Head To Head

HEAD-TO-HEAD: JP Morgan AM vs Schroders

FSA compares the JP Morgan Japan Equity Fund and the Schroder ISF Japanese Opportunities Fund.

by Francis Nikolai Acosta 10 August 201810 November 2020

Don Yew, Morningstar

Japan equities have fallen out of favour this year after generally strong performance last year, according to Don Yew, Singapore-based analyst for manager research at Morningstar.

Year-to-date, The MSCI Japan Index has fallen -1.16% compared to 24.39% in 2017, according to data from FE Analytics.

Like other markets, the negative sentiment in Japan equities can be attributed to the US-China trade war, Yew said.

Countries that have large trade surpluses, which include Mexico, Japan and Germany, are likely to be negatively affected by an all-out trade war, according to UBS Wealth Management.

Fund managers have also downgraded their views on the asset class. For example, State Street Global Advisors has reduced its position in Japan for its multi-asset portfolios, while Blackrock does not see any catalyst for the market to outperform.

Against this backdrop, FSA asked Morningstar’s Yew to look at two Japan equity funds: the JP Morgan Equity Fund and the Schroder ISF Japanese Opportunities Fund.

	JP Morgan fund	Schroders fund
Size	¥500.5bn ($4.5bn)	¥213.13bn ($1.92bn)
Inception	Nov 1988	Dec 2006
Manager	Miyako Urabe, Nicholas Weindling, Shoichi Mizusawa	Ken Maeda
Three-year annualised return	3.58%	1.62%
Three-year annualised alpha*	3.90	2.00
Three-year volatility	17.29	14.94
Morningstar analyst rating	Bronze	Neutral
Morningstar star rating	******	****
FE Crown fund rating	******	****
OCF	0.97%	1.30%

Source: Morningstar, FE Analytics

* Over a given period of time, a positive alpha of 1.0 means the fund has outperformed its benchmark index by 1%

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