Fund added to the AJ Bell Favourite funds list


We’ve added the Jupiter Japan Income fund.

What is the AJ Bell Favourite funds list?

The AJ Bell Favourite funds list is designed to lighten your research load. To narrow the field, we’ve attempted to select a high-quality shortlist of funds that we think are capable of delivering their objectives over the long term. To make the list, each fund needs to pass a robust selection process.

What have we changed?

When we add a fund to the Favourite funds list, we intend for it to remain there for the foreseeable future. When we decide to remove a fund, it’s usually because something material has changed on its mandate – such as the fund manager departing. This happened with a fund on our list, Schroder Tokyo, in April 2019. Hearing that fund manager Andrew Rose was due to retire, and knowing nothing about the incoming fund manager, we decided to remove the fund.

Before we add a fund to our list, we make sure it passes all our selection criteria. Identifying a suitable core Japanese equity fund is made trickier by the fact they are few and far between. Most funds in Japan have a strong ‘value’ or ‘growth’ stance. (A ‘core’ fund, by contrast, is one that is more benchmark-aware, and less targeted towards any one particular investment style.)

That said, we’ve recently identified and added a premium-yielding Japanese core-growth fund to our list – Jupiter Japan Income.

The objective of Jupiter Japan Income is to achieve a higher growth and a larger dividend yield than the wider Japanese market. It’s managed by Mitesh Patel and Dan Carter – the latter, who has been involved with the fund for over a decade, leads the strategy. They believe in the fundamental principle that future distributions create shareholder value, which is why the fund’s investment process is primarily bottom-up driven. The fund is managed in a concentrated manner with around 40 stock positions.

As a recap, the other Japanese funds that are already on the list are Man GLG Japan CoreAlpha (a deep value strategy) and Baillie Gifford Japanese (a growth strategy), both of which we continue to hold high conviction in. We believe that Jupiter Japan Income enhances the AJ Bell Favourite funds selection as it operates in a different area of the market to these two funds.

In our view, it’s important for the AJ Bell Favourite funds list to be diverse – spanning various sectors and investment styles – to give you plenty of choice. A consequence of this diversity is that it isn’t possible for every fund on the list to perform well at any one time. This is because market conditions which act as tailwinds for some types of funds may be headwinds for others, and vice versa.

We hope you find this update useful. Please remember that it falls to you to monitor and manage your own investments and to make any changes you think are necessary. Keep in mind this is information only, and not a personal recommendation to buy or sell any of the funds referenced above.

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Written by:
Simon Molica

Simon Molica is a fund manager in the active portfolio team at AJ Bell. Before joining AJ Bell, Simon worked for an investment management company in the role of Portfolio Manager, running a variety of investment propositions – including the active range of their Managed Portfolio Service. Prior to this he worked at a global consulting firm and one of the world’s largest banking and financial services organisations. Simon holds a BSc in Mathematics with Management Studies, with honours, from the University of Sussex. He also holds the Investment Management Certificate.