Edison issues review on Atlantis Japan Growth FundSource: RNS
London, UK, 20 October 2022
Edison issues review on Atlantis Japan Growth Fund (AJG)
Atlantis Japan Growth Fund (AJG) invests in a diversified portfolio of Japanese equities. Its bias towards high-quality, innovative growth and small-cap stocks has put performance under pressure this year. However, the fund has achieved its long-term capital growth objective, delivering an average annual NAV return of 9.7% over the past 10 years and outperforming its benchmark, the TOPIX, on this basis, over this period. This long-term track record attests to the stock selection skills of AJG's lead adviser, Taeko Setaishi. She believes that while further patience may be required, an eventual recovery in Japanese corporate earnings will be the catalyst for renewed interest in growth stocks and an associated improvement in AJG's performance.
Japan is a global leader in some key niche industries and Japanese stocks remain attractively valued versus global peers. AJG offers investors diversified access to some of Japan's most exciting and innovative companies, including under-researched and undervalued smaller-cap stocks. The fund's long-term track record of high absolute returns and outperformance is likely to appeal to investors seeking the diversification benefits of exposure to the Japanese market. AJG may also appeal to investors seeking a high, regular and predictable income. The fund offers a yield of 5.4% (based on the current share price and the four dividend payments due in respect of the financial year ended April 2022). This is the second highest dividend among the fund's AIC peers (see peer group comparison section). The Japanese yen has depreciated significantly in response to the widening differential between Japanese, US and UK interest rates, and any recovery in the currency will support returns for sterling-based investors. The fund is trading at a wider than average discount, potentially offering new investors an attractive entry point. There is scope for the discount to narrow as and when performance returns to form.
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