Smith & Williamson Far Eastern Income and Growth Fund B

Asia Equities

Rated Fund 2018-19. Targets both growth and income

Smith & Williamson Far Eastern Income and Growth has had a disappointing year since becoming one of our Rated Funds in 2018. However, this is due to its lower allocation to better-performing Japanese equities than to stronger performers in the fund’s peer group.

It has a reasonable yield of 2.2%, paid annually, and has beaten its MSCI Pacific benchmark over three- and five-year periods.

As the fund’s name suggests, it seeks both income and long-term capital growth by investing in the Far East (Asia Pacific) region, including Japan, Australia and India. Japan is its largest country weighting, but it has almost 5% less in the country than the index.

The fund was launched almost 30 years ago, yet it remains a tiddler at around £38 million. It only started targeting income in 2013, when it changed its name from Smith & Williamson Far Eastern Growth Trust to reflect a change to its investment objective.

Its manager, Jane Andrews, has been actively involved in investing since the 1980s. She has been this fund’s manager since she joined Smith & Williamson in 1996.

Far Eastern Income and Growth has around 70 holdings, typically in high-quality firms operating in niche markets with structural growth potential. Andrews says these companies are more in charge of their own destinies than those producing undifferentiated or commoditised products, as there is regional and global oversupply.

She has a bias towards medium-sized companies, which she expects to be important drivers of longer-term returns. At a sector level, the fund is tilted away from banks, as Andrews finds large Australian banks unattractive.

Narrative and ratings content all as of January 2019.

See all Money Observer rated funds
Name
Smith & Williamson Far Eastern Income and Growth Fund B
Manager
Smith&Williamson Fund Administration Ltd
Type
Unit Trust
ISIN
GB00B4NXPJ75
Sector
Asia Pacific Including Japan
Launched
08/06/2011
OCF
0.77 %
Risk Rating
4
3 Year Sharpe
0.75
3 Year Alpha
0.60
Yield
2.3 %
Benchmark
MSCI AC Pacific GR USD
The objective of the Trust is to achieve both an income yield and long term growth of capital, primarily through investment in the Far East and Pacific Basin region, including Japan, Australia and India. This will be achieved by investing, almost exclusively, in companies that are incorporated in or listed on exchanges in these regions. The Manager may also, from time to time, invest in transferable securities, money market instruments, warrants, collective investment schemes, deposits, cash and near cash, smaller companies and new issues, when market conditions dictate. In light of extreme market conditions, the Manager may raise or reduce the liquidity of the Trust from normal working levels. The Manager may use derivatives for efficient portfolio management.
Holding %
Daiichi Sankyo Co Ltd 4.13 %
Keppel DC REIT Units Real Estate Investment Trust Reg S 3.23 %
Housing Development Finance Corp Ltd 3.07 %
Tencent Holdings Ltd 2.77 %
Taiwan Semiconductor Manufacturing Co Ltd 2.60 %
HDFC Bank Ltd 2.29 %
Alibaba Group Holding Ltd ADR 2.24 %
Ping An Healthcare And Technology Co Ltd Ordinary Shares 2.17 %
Keyence Corp 2.17 %
China Mengniu Dairy Co Ltd 2.14 %
Region %
Asia - Developed 33.15 %
Japan 30.21 %
Asia - Emerging 27.86 %
Australasia 8.78 %
Sector %
Technology 23.99 %
Industrials 16.91 %
Financial Services 16.03 %
Real Estate 11.03 %
Consumer Defensive 10.71 %
Healthcare 7.62 %
Consumer Cyclical 6.91 %
Communication Services 5.53 %
Name
Smith&Williamson Fund Administration Ltd
Address
EC2R 6AY, London, United Kingdom
UCITS
Yes
Legal Structure
Unit Trust

Managers

Jane Andrews
Joined 11/04/1996

Jane joined Smith & Williamson in 1996 and has managed the Smith & Williamson Far Eastern Growth Trust for over 15 years. She also manages the Smith & Williamson Oriental Growth Fund. Jane’s career began with Midland Bank working on Asian investments for an international pension fund. In 1987 she moved to John Govett to manage the Pacific Income Fund, winning a performance award in 1988. A tenure at CIM fund managers, where she ran dedicated Japanese & Asian pension funds, preceded her career at Smith & Williamson. Jane is also involved in the monthly strategy meetings advising on Far Eastern Markets.

Data provided by Morningstar.

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