JPMorgan Global Emerging Income lags on technology underweight – JPMorgan Global Emerging Income reports that, for the year ended 31 July 2017, it generated a total return on net assets of +16.4%. The total return to shareholders was +14.4% reflecting a widening of the share price discount to net asset value from 1.5% to 3.4%. In comparison, the benchmark, the MSCI Emerging Markets Index with net dividends reinvested (in sterling terms), recorded a total return of +25.7%. The Board paid three interim dividends of 1.0p per share and has announced the payment of a fourth interim dividend of 1.9p per share. This brings the total dividend for the year to 4.9p, unchanged from last year.
The chairman says that the difference between the company’s return and that of the benchmark is due principally to the strong performance of internet and technology stocks, notably in China, which they do not own as these businesses pay little or no dividends. The manager reiterates this point. He says that, in China, the “negative” impact of not holding internet stocks has been somewhat mitigated by exposure to A-share names such as Midea and Fuyao Glass Industry Group, which were top stock-level contributors over the period. An underweight position in Korea was also unhelpful for the fund’s performance relative to the benchmark.
JEMI : JPMorgan Global Emerging Income lags on technology underweight