Legg Mason IF Japan Equity X

Highly concentrated on small, fast growing companies, this fund will be significantly more volatile than most in the sector.

  • 475.00p Price (Inc)
  • - Price (Acc)
  • 0.00% Initial charge
  • 0.75% Annual management charge
  • 1.02% Ongoing charges
  • 0.00% Yield

Prices as at 05 December 2019, fund data last updated 30 December 2015

The fund aims to produce a capital return above the TOPIX index over a full market cycle. Tokyo based Hideo Shiozumi has been managing Japanese equity money since 1970 and specialises in smaller and mid capitalisation companies. The portfolio is concentrated and has little resemblance to any benchmark so relative performance can differ substantially. This also means that the portfolio differs greatly from those that UK investors typically get exposure to.

Fund summary

Sector Japan
Structure OEIC
Launched December, 2012
Size £959m
Yield 0.00%
Charging basis Income
Dividends paid Acc units only

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 1.02%

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Investment process

Stock selection arises from extensive research undertaken on potential holdings. This will include meeting company management, customers and competitors. Stocks are held strategically over a long period of time and the portfolio tends to be concentrated with a high weight given to the top ten holdings. On a long term view the fund manager believes that Japan is experiencing cultural and social change with the market moving from being biased to manufacturing to one which is more service and consumer-orientated. The fund therefore aims to identify 'new Japan' companies, which have rapid and consistent earnings growth. These are companies which have grown by a minimum of 20% pa over at least two years and are predicted to grow by at least this level in the future. The fund has no exposure to the well known Japanese manufacturers or banks. Instead the portfolio is focused primarily in service, retail and wholesale stocks that are benefiting from consumers' increasing use of the internet. Another theme in the portfolio is healthcare, which aims to take advantage of the unfavourable demographics in Japan.

Hideo Shiozumi is an experienced manager of Japanese equities. During his career he has had periods of considerable outperformance. This is due to his investment style which seeks primarily small cap companies that generate most of their revenues domestically. These stocks tend to exhibit significant volatility, and therefore this strategy should be regarded as relatively high risk. Therefore this fund is only appropriate for higher risk investors or as part of a diversified portfolio.

Manager research

Average monthly relative returns

  • 14/15 1.19%
  • 15/16 2.24%
  • 16/17 -0.17%
  • 17/18 1.03%
  • 18/19 -0.05%

Bestinvest MRI

  • 3 years 0.27%
  • 5 years 0.85%
  • Career 0.68%
  • 3 years 69.50%
  • 5 years 93.90%
  • Career 98.90%

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

Hideo Shiozumi

Shiozumi has over 40 years’ experience in Japanese equities. He operates in a boutique culture and has three analysts on his staff, one of whom is his daughter. In 1990 he founded Shiozumi Asset Management which has subsequently been appointed as Investment Advisor of the Legg Mason IF Japan Equity Fund. Prior to this Shiozumi ran the Japanese portfolio for George Soros’ Quantum fund from 1983. He started his career with Robert Fleming, where he joined as an analyst in 1970. He was educated in USA and holds a BA in Economics from Guilford College, Greensboro.

Track record

Hideo Shiozumi has 28.4 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.68%. During the worst period of relative performance (from February 2000 - August 2010) there was a decline of 78% relative to the index. The worst absolute loss has been 79%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 99%.

Periods of worst performance

Absolute -79.00% (December 2005 - October 2008)
Relative -78.00% (February 2000 - August 2010)

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.

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Top 10 holdings

Data accurate as at 31 July 2019

9.5245% Peptidream Inc
7.9245% Nihon M&A Center Inc
7.0642% M3 Inc
6.354% Pan Pacific Intl Hldgs Corp
4.7375% Gmo Payment Gateway Inc
4.5346% Sms Co Ltd
4.218% Nintendo Co
3.7136% Digital Arts Inc
3.5976% En-Japan Inc.
3.5332% Asahi Intecc Co Ltd
Source: Trustnet

Sector breakdown

Industrials 30.00%
Health Care 28.00%
Consumer Discretionary 12.00%
Consumer Staples 11.00%
Information Technology 8.00%
Communications 7.00%
Real Estate 3.00%
Financials 1.00%

Portfolio

Typically 30 to 50 companies are held in the portfolio. The top ten will usually account for around 50% of the portfolio.

Constraints

There are no specific stock or sector restrictions.

Key Investor Information

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