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The best performing Japanese funds of Q1

FSA highlights the best performing large cap Japanese equity funds of the first quarter of 2024.
pedestrians walking across with crowded traffic at Shibuya crossing square.Shibuya crossing is the busiest road crossing in the world. Shibuya, Tokyo, Japan,

Funds from Alma Eikoh, Goldman Sachs and SPARX are among the best performing Japanese equity strategies of the first quarter, according to data compiled from FE fundinfo.

Japanese equity markets continued to power upwards during the first quarter of 2024 after continued inflows and a strong earnings season from Japanese companies.

This comes on the back of the Japanese economy emerging from its multi-decade long struggle with deflation as real wages rise and the Bank of Japan cautiously shifts towards normal monetary policy.

After a breakout year in 2023, the Japanese equity market indices are on track for another strong year with double digit gains in the first quarter.

Adjusted for US dollars, the Nikkei 225 is up 12.37%, the MSCI Japan is up 11.92% and the TSE TOPIX is up 10.05% in the first three months of the year.

However, there are a handful of actively managed strategies that were able to outpace the gains of the wider indices in the first quarter. 

Below are the top 10 performing Japanese large cap equity funds for the first three months of the year, based on data from FE fundinfo*

FundQ1 2024 Return (%)
Alma Eikoh Japan Large Cap Equity16.55
GS Japan Equity Partners Portfolio16.34
RBC (Lux) Japan Ishin16.04
E.I.Sturdza Nippon Growth15.64
BCM Vitruvius Japanese Equity15.52
SPARX Japan14.97
Franklin Japan14.81
Matthews Japan14.77
Nikko AM Japan Value14.37
Janus Henderson Horizon Japan Opportunities13.59

The best performing Japanese equity fund in the list above was the Alma Eikoh Japan Large Cap Equity strategy, with a 16.55% return for the first quarter.

Managed by James Pulsford and Tom Grew, the $1bn strategy runs a concentrated portfolio of roughly 30 large cap stocks.

The investment managers focus on bottom up stock picking with an emphasis on companies with strong cash flow return on investment. It has a notable overweight towards financials.

The Goldman Sachs Japan Equity Partners Portfolio was the second highest performing strategy, with a 16.34% return for the quarter.

The $3.7bn portfolio is run by Goldman Sachs head of Japan Equity Ichiro Kosuge, who leads a team of five. This was another concentrated strategy with 34 holdings.

This strategy is underweight financials, and overweight the information technology and health care sectors.

Another notable strategy in the list above was the $1bn SPARX Japan fund run by Masakazu Takeda.

Like the other two strategies, the manager runs a concentrated approach with just 25 individual positions where its top-10 account for almost 60% of the portfolio.

It employs a quality-growth investment style approach, and more recently has benefitted from its overweight positions in Tokyo Electron and other semiconductor-related names.

*The performance figures are based in US dollars. The data only includes funds that fall under the Singapore Mutual or Hong Kong Mutual equity sectors according to FE fundinfo data. Currency hedged strategies were excluded.

Part of the Mark Allen Group.