Here you can find insights, thought leadership and market commentaries, compiled by our global investment teams.
In the following podcast, Tom Wildgoose, co-manager of the Nomura Global High Conviction Fund joins Interactive Investor’s head of markets Richard Hunter to talk about why the fund avoids style bias and focusing on fewer stocks allows the team to concentrate on the best ideas.
Our recent commentaries on the Japan equity market have highlighted some of the investment themes that have shone during this crisis. This month, we will look at quality companies that are taking steps to emerge even stronger. One common characteristic seems to be that companies which have been well and responsibly managed in the past are likely to have retained or gained goodwill during the crisis. In a postpandemic era, we believe a shift to more responsible management with a degree of financial conservatism is likely to become an increasingly common theme.
The case for investing in Japan has always relied on its many world-leading companies. In times of heightened uncertainty and acute economic stress, we believe quality companies that are adaptive, resilient and innovative will emerge even stronger. This pandemic will test their competitiveness, but those true winners will continue to reign. From a growth portfolio manager’s perspective, our objective is to identify these winners in the Japan equity market that are adapting and strengthening their businesses under challenging conditions.
The following report highlights how companies in our Japan High Conviction portfolio are adapting, and even thriving, during the current crisis. From cutting edge factory automation, medical equipment, online medical services, and specialised e-commerce companies that can benefit from the `Stay-at-Home` economy, to consumer staples sectors such as Asia`s leading producers of personal hygiene and baby care products, many stocks in the portfolio are thriving. Investors are likely to be attracted by their sometimes unique strengths in a challenging business environment.
In 2018, Fixed Income markets fell and many competitor funds lost value for their clients. In 2019, markets were positive. Finding a manager that can navigate through both these very different market environments is critical for any medium to longer-term investors.
As the year draws to a close, the TOPIX index in Japan is currently showing a gain of around 14% for the year in local currency terms, slightly better than our December 2018 forecasts. For most of 2019 the Japanese equity market has been driven by global, ‘big picture’ issues, most notably, the twists and turns in the long-running US-China trade dispute, the outlook for growth around the world and the overall direction of monetary policy.