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Fund Profile

Disclaimer

This is a non-independent marketing communication commissioned by Schroder Investment Management. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview
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Overview

Schroder AsiaPacific (SDP) owns a portfolio of the best ideas of the broad and deep Schroders analyst team covering the fast-growing Asian region, curated by highly experienced manager Richard Sennitt. Richard draws on the detailed stock-specific work of the analysts to identify what he thinks are the best long-term growth opportunities in Asia (ex Japan). Over the years, the team have identified global leaders such as Samsung and TSMC at early stages of their development, which has helped deliver a long-term record of outperformance (see Performance).

Richard, who has 28 years’ experience working in Asian equities, and assistant manager Abbas Barkhordar, have built a portfolio tilted towards high-quality secular growth stories and companies which the team believe can generate high returns for investors over the long run. ESG concerns are integrated into the stock selection process and influence the managers’ views on the potential and risks in the business.

Over the past year Asian markets have fallen, with the winners of the recent past being amongst the worst performers. This has hurt SDP, as its focus on quality stocks has resulted in large positions in some of the region’s best long-term opportunities, which give the fund a growth bias. Richard tells us this has created opportunities for stock-picking. His focus is on the operational performance and prospects for his companies, and he has been adding on weakness to some companies that have sold off but which he thinks have strong long-term growth prospects. The trust trades on a discount of 11.8%.

Analyst's View

We think SDP is an attractive proposition for an investor who wants to take long-term exposure to the growth potential in Asian equities. The strategy and process are built around stock selection and focussed on quality and long-term potential. This active approach increases the chances of long-term outperformance, but also brings with it the potential for underperformance when markets are driven by macroeconomic considerations or key overweight stocks fall out of favour. Both have been the case over the past year, which has contributed to SDP’s discount widening. While it may be that markets fall more before they bottom, this discount could provide a boost to returns in the long-term if investors hold on to the shares through the cycle – we note SDP has been on a low single digit discount in the past when in favour.

In terms of the immediate outlook, Richard tells us that valuations in Asia are definitely more attractive than they were a year ago, although not markedly cheaper than long-term averages. Importantly, the froth has come out of many of the most expensive areas as markets have re-rated on concerns about higher interest rates and inflation, and this has created attractive opportunities for stock-picking. Richard notes Asian economies are not seeing significant wage pressures, which may imply that looser, more supportive monetary policy is possible. Meanwhile, currencies have been more stable than in past crises thanks to stronger current account positions. While Asia would not be immune to any global recession, in our view it does look more resilient than in the past.

Bull

  • Well-resourced team with good track record of success built on stock-picking
  • Active approach increases chances of outperformance
  • Wide discount could provide good long-term entry point

Bear

  • Asian markets tend to be volatile
  • Investment focus could lag in value-driven markets
  • Active approach to country and stock selection may lead to short-term periods of underperformance
Continue to Portfolio

Fund History

21 May 2024 Results analysis: Schroder AsiaPacific
A tech overweight and China underweight have contributed to another period of SDP outperformance…
14 May 2024 Crouching tiger, not so hidden dragon
SDP is well-positioned to benefit from the compelling growth story in Asia…
22 Mar 2024 Schroder AsiaPacific Fund plc: Why active investing works in Asia
How a consistent, disciplined investment approach can add value
20 Feb 2024 Fund Analysis
SDP’s pragmatic approach has driven another year of outperformance…
12 Dec 2023 Results analysis: Schroder AsiaPacific
SDP has delivered another year of outperformance, yet still trades at a discount…
15 Nov 2023 Asia’s growth opportunities
World-leading companies and domestic growth stories can be found throughout the region…
15 Nov 2023 The Asian century
Failing to invest in Asia means omitting half the global economy from your portfolio…
14 Jul 2023 Asian investment trusts: an abundance of opportunity
Exploring investors’ renewed enthusiasm for Asian equity...
07 Jul 2023 Investment trusts: Exploring the positive backdrop for Asian equities
Schroder AsiaPacific Fund: Backing the brightest growth prospects in Asia...
01 Jun 2023 Investing in quality companies in Asia, with Schroder AsiaPacific's Abbas Barkhordar - Podcast: Trust Issues #17
We talk China, Vietnam and buy/sell decisions...
23 May 2023 Fund Analysis
SDP has delivered strong long-term outperformance driven by stock selection…
16 Dec 2022 Investment Trusts: opportunities in all market conditions
How are current market conditions impacting the Schroders investment trust range?
20 Oct 2022 Fund Analysis
SDP invests in quality companies to take advantage of the long-term secular growth opportunities in Asia…
08 Apr 2020 Children of the Revolution
The outperformance of technology hints at an exciting possible future for the market when the virus is beaten…
01 Apr 2020 Fund Analysis
SDP is the standout Asia Pacific trust over ten years…
06 Nov 2018 Fund Analysis
Schroder AsiaPacific aims to generate long-term capital growth from a portfolio of emerging Asian equities...
10 Oct 2018 Information overload
Our analysis shows the long term case for emerging markets remains largely unaffected by much of the negative newsflow surrounding the sector...
19 Apr 2018 Fund Analysis
A quality oriented Asian equities fund which has performed well throughout the cycle under a highly experienced manager.
19 Apr 2018 What now for Asia?
We examine battered Asian equities amid talk of a trade war between the US and China...
19 Jan 2018 Full steam ahead?
Jupiter Fund of Investment Trusts manager Richard Curling gives his view on the potential risks and rewards for the major equity regions around the world in 2018...
30 Nov 2017 Race ready?
We analyse the outlook for emerging markets and, in particular, the genuine active funds that focus on them…
29 Jun 2017 Brave new world
We find out how the outlook appears today to you, and ask the top managers in each sector, region and asset class where they see the opportunities in it...
20 Jun 2017 Fund Analysis
An Asian equities trust run by a highly experienced manager, a focus on high quality-companies and low charges compared to its size...
02 Jun 2017 Finely balanced...
We take a closer look at the Asia Pacific ex Japan sector following a period of improved inflows into the open-ended sector and the recent outperformance of Asian equities...
07 Mar 2017 A challenge of perception
Asian Total Return Investment Company chairman David Brief says the trust's total return focus is misunderstood by many investors....
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