Baillie Gifford Shin Nippon PLC
Launched in 1985, the Baillie Gifford Shin Nippon trust aims to provide long-term capital growth by investing in smaller companies listed on the Japanese stock market. Shin Nippon means ‘new Japan’ and this trust focuses on emerging or disrupted sectors, where the manager sees innovative growth opportunities. The team are prepared to bide their time while these companies reach their full potential and, while the trust can be highly volatile, patient investors have been richly rewarded.
Our Opinion
Fund Manager
Expand
Fund Manager
Close
Praveen is an investment manager in the Japanese Equities Team at Baillie Gifford. He manages the Japanese Smaller Companies Fund, related Japan Small Cap Strategy segregated accounts, and the Shin Nippon Investment Trust Plc, and is the deputy manager of the Japan Trust Plc. He is also a founder and member of the International Smaller Companies Portfolio Construction Group. Prior to joining Baillie Gifford in 2008, Praveen worked at FKI Logistex. He graduated with a BEng in Computer Science from Bangalore University in 2001 and completed an MBA at the University of Cambridge in 2008.
Praveen is an investment manager in the Japanese Equities Team at Baillie Gifford. He manages the Japanese Smaller Companies Fund, related Japan Small Cap Strategy segregated accounts, and the Shin Nippon Investment Trust Plc, and is the deputy manager of the Japan Trust Plc. He is also a founder and member of the International Smaller Companies Portfolio Construction Group. Prior to joining Baillie Gifford in 2008, Praveen worked at FKI Logistex. He graduated with a BEng in Computer Science from Bangalore University in 2001 and completed an MBA at the University of Cambridge in 2008.
Read More
Risk
Read more
Back
Fund Performance
Close
Risk
Close
Quote from the Fund Manager
We invest in high quality, disruptive and rapid growth businesses that are targeting large-end markets and run by young and dynamic entrepreneurs.
Praveen Kumar
Lead Manager
Investment process
Praveen aims to identify smaller companies that he believes offer above-average growth prospects. He targets firms with innovative business models and the potential to disrupt their industries; those that challenge traditional Japanese practices; and those with strong overseas growth prospects. Sectors that are of particular interest to the team include Japan's emerging services industry, which is fast expanding due to government deregulation and corporate outsourcing, as well as technology and healthcare.
Praveen has a three- to five-year time horizon when selecting companies and does not rely on short-term valuations. He is happy to hold some stocks that may be classed as overvalued by other managers, as long as they meet his investment quality criteria.
Risk
Investing in Japan always carries high risk, which can be accentuated in this trust as it tends to invest mainly in smaller-sized companies that are traditionally more volatile than larger companies. However, Praveen manages this risk by ensuring he holds a minimum of 40 stocks (normally between 40 and 75), as well as making sure he thoroughly researches and understands the businesses in which he invests. Currency fluctuation is another risk that investors need to consider. Gearing can also increase the trust’s volatility.
ESG
ESG - Limited
Praveen takes a long-term approach, looking for growth opportunities with firms that are likely to be future leaders. He believes that this long-term approach incorporates a natural bias towards sustainable business models, however this is not a formal policy of the philosophy or process. Material ESG issues that are identified in the analysis will be considered as possible reasons to not invest, but this will be on a case-by-case basis, rather than a systematic approach. There is a strong focus on governance though, with Praveen and the team having regular engagement with the management of companies already held in the fund and those of prospective holdings. This is especially important when considering the smaller size of many of the companies held.
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 nor 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. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.