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JOHCM Asia Ex Japan

Elite Rated by FundCalibre

Singapore-based Samir Mehta and Cho-Yu Kooi manage this unconstrained, high-conviction fund investing in companies across all market capitalisations. It typically holds around 45 stocks. The core of the fund is made up of high quality, sustainable growth stocks (minimum 75%), while up to 25% is invested in companies more sensitive to the economy.

Company Description

JO Hambro Capital Management (JOHCM) was established in 2001. It only hires managers with a proven track record and prides itself on removing bureaucracy and taking an entrepreneurial approach. Funds are run as separate entities and there are no house views. Each fund manager has their own unique franchise, receiving a performance fee, which aligns them with investors.

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Fund Manager

Samir Mehta has been senior manager of this fund since its launch in September 2011 and has more than 25 years of investment experience. He is a CFA charterholder and previously managed Asian Pacific mandates at Lloyd George Management (LGM).

Cho-Yu Kooi, who has more than 20 years of investment experience, became co-manager of the fund in July 2015, having joined the company in 2011. She is also the lead manager on the JOHCM Asia Ex Japan Mid and Small Cap fund.

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The Black Swan author, Nassim Taleb, says financial agents should have 'skin in the game' – much of my personal wealth is in my fund. This accentuates my focus on avoiding capital loss for my investors and contributes to my low volatility approach.

Samir Mehta - Fund Manager

The Investment Process

Samir and Cho-Yu are fundamental bottom-up stock pickers. They like companies that can do well in all market conditions. The team uses a four-step process to identify good investments: a quality screen; an eight-year historical exploration of the company financials; a subjective company analysis, alongside a financials forecast and scenario analysis; and then finally a valuation stage, where consistency of returns is key.

They like consolidating industries such as technology and healthcare, focusing on those with the ability to consistently generate high returns on capital invested (minimum 15%). They are not afraid to pay up for quality or growth.

Risk

This is a concentrated, unconstrained fund mostly investing in relatively immature stock markets. As such, it should be treated as a high-risk investment. The team conduct detailed analysis as to how their stocks have performed in previous down markets and will not hesitate to hold cash if the managers feel markets are overvalued. The fund’s historic volatility has been lower than average in its sector. Investors should also be aware of the currency risk.

Our Opinion

This high-conviction fund has an excellent, well-defined process, which has consistently proven itself since the fund launched. Both managers have experience of past crises and are not afraid to go against the grain in their selection. The fund’s relatively small size gives them great flexibility. We believe this is a core Asian holding.

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©2014 FundCalibre Limited. All Rights Reserved. The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not ,guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund or of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating.