Edinburgh Dragon – Returning to form is Marten & Co’s latest update note on the fund, published in August 2016
Edinburgh Dragon Trust (EFM) is the largest and one of the most liquid investment companies focused on the Asia ex Japan region. Its strong focus on quality has served it well over the long term.
EFM’s manager says that an environment of very low interest rates has distorted markets, with the result that EFM’s focus on quality has not been rewarded. The manager believes that China is stabilising and that the outlook for Asia appears to be improving.
In recent months, there has been a noticeable improvement in EFM’s net asset value (NAV) performance relative to its peers and its benchmark. Over six months to the end of July, EFM was 1.6% ahead of its peers and 2.7% ahead of its benchmark. However, in the short term, the share price has not kept pace and EFM’s discount has widened.
Edinburgh Dragon – Returning to form
Edinburgh Dragon aims to achieve long term capital growth through investment in the Far East. The company’s benchmark index is the MSCI All Country Asia (ex Japan) Index. Investments are made in stock markets in the region, with the exception of Japan and Australasia, principally in large companies. When appropriate, the trust will utilise gearing to maximise long term returns.
We have written notes on the company that explain how it works:
“An artificial reality“, published on 19 April 2016, talks about the manager’s belief that markets could move in the fund’s favour if economies start to behave more normally – click here to read it
“Focused on quality”, published on 13 September 2015, delves into the investment strategy and style of the fund – click here to read it