Head To Head

HEAD-TO-HEAD: JP Morgan AM versus Schroders

FSA compares two Japan equity products: The JP Morgan Japan Equity Fund and the Schroder ISF Japanese Equity Fund.

by Francis Nikolai Acosta 11 September 202019 October 2022

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Samuel Lo, Morningstar

INTRODUCTION

Investors are pulling out from Japan-focused equity funds globally, with the products having net outflows of $735m this year ending July, according to data from Morningstar Direct.

“We are seeing some outflows from the asset class this year, which is a continuation with what happened last year,” Samuel Lo, Hong Kong-based analyst for manager research at Morningstar, told FSA.

“One of the reasons is that the Japanese market has been trailing behind the world market. Especially after the Covid-19 meltdown, the rebound is much stronger for the global index.”

So far this year, the MSCI Japan Index continues to be in negative territory and has performed -1.39%, which compares with the positive 1.69% return of the MSCI All Country World Index, according to data from FE Fundinfo.

However, not all companies in Japan have performed negatively. For example, growth-oriented companies have provided at last high mid-to-high single-digit returns, with the MSCI Japan Growth Index performing 7.10% this year, FE data shows.

Against this backdrop, FSA asked Lo to compare two Japan equity products: The JP Morgan Japan Equity Fund and the Schroder ISF Japanese Equity Fund.

	JP Morgan AM	Schroders
Size	$5.4bn	$1.6bn
Inception	2002	2016
Manager	Nicholas Weindling, Miyako Urabe, Shoichi Mizusawa	Kazuhiro Toyoda
Three-year cumulative return	44.76%	2.71%
Three-year annualised return	13.17%	1.00%
Three-year annualised alpha	10.37	-1.88
Three-year annualised volatility	19.39	18.67
Morningstar analyst rating	Bronze	Neutral
Morningstar star rating	*****	**
FE Crown fund rating	****	**
OCF	1.80%	2.35%

Source: Morningstar, FE Fundinfo

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