CT (Lux) Japan Equities
This is a marketing communication. Please refer to the prospectus of the UCITS and to the KIID / KID before making any final investment decisions.
A high-conviction Japanese equity fund that invests in quality companies with durable competitive advantages and that aims to generate strong, sustainable returns.
Key reasons to invest
1. Strength of research:
Fundamental based research supplemented by quantitative, ESG and macro-economic assessment – analysing multiple sources of excess returns – provides us with a clear view of key stock performance drivers.
2. Stability of team:
There have been no departures from the team since inception in 2012 and this stability helps ensure the consistency and repeatability of the investment process.
3. All-cap strategy:
Proven ability to generate excess returns from stock selection across the whole market capitalisation.
Key facts
Fund inception date:
14 December 2023
Typical fund holdings:
30 to 60 companies
SFDR:
Article 8*
Daisuke Nomoto
Portfolio Manager
(since December 2023)
*The fund promotes environmental or social characteristics under Article 8 of the EU Regulation 2019/2088 on sustainability related disclosures in the financial services sector (SFDR). The decision to invest in the promoted fund should also take into account all the characteristics or objectives of the promoted fund as described in its prospectus. The fund’s sustainability related disclosures can be found on our website columbiathreadneedle.com.
Key risks
This fund is suitable for investors who can tolerate high levels of risk and volatility and have a long-term investment horizon. Investors could lose some or all their capital and should read the Prospectus for a full description of all risks.
Investment risks: Investment in equities, smaller companies, derivatives, portfolio concentration and Environmental, Social and Governance (ESG) criteria.
Investment objective & policy
To generate long-term capital growth by investing in a concentrated portfolio of Japanese companies in which the portfolio manager has a high conviction that the current price does not reflect the prospects for that business.
The fund is actively managed in reference to the MSCI Japan Index. The fund is not constrained by this benchmark and, in line with its active management strategy, portfolio holdings may deviate significantly from those of the index.
Our bottom-up stock picking approach that looks for companies across the market cap spectrum means we are well-placed to take advantage of the many opportunities available across the Japanese corporate landscape.
Investment approach
We look for quality companies with strong competitive advantages that can generate high or improving returns on capital and compound growth over the long term. The ability of these companies to sustain these high returns and above-average growth is often underestimated by the market, meaning potential winners trade at a discount to their intrinsic value and it’s this inefficiency that we are looking to exploit.
Our specialist Japan Equity team has day-to-day contact and collaboration with philosophically aligned equity teams, all which act as sources of idea generation and help the team in cross-checking companies in the portfolio and under consideration. Our deep research network is complemented by global central research and RI experts, all of which can contribute ideas and insights.
Bottom-up stock selection is the main driver of the investment process. Evaluating companies using fundamental research, supplemented by proprietary quantitative, ESG and macroeconomic tools – analysing multiple sources of excess returns – is more effective than any single approach because it yields a more comprehensive understanding of factors that drive performance.
Our investment process is centred around the premise of ‘no unintended bets’, where we seek an informed view for all companies within our investment universe, including a perspective of those we don’t hold. This is achieved through creating both upside and downside price targets for all companies within our defined universe. These targets become our ‘map’ to allocate capital during the portfolio construction stage, where high-conviction positions contribute most to portfolio risk.
There is a formalised sell discipline in place for the portfolio; so, if a stock declines by 15% from the purchase level or falls to the fifth quintile in the quantitative model, we put the stock under review with a bias to trim or sell out. Independent monitoring teams also help eliminate unintended risks, promote strong, consistent returns and ensure the strategy is aligned with its investment objective.
Clearly defined and repeatable process
Step 1
Define and evaluate investment universe
Key attributes for future outperformance
- All stocks typically >$3m average
daily volume - Quantitative screen
- Fundamental screen
Step 2
Conduct research & valuation analysis
Quality businesses at an attractive price
- Bottom-up research
- Intrinsic value estimate
Step 3
Portfolio construction
Allocate capital where you have conviction
- Concentrated and multi-cap portfolio
- Proprietary quantitative, macroeconomic assessment and ESG tools
- Risk budgeting
for conviction
Step 4
Risk monitoring & sell discipline
Checks and balances
- Independent risk monitoring
- Investment Oversight monitoring
- Formalised sell discipline
Meet the team
Simon Haines is a portfolio manager and with research responsibility for the industrials sectors and the Asia-Pacific region. Simon joined one of the Columbia Threadneedle Investments firms in 1999 as a trainee portfolio manager, progressing to portfolio manager in January 2005, where he managed the Threadneedle UK Mid 250 Fund and co-managed the Threadneedle UK Extended Alpha Fund. He has been a member of the investment community since 1999. He received a degree in biology from Oxford University. In addition, Simon holds the Chartered Financial Analyst® designation.
Alex joined the company in 2016 as a portfolio manager. He has research responsibility for Japan and currently manages a segregated Japan equity mandate. He also supports the Global desk with idea generation and analysis of Japanese companies across all sectors. Previously, Alex was a senior fund manager at Canada Life Investments, where he managed the Japan fund and supported the management of the U.S. and Global funds. He has been a member of the investment community since 2007. Alex has a BSc in Economics from the London School of Economics. In addition, he holds the Chartered Financial Analyst® designation.
Daisuke Nomoto is head of Japanese equities at Columbia Threadneedle Investments. Prior to his current role, he was a director and senior portfolio manager on the International Equity Team. Mr. Nomoto joined one of the Columbia Threadneedle Investments legacy firms in 2005.
Previously, Mr. Nomoto worked as an equity analyst at Putnam Investments. Prior to that, he held a variety of positions for Nippon Life Insurance, including four years as a senior portfolio manager and equity analyst at Nissay Asset Management, Tokyo, and five years as an equity analyst with NLI International.
Mr. Nomoto received a B.A. from Shiga University, Japan. He is a chartered member of the Security Analysts Association of Japan.
Fred Copper is the lead and senior portfolio manager on the Overseas Value Team for Columbia Threadneedle Investments. Mr. Copper joined one of the Columbia Threadneedle Investments legacy firms in 2005.
Previously, Mr. Copper was a senior vice president with Putnam Investments where he co-managed international and global value portfolios, and also served as the lead manager for a small-cap value portfolio. Prior to that, Mr. Copper was an assistant vice president with Wellington Management Company. He has been a member of the investment community since 1990.
Mr. Copper received a B.S. from Boston College and an MBA from the University of Chicago. In addition, he holds the Chartered Financial Analyst® designation.
Simon Morton-Grant is a Client Portfolio Manager within the Asia and Japan Equity teams. In this role he is responsible for providing detailed information on the company’s capabilities and investment views to existing and prospective clients as well as to consultants and other intermediaries.
He joined the company in 2017 as a graduate on the Investment 2020 programme before joining his current team in February 2018, having previously completed an internship at Morgan Stanley.
Simon has an MSc Finance & Investment and a BEng in Chemical Engineering from the University of Leeds.
Key documents
Full fund details
Insights
Japan’s decade of sustained momentum: is it here to stay?
Japan Equity: a strong track record in an exciting market
ESG Viewpoint: A deep dive on Japan’s low carbon transition
Important information
Your capital is at risk. This financial promotion is issued for marketing and information purposes only by Columbia Threadneedle Investments.
The Fund is a sub-fund of Columbia Threadneedle (Lux) I, a Luxembourg domiciled investment company with variable capital (“SICAV”), managed by Threadneedle Management Luxembourg S.A.
The SICAV’s current Prospectus, the Key Investor Information Document (KIID)/Key Information Document (KID) and the summary of investor rights are available in English and/ or in local languages (where applicable) from the Management Company Threadneedle Management Luxembourg S.A., International Financial Data Services (Luxembourg) S.A., your financial advisor and/or on our website www.columbiathreadneedle.com. Threadneedle Management Luxembourg S.A. may decide to terminate the arrangements made for the marketing of the SICAV. Pursuant to article 1:107 of the Act of Financial Supervision, the sub-fund is included in the register that is kept by the AFM. Past performance is calculated according to the BVI method in Germany.
These documents are available in Switzerland from the Swiss Representative and Paying Agent CACEIS Investor Services Bank S.A.. Esch-sur-Alzette, Zurich Branch, Bleicherweg 7, CH 8027 Zurich.
This material should not be considered as an offer, solicitation, advice or an investment recommendation. An investment may not be suitable for all investors and independent professional advice, including tax advice, should be sought where appropriate. This communication is valid at the date of publication and may be subject to change without notice. Information from external sources is considered reliable but there is no guarantee as to its accuracy or completeness.
In Spain, Columbia Threadneedle (Lux) I is registered with the CNMV under No. 177. The Fund is a non-Spanish collective investment scheme duly registered with the CNMV for marketing in Spain. The fund should be subscribed to through locally authorised appointed distributors. Investors must read the relevant Prospectus and KID for each fund they want to invest before subscribing. All other statutory documentation, as well as the NAV can be obtained from www.columbiathreadneedle.com.
In the EEA and Switzerland: Issued by Threadneedle Management Luxembourg S.A. registered with the Registre de Commerce et des Sociétés (Luxembourg), Registered No. B 110242, 44 rue de la Vallée, L-2661 Luxembourg, Grand Duchy of Luxembourg. In the UK: Issued by Threadneedle Asset Management Limited. Registered in England and Wales, No. 573204. Registered Office: 78 Cannon Street, London EC4N 6AG, United Kingdom. Authorised and regulated in the UK by the Financial Conduct Authority. In the Middle East: This document is distributed by Columbia Threadneedle Investments (ME) Limited, which is regulated by the Dubai Financial Services Authority (DFSA). For Distributors: This document is intended to provide distributors with information about Group products and services and is not for further distribution. For Institutional Clients: The information in this document is not intended as financial advice and is only intended for persons with appropriate investment knowledge and who meet the regulatory criteria to be classified as a Professional Client or Market Counterparties and no other Person should act upon it.
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