JPMorgan Emerging Markets underperforms, bailed out by discount narrowing – JPMorgan Emerging Markets says that the year to 30th June 2017 was another positive one for investors in emerging markets, with the benchmark index, the MSCI Emerging Markets Index with net dividends reinvested, in sterling terms, returning +27.4%. The return on net assets, whilst positive in absolute terms, was behind the benchmark at +23.4%. Discount narrowing meant that the return to shareholders was in line with the benchmark at +27.3%, reflecting a narrowing of the discount from 13.2% to 10.5% over the year. The Board proposes to increase the dividend from 9.0p to 11.0p this year.
The manager’s report doesn’t have much attribution analysis. he says “We know that we will not beat the index every year and experience tells us that we will find it harder to do so in periods when the absolute returns are strongly positive, because lower quality companies tend to do better during cyclical upturns; those are exactly the conditions we have seen during the last financial year, notably in markets like Korea, where the Company’s lack of exposure has been a drag on performance.”
There is a much more detailed statement on the art of managing money which expounds on similar statements made last year.
JMG : JPMorgan Emerging Markets underperforms, bailed out by discount narrowing