BAILLE GIFFORD JAPAN: A trust that aims to grow savers’ money over the long term
The Japan Trust from Scottish fund manager Baillie Gifford aims to grow savers’ money over the long term
What does it do? The Japan Trust from Scottish fund manager Baillie Gifford aims to grow savers’ money over the long term, rather than focusing on giving them an income.
It primarily buys shares in small and medium Japanese firms, which are thought to have above-average growth prospects.
What does the manager invest in? Japanese investment giant Softbank is the trust’s largest holding, while electricals firm Sony also appears in the top ten.
What do the experts like? Juliet Schooling Latter, of Fundcalibre, says: ‘The trust has always been reasonably priced relative to peers, but from January 1 this year the fees have been further reduced.’
Low fees aren’t the only draw. Japanese companies have historically offered ‘exceptional growth opportunities with sustainable business models and strong competitive advantages’.
Any downsides? The focus on smaller companies can cause some volatility in the fund’s performance, Schooling Latter says, and its use of debt to help it buy more shares means that gains are amplified, but so is bad performance.
The trust is at the higher end of the risk spectrum, so won’t be suitable for all investors.