Fidelity Japan Trust

Investment summary

Fidelity Japan Trust (FJV) has recovered well in NAV terms from the global equity sell-off in the last quarter of 2018, which negatively affected its FY18 performance. Manager Nicholas Price says that the sharp de-rating of Japanese equities (which has only partly reversed as share prices have rebounded) means he is able to find many attractive companies trading at unwarranted discounts. The Japanese equity market is extremely under-researched compared with other major developed markets, and the input from Fidelity’s large, locally based analyst team, together with Price’s own research, makes FJV well-placed to capitalise on investment opportunities that the majority of (particularly overseas) investors may have overlooked. FJV’s multi-cap portfolio continues to have a natural bias towards smaller and mid-cap stocks, with Price seeking reasonably priced companies that have high returns on equity and a solid three- to five-year growth outlook.