Why invest in the Rathbone SICAV Asia Equity Fund?
- Index agnostic mindset – We assess risk as the potential for permanent loss of capital. Alongside our focus on capital preservation, we seek to minimise the portfolio’s absolute volatility and drawdown potential.
- Truly active management – We take a high-conviction, fundamental bottom-up driven approach, and typically invest in 25-35 companies across public Asia Pacific (ex-Japan) markets. As a result of our benchmark-agnostic approach our strategy tends to have a high active share relative to its MSCI All Country Asia ex-Japan benchmark.
- Investing in quality – We implement a ‘quality growth’ style bias. We define quality companies as those with high governance standards, that look after all their stakeholders, and which are managed by strong management teams. In our view, quality companies have purposeful business models that seek high and stable returns, benefit from strong balance sheets and cultures of constant innovation, and are highly cash generative.
- Investing over the long term – Our strategy takes a long-term approach to investing, often with a horizon of five to seven years, which we regard as consistent with the timeframes of most companies’ corporate strategies, however there is no guarantee that a positive return will be achieved over this time period. In our view, investors should adopt a similarly long-term time horizon to allow investment theses to play out and allow for the full capture of portfolio companies’ potential upside.
- Proprietary research – Fund manager Lisa Lim conducts research using her own robust research methodology which was designed, tested and refined over two decades across multidisciplinary settings. In-depth research is conducted at the industry, sector and company level, and is not reliant on sell-side input. Primary data and observations are derived from a wide range of sources, for example, company data, management interviews, stakeholder interviews, site visits, and scientific and academic journals. Crucially, we do not rely on sell-side recommendations.
This is a marketing communication. Please refer to the fund prospectus and KIID before making any final investment decisions.
Key documents*
More about the Rathbone SICAV Asia Equity Fund
The Asia Pacific ex-Japan region is the world’s economic growth powerhouse. It dominates global GDP growth, and its young and growing population is driving a structural shift in demand. Most of the world’s population lives within the ‘Valeriepieris Circle’ with a radius of less than 4,000km, centred in Myanmar, covering most of Asia.
Despite an ageing population in parts of Asia, including China, hundreds of millions of people elsewhere in the region, such as Southeast Asia and India, will continue to join the global middle class in coming years. This creates a vast pool of potential purchasing power which we believe will continue to drive the region’s structural growth story. On top of Asia’s favourable demographics, and its decades of investment in people, science and technology, many public and private Asian institutions are emerging as world-class innovators. Asian countries, including China, India, South Korea and Japan, are key contributors in both top journal citations (for example Nature Index) and global patent application. As the world’s economic and innovation centre of gravity shifts towards Asia Pacific, companies in the region are no longer playing catch-up with their global peers. In many cases, they are leading the way with innovative products, solutions and services, making their mark on the global scene.
We deploy what we regard as an index agnostic mindset to build our high-conviction portfolio. We view our investment approach as disciplined, highly active and benchmark-agnostic investment. Our objective is long-term capital growth over five to seven years. We expect the primary drivers of our investment returns to stem from the earnings, cashflow and dividend growth of the companies whose shares we own.
We have a natural bias towards what we regard as high-quality companies. In our view, key quality characteristics include purposeful and strong business models in sectors and industries that we believe benefit from long-term structural growth drivers. We define a high-quality company as one with high governance standards, and which respects and looks after all its stakeholders. In our view, a high-quality business should also have a strong executive management team and a business model that seeks high and stable returns, while also benefiting from a culture of constant innovation and a strong balance sheet.
Using a robust research methodology focused on company fundamentals, we select and invest in what we regard as purposeful, high-quality companies which also aim to promote and generate positive outcomes for societies in Asia and globally. We pay close attention to market valuations and conduct rigorous fundamental valuation analysis on selected companies. We aim to acquire these companies’ shares at attractive discounts to their intrinsic value, consistently seeking to incorporate a margin of safety.
The objective of our fund is to achieve long-term capital growth. The fund seeks to achieve its objective by investing in the shares of companies in the Asia Pacific region (excluding Japan), or from companies which generate a significant amount of their business from the region. The fund may invest in the shares of companies of any market capitalisation and in regional markets at any stage of development. We compare our fund against the MSCI AC Asia Pacific ex-Japan Index, however, we have significant freedom to deviate from it. You can find our fund’s full objective and investment policy in our Key Information Document (KID), as well as information about the risks involved in investing in emerging markets, where the legal, judicial and regulatory infrastructure is still developing and there is much legal uncertainty both for local market participants and their counterparties.
Meet the fund manager
DR Lisa Lim
Head of Asia ex-Japan Equities and fund manager