First State Japan Focus Fund Class B (Accumulation) GBP

Japanese Equities

New for 2020. A focused portfolio of medium and large companies  

First State Japan Focus has made its mark since its launch in 2015, having delivered returns that consistently put it in the first quartile and earn it a place in our Rated Funds for 2020. The fund remains under the radar of many investors and is yet to attract meaningful assets – it is just £24 million in size, so it’s something of a hidden gem.

Experienced Asian investor Martin Lau and analyst Sophia Li have run the fund from the outset, investing in the shares of large and mid-sized firms in Japan. These generally have a total stockmarket value of at least $1 billion (£0.7 billion).  The portfolio is relatively concentrated in around 40 names, which sets it apart from many of its competitors. Its top 10 holdings account for 43% of assets.

Lau and Li back their best ideas: their top holding, Keyence Corporation – a manufacturer of sensors, barcode readers and measuring instruments – commanded 5% of assets at the end of 2019. Industrials is the largest sector weighting at almost 25%, followed by consumer staples (23%), consumer discretionary (18%) and technology stocks (11%). The fund’s charges are a little high at 1.1%, but this is not out of kilter with the wider Japanese equities sector.

The fund holds a ‘high’ Morningstar sustainability rating, the result of the fund’s longstanding focus on embedding responsible investment across its operations. The value of environmental, social and governance investment quadrupled in Japan between 2016 and 2018, according to the Global Sustainable Investment Alliance.

Narrative and ratings content all as of January 2020.

See all Money Observer rated funds
Name
First State Japan Focus Fund Class B (Accumulation) GBP
Manager
First State Investments (UK) Ltd
Type
Open Ended Investment Company
ISIN
GB00BWNGX432
Sector
Japan
Launched
26/10/2015
OCF
1.1 %
Risk Rating
4
3 Year Sharpe
0.91
3 Year Alpha
9.66
Yield
0 %
Benchmark
MSCI Japan 100% Hdg NR GBP
The Fund aims to achieve long-term capital growth. The Fund will predominantly invest in large and midcapitalisation equity securities issued by companies that are established, operating or have their economic activities mainly in Japan and which are listed, traded or dealt in on Regulated Markets worldwide and in equity related instruments listed, traded or dealt in on Regulated Markets worldwide which provide exposure to Japan. The Fund may also invest in other equity securities and equity related instruments which are listed, traded or dealt in on Regulated Markets worldwide as well as in cash and near cash.
Holding %
Keyence Corp 5.79 %
Kao Corp 5.23 %
Recruit Holdings Co Ltd 5.01 %
Fast Retailing Co Ltd 4.42 %
Welcia Holdings Co Ltd 4.37 %
Shiseido Co Ltd 4.29 %
Shin-Etsu Chemical Co Ltd 4.07 %
OBIC Co Ltd 4.00 %
MonotaRO Co Ltd 3.95 %
Pigeon Corp 3.67 %
Region %
Japan 100.00 %
Sector %
Industrials 22.45 %
Consumer Defensive 21.31 %
Technology 17.88 %
Healthcare 14.51 %
Consumer Cyclical 12.45 %
Basic materials 5.65 %
Name
First State Investments (UK) Ltd
Address
EC2M 7EB, London, United Kingdom
UCITS
Yes
Legal Structure
Open Ended Investment Company

Managers

Sophia Li
Joined 10/26/2015
Martin Lau
Joined 10/26/2015

Martin Lau is a Managing Partner of First State Stewart Asia, part of First State Investments. Martin has more than 22 years of experience in managing Asia Pacific and Greater China portfolios. He joined the First State Stewart Asia team in April 2002 and is based in Hong Kong. Martin is the lead manager of a number of First State funds: the First State Asian Equity Plus Fund, the First State Asian Bridge Fund, the First State Asia Pacific All Cap Fund, the First State New Era PRC Fund, the First State China Growth Fund, the First State Greater China Growth Fund and the First State Hong Kong Growth Fund. Martin graduated from Cambridge University with a Bachelor of Arts degree and a Masters degree in Engineering. He is also a CFA charterholder.

Data provided by Morningstar.

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