In the six months to 29 February 2016, The Baillie Gifford Japan Trust’s net asset value per share (after deducting borrowings at fair value) increased by 0.1% compared to a 1.0% increase in the TOPIX total return (in sterling terms). In yen terms though the TOPIX was weak, falling around 15% whilst the yen gained against sterling by roughly the same amount. The Company’s share price decreased by 1.3%.
Although the Company’s equity holdings outperformed the index during the six months, this was more than offset by the negative impact of the gearing for the portfolio as a whole. There were strong share price performances from stocks related to the sharing economy which helped performance. Next, an online property broker, aims to enter the market to compete with AirBnB. As hotel rooms have become scarcer and more expensive in Japan, the growing number of tourists will require more accommodation and they expect further regulatory changes to allow developments in accommodation as Tokyo looks forward to hosting world sporting events. Park 24, which operates car parking and car club services, has also been strong as their dominance in the car sharing space widens and the business becomes more profitable. The portfolio was also helped by the lack of holdings in the mega-banks, which have been weak since the Bank of Japan cut interest rates.
BGFD : Baillie Gifford Japan reports flat NAV