Rated Fund 2016-2017. Stockpicker who looks for out-of-favour companies
This fund invests predominantly - at least 80 per cent - in Japanese companies that are in the bottom third of all publicly listed equity in Japan in terms of size. It typically holds between 30 and 50 stocks.
Johan du Preez has been the fund's official manager since 2015, but in fact he was part of the team running it previously on an outsourced basis at Eastspring Investment, a sister company of Prudential, which owns M&G.
The investment approach that du Preez follows tends to be contrarian in nature. His stockpicking approach appears well-suited to the Japanese market, which he believes has undergone fundamental change in recent years.
He looks for shares in companies that he believes are on cheap valuations relative to the returns he expects these businesses are likely to generate over the medium to long-term. These companies are quite often out of favour with the market for one reason or another.
Du Preez aims to exploit the behavioural biases that he says are evident in Japan's equity markets whereby human emotions, such as fear or greed, prevent investors from always assessing investments rationally. As a result shares in companies become mis-priced because investors buy and sell regardless of inherent value characteristics.
He believes the changes occurring in Japan today are not cyclical, but structural and offer sustainable attractive returns for those investors who can sail into the headwinds buffeting other investors' emotions.