Page 21 - DIY Investor Magazine | Issue 29

Weindling emphasises that there is nothing inherently different or special about investing in Japan, only that: ‘The same trends are apparent here as everywhere else, even if things take longer to play out.
This creates tremendous opportunity for long-term active fund managers.’
THE SEARCH FOR LONG-TERM GROWTH
Having such deep research resources - and diverse opinions across the team - are invaluable assets in the search for long- term growth.
Being such a vibrant, yet under-researched market helps the team to find exciting prospects, as does the lack of depth in sell-side coverage, especially in the mid- and small-cap space.
This hands JFJ a healthy competitive information advantage.
The team concentrates its research on companies with great growth prospects over the next three, five or ten years which underpins the trust’s bottom-up strategy while neatly mirroring its growth over the last decade.
JAPAN IS AN UNDER RESEARCHED MARKET
Sources: J.P. Morgan Asset Management, Jefferies, Factset, data as of 31 December 2020.
* The base universe for this analysis is all companies listed in the US, Europe and Japan with market cap more than USD 10 million, and 3 month average daily turnover more than USD 0.1 million.
‘TO WATCH A STOCK GO FROM SMALL TO MEGA CAP WHILE THE INVESTMENT CASE PLAYS OUT AS WE HOPED IS VERY SATISFYING,’
FINDING GEMS IN THE JAPANESE MARKET
Every year in Japan, 80-100 new companies list - often early in their lifecycle – and the JFJ team is positioned to track intriguing start-ups and meet companies pre-IPO.
‘Every meeting is an education,’ says Weindling. ‘In a single day I can go from discussing telemedicine to adult diapers to pet insurance!’
The team relishes uncovering gems that achieve greatness. Weindling highlights the fund’s holding in M3, a platform for
drug companies to market their drugs to doctors, which is up multiple times since first purchased: ‘To watch a stock go from small to mega cap while the investment case plays out as we hoped is very satisfying,’ he says.
Another star performer is all-in-one shopping app and payment platform, BASE, likened to a combination of Shopify, Etsy and Stripe, founded in 2012 and now a domestic market leader which experienced explosive growth with the shift to online commerce during the coronavirus pandemic.
Having ‘boots on the ground’ proved an invaluable advantage during this period, as the team could still meet companies face-to-face while other asset managers have been restricted by the curbs on international travel.
21 DIY Investor Magazine | Jun 2021