1-year return: 17.7% | 3-year return: 60.6%
Veritas Asian has been an award winner for the past four years. It was named Best Asia Pacific fund in 2015, highly commended in this category in 2016, winner in 2017 and it takes the top spot again in 2018. It has also been a Rated Fund since 2016.
Although it suffered a period of weaker performance in 2016/17, when it underperformed the IA Asia Pacific Excluding Japan sector and sank to the third quartile of its peer group, it is a top performer over the longer term.
Ezra Sun, a manager with more than two decades of Asia equities experience, has run the £1.2 billion fund since its inception in 2004. He is based in London and heads up the Asia equity team consisting of three analysts, all based in Hong Kong. They communicate on a daily basis to exchange ideas and implement investment decisions. Sun uses a thematic approach to drive stock selection.
Assets are allocated between two broad sleeves depending on market conditions. The core portfolio typically accounts for 25 to 65 per cent of assets and is increased when the manager has a cautious market outlook. It consists of steadier, often high dividend-yielding companies that tend to reflect an identified structural growth theme. The remainder is invested in shorter-term trading opportunities and seeks to capitalise on market inefficiencies and earnings momentum.
HIGHLY COMMENDED FUND
JPM Asia Growth
1-year return: 19.2% | 3-year return: 57.7%
Despite short periods when this fund has slipped from first to second quartile among its peer group, its solid and consistent longer-term performance has clinched its highly commended status.
The fund benefits from the stewardship of Joanna Kwok and Mark Davids, both of whom have more than 20 years of investment experience. They are able to draw on a well-resourced emerging markets and Asia Pacific team at JPMorgan.
The portfolio contains up to 60 names, typically structural growth ideas – companies that boast quality franchises and consistent earnings streams. The managers build the portfolio based on the convictions of country specialists responsible for single-country strategies across the region, and those of sector analysts. The conviction-based nature of the fund is evident in its active share of more than 70 per cent.
At the end of March its largest regional weighting was to China, which accounted for 38 per cent of the fund’s £259 million of assets, while tech stocks and financials made up one-third each on a sector basis.