fund – a very different thing indeed. It’s also NOT a guarantee of future pay-outs, just a snapshot. This is more what it’s not than what it is…

Prices as at 25 January 2022, fund commentary last updated 15 October 2021

The fund aims to provide long-term capital growth by investing at least 80% of its assets in Japanese companies benefiting from a resurgent economy. Lead manager Nicholas Weindling looks to invest in quality ‘New Japan’ rather than ‘Old Japan’ stocks. These are companies which are taking advantage of structural changes in the country such as the growth of digitisation. Holdings include measurement sensor maker Keyence and games console group Nintendo. Weindling has a bottom-up investment approach combined with top-down view on the Japanese economy. The fund has a distinctive ‘boots on the grounds’ strategy with a 25-strong Japanese-based team.

Fund summary

Sector Japan
Structure OEIC
Launched September, 2007
Size £1,665m
Yield 0.10%
Charging basis Income
Dividends paid 30 Apr

Charges

Standard initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 0.75%
Ongoing charges figure 0.79%

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Investment process

The fund seeks to identify high quality companies in Japan with superior and sustainable growth potential. Weindling begins the process by asking himself – “Do we want to own this company over the long-term?”. He targets companies with sustainable return on equity, pricing power, competitive advantage, a strong balance sheet and shareholder-focused management teams. The investment universe is around 500 names which are categorised into Premium, Quality or Trading based on the economics, growth structure and governance of each company. Stocks are then rated on their expected performance by considering risks and valuation on a scale of 1 to 5, with 1 being the highest. Most of the portfolio holdings are rated as premium and quality. Weindling believes that Japan is at least 20 years behind the West in terms of digitisation and trends such as e-commerce, cloud adoption and cashless payments. As such he looks for firms which will lead Japan’s transformation and benefit from other long-term structural trends such as an ageing population and emerging middle class. The fund has little or zero exposure to what he believes are more challenged sectors in Japan, such as Banks and Transportation equipment. The portfolio has between 40 and 80 holdings with an investment time horizon of between 3 and 5 years. It can be split into seven themes with the three largest being Digital Adoption, Japan Brands and Automation.

The fund benefits from the 19 years of investment experience, much of it in Japanese equities, of lead manager Nicholas Weindling. He is supported by two co-managers, Miyako Urabe and Shoichi Mizusawa and can also tap into the wider JP Morgan research team which has over 150 Japanese analysts. Japan remains an under-researched market which creates opportunities for active managers. The JPM Japan team are all based in the country, which gives them a significant advantage in better understanding the market as well as finding and talking to the management teams of these growing firms. Given its high quality-growth focus the fund can have periods of significant underperformance, but historically it has delivered compelling excess returns.

Manager research

Average monthly relative returns

  • 17/18 -0.07%
  • 18/19 0.26%
  • 19/20 0.66%
  • 20/21 2.20%
  • 21/22 -0.37%

Bestinvest MRI

  • 3 years 0.83%
  • 5 years 0.54%
  • Career 0.23%
  • 3 years 97.80%
  • 5 years 95.70%
  • Career 91.50%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Nicholas Weindling

Weindling, managing director, is a country specialist for Japan equities and a member of the Japan team within the Emerging Markets and Asia Pacific (EMAP) Equities team based in Tokyo. He joined the firm in 2006 from Baillie Gifford in Edinburgh where he spent four years, initially as a UK large cap analyst and latterly as a Japanese equities investment manager. Weindling obtained a BA (Hons) in History from Pembroke College, Cambridge.

Track record

Nicholas Weindling has 13.8 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.23%. During the worst period of relative performance (from January 2008 - April 2009) there was a decline of 21% relative to the index. The worst absolute loss has been 56%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 92%.

Periods of worst performance

Absolute -56.00% (January 2008 - March 2009)
Relative -21.00% (January 2008 - April 2009)

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

Allocation

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Top 10 holdings

Data accurate as at 30 November 2021

7.4% Keyence Corp
7.2% Recruit Hldgs Co Ltd
6.9% Hoya Corp
5.4% Tokyo Electron
5.3% Sony Group Corp
3.8% Shin-Etsu Chemical Co
3.7% Nomura Hldgs Inc
3.3% Obic
3.2% Smc Corp
3.1% Monotaro Co.ltd
Source: Trustnet

Sector breakdown

Electronic & Electrical Equipment 24.00%
Services 18.00%
Communications 15.00%
Precision Instruments 9.00%
Retail 7.00%
Machinery 7.00%
Others 5.00%
Chemicals 4.00%
Wholesale 2.00%
Transport Equipment 2.00%

Portfolio

The number of holdings ranges between 40 and 60 while the top 10 usually represents over 30%.

Key Investor Information - Income

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Key Investor Information - Accumulation

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