Man GLG Japan CoreAlpha Professional Class - Income (GBP)

Sell:232.00p Buy:232.00p Change:

5.10p (2.25%)

Prices as at 7 December 2021

Sell:232.00p

Buy:232.00p

Change:

5.10p (2.25%)

You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account

Prices as at 7 December 2021

Sell:232.00p

Buy:232.00p

Change:

5.10p (2.25%)

Prices as at 7 December 2021

You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account

The selling price currently displayed is higher than the buying price. This can occur temporarily for a variety of reasons; shortly before the market opens, after the market closes or because of extraordinary price volatility during the trading day.

Our view on this Fund

This fund is on the Wealth Shortlist of funds our analysts believe have the potential to outperform their peers over the long term. However, this is not a recommendation to buy.

Lead manager Stephen Harker and senior manager Neil Edwards will step down from this fund at the end of March 2021. Jeff Atherton, who's been a co-manager since 2011, has already taken over as lead manager, while Harker and Edwards remain co-managers for now. Atherton has 30 years' experience investing in Japan and analysing and researching companies based there. It means he has a deep understanding of the Japanese market.

A lot of experience will be lost following the departure of Harker and Edwards, and the fund will have less resource behind it. This has naturally dented our conviction.

That said, the remaining team has a strong pedigree investing in Japan and are focused on the job in hand. They're not involved in running other funds, and are dedicated to the Man GLG Japan CoreAlpha strategy.

The fund will remain on our Wealth Shortlist as we feel it's still in capable hands. Atherton is a highly experienced Japanese equities investor and we believe he can lead the team and fund successfully going forward. We will inform investors if our views changes.

Our view on the sector

Japan is home to some of the best-known businesses on the planet. Toyota, Honda, Panasonic, and Nintendo to name a few. There are also lesser-known businesses with the potential to be the household names of tomorrow. But years of sluggish growth put people off investing in the country. Former Prime Minister, Shinzo Abe, introduced policies designed to stimulate the economy and reignite interest in Japan's markets. Investor sentiment began to change but after 8 years at the helm, he announced his retirement and was replaced by Yoshihide Suga in September 2020. Suga's appointment initially offered the promise of fresh and progressive government policies and continued economic support. His tenure was dominated by the pandemic and he faced criticism over how he handled the virus. After one year in office, he stepped down as Prime Minister and has been replaced by fellow Liberal Democratic Party (LDP) member Fumio Kishida.

Performance Analysis

The fund has an excellent long-term track record. Since launch in January 2006 its returned more than the broader Japanese stock market. Our analysis puts this down to strong stock picking.

Investing in unloved companies won't always work though. It can take time for a company's share price to recover following a disappointment and shorter-term periods of weaker performance should be expected.

That's been the case in recent years. The team's investment style has largely been out-of-favour, and value companies performed particularly poorly since the start of 2020 amid the coronavirus crisis. The fund didn't hold up as well as we'd expect, given the type of companies it invests in. This suggests the managers' stock picking was weaker.

Investment Philosophy

Stephen Harker believes the best returns can be made investing in companies that are unloved, undervalued and overlooked. This is often called 'value investing'. Shares in these companies can usually be bought cheaply, though he'll only invest in companies if he thinks they'll return to favour again. If they do, their share price should rise.

Process and Portfolio Construction

The team starts by looking for the shares of companies that have been through a tough time. They like those that can be bought at a low price, which doesn't reflect the future growth potential of the business.

They'll look to hold onto the shares over the long term as it can take time for potential to be recognised and then patiently wait for them to recover. The team will slowly sell as the share price rises, or look to invest a little more if the share prices falls. If they feel a company has recovered or if better opportunities emerge, they'll sell and move onto the next investment.

Atherton and his team mainly invest in some of Japan's largest companies, but will also invest in medium-sized businesses if good opportunities emerge. They invest in a relatively small number of companies, meaning each one can have a big impact on the fund's performance. This is a higher-risk approach.

Please note the fund's charges can be taken from capital. This increases the yield, but reduces the potential for capital growth.

Manager Track Record Based on HL Quantitative Research

1Y 3Y 5Y 10Y ALL1Y 3Y 5Y 10Y ALL

Man GLG Japan CoreAlpha...
IA Japan

FROM: TO:

Fund Track Record

	07/12/16 to 07/12/17	07/12/17 to 07/12/18	07/12/18 to 07/12/19	07/12/19 to 07/12/20	07/12/20 to 07/12/21
Annual return	7.21%	-2.66%	3.22%	-13.70%	19.51%

Please remember past performance is not a guide to future returns. Where no data is shown, figures are not available. This information is provided to help you choose your own investments, remember they can fall as well as rise in value so you may not get back the original amount invested.

Fund Management Group Comment

GLG was founded in 1995 and it has established itself as one of the largest alternative asset managers in the world. GLG offers a diverse range of funds encompassing equities, fixed interest and alternative investments. In April 2009 GLG took over the London-based division of Societe Generale Asset Management (SGAM), which expanded GLG's investment capabilities and distribution network. In 2010 GLG was acquired by Man Group to create the world's largest listed hedge fund group.

Information about the fund

Fund manager biography

Manager Name:	Jeff Atherton
Manager start date:	21 March 2011
Manager located in:	London

Jeff is a Senior Portfolio Manager to the Japan CoreAlpha team. He has a BA in Economics from the University of Sheffield. Jeff started his career at Sun Life of Canada in 1987 and has been managing Japanese funds for over 20 years. He has held senior positions at Insight Investment, SGAM, TCW and Equitable Life. Most recently Jeff spent 5 years at Stratton Street Capital LLP where he was a partner and co-manager of their Japanese hedge fund strategies. Jeff joined GLG in March 2011.

Manager Name:	Adrian Edwards
Manager start date:	30 June 2014
Manager located in:	TBC

Adrian is a Portfolio Manager in the Japan CoreAlpha team. He has a BSc in Business Information Systems from Anglia Ruskin University and is a CFA charter holder. Adrian began his career in fund management at Stratton Street Capital LLP in January 2006 where he rose to the position of Assistant Fund Manager on the firm's Japanese and Asian synthetic warrant and Japanese equity hedge fund strategies. Adrian joined Man GLG in June 2014.

Manager Name:	Stephen Harget
Manager start date:	24 August 2015
Manager located in:	TBC

TBC

Manager Name:	Emily Badger
Manager start date:	24 August 2015
Manager located in:	TBC

TBC

Data policy - All information should be used for indicative purposes only. You should independently check data before making any investment decision. HL cannot guarantee that the data is accurate or complete, and accepts no responsibility for how it may be used. Benchmark data provided subject to this disclaimer.

You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account

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