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Fund Profile


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.

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Schroder Japan Growth (SJG) takes a fundamental, bottom-up approach to Japanese equity investing. SJG is managed by Masaki Taketsume, who is supported by a substantial roster of seasoned Tokyo-based investment professionals. His contrarian approach has led SJG to have more of a tilt to value stocks than its peers, while his desire to maximise SJG’s alpha potential has also led it to overweight small caps.

Masaki aims to uncover ‘undiscovered opportunities’: companies which can offer cutting-edge solutions or market-leading technologies but which also trade on cheap valuations through having flown under the market’s radar. We describe the investment process in greater detail in our Portfolio section.

SJG’s process has paid off over the last 12 months, over which time it ranks as one of the best-performing Japanese equity trusts. In a market where growth stocks have come under increasing pressure, Masaki’s valuation sensitivity has allowed SJG to avoid much of this sell-off, especially in comparison to many of its peers. Yet SJG’s performance remains predominantly stock-driven, and as we highlight in our Performance section, it has been able to demonstrate the benefits of successful stock selection over the longer ten-year time horizon.

SJG trades on a 13.5% Discount, which is wide compared to that of its peers. However, SJG’s discount has remained far more stable than that of its peers in recent months, thanks to the comparative lack of sell pressure that SJG has faced.

Analyst's View

SJG’s contrarian, bottom-up approach has led it to retain a value bias, something increasingly rare amongst investment trusts (as we pointed out in a recent editorial). We think that in the current macroeconomic environment of high inflation and rising interest rates, SJG’s style may continue to do well and become in demand.

One of SJG’s key differentiators is that it’s the comparatively low valuation of its portfolio comes as the result of Masaki’s preference for cheap companies within growth sectors rather than the more conventional ‘old Japan’ stocks. This and the focus on identifying quality companies mean that SJG may offer a good form of stock or sector diversification against other value strategies while not being so exposed to the current macroeconomic environment. SJG may also be particularly attractive to investors who are looking to reduce their portfolio’s overall valuation sensitivity without having to hold the more conventional value sectors such as banks and commodity materials including energy, steels and metals.

SJG’s discount may offer investors an attractive entry point. While it has held up better than that of its peers in recent months, it has yet to show substantial narrowing. While this may be due to the increased near-term uncertainty, if SJG’s improved performance continues until the markets eventually stabilise then the discount could narrow, providing a kicker to returns.


  • Contrarian, value tilt could do well in rising interest rate environment
  • Discount may offer attractive entry point
  • Offers exposure to lower valuations without the typical sector overweights


  • May underperform during growth stock rallies
  • Gearing can enhance losses on the downside
  • Small-cap bias can enhance risk
Continue to Portfolio

Fund History

12 Jan 2024 Facing the future without fear
Do STEM graduates = money making companies?
08 Dec 2023 Fund Analysis
SJG continues its strong run of performance versus both the index and sector...
15 Nov 2023 Finding value in Japan
SJG is taking advantage of attractive valuations and corporate reforms…
15 Nov 2023 The Asian century
Failing to invest in Asia means omitting half the global economy from your portfolio…
19 Oct 2023 Not just a value play
There is more to Japan than gaming PB ratios…
02 Oct 2023 Results analysis: Schroder Japan Trust
SJG has delivered outperformance of the Japanese markets for three consecutive years…
27 Sep 2023 Ohayō Japan!
Our analysts discuss what they think may be a new dawn for the Land of the Rising Sun...
07 Jun 2023 Under pressure
We identify the equity trusts which have delivered the best downside protection in recent years...
02 Mar 2023 The Devil’s in the demographics
China’s population is in decline - should it turn east or west for inspiration..?
15 Feb 2023 Lost in translation
We argue Japanese equities look attractive on both a short and long-term view…
10 Feb 2023 Fund Analysis
Japan could be one of the most attractive countries for investment in 2023…
16 Dec 2022 Investment Trusts: opportunities in all market conditions
How are current market conditions impacting the Schroders investment trust range?
16 Dec 2022 Japan’s chance to shine – find out why this time is different
Schroder Japan Growth Fund - positioned to capture the opportunity in Japan...
16 Jun 2022 Fund Analysis
SJG is on a run of strong performance, while the discount remains attractive…
27 Apr 2022 Finding value in a haystack
Non-income value strategies are becoming increasingly scarce, but the holdouts represent attractive near-term opportunities…
05 Aug 2021 Fund Analysis
As the most value-exposed trust in its sector, SJG has been a clear beneficiary of the reflationary rally…
14 Jul 2021 Grade inflation
We look at how our discounted opportunities portfolio has done in the first half of the year and update on the performance of our long-term rated funds…
08 Jul 2020 Fund Analysis
Operating a disciplined and consistent investment approach, SJG nonetheless trades on the widest discount in the sector...
04 Jun 2020 A different approach to Japan
Schroder Japan Growth offers a solid yield and a crisp focus on valuation which differentiates it from its peers...
18 Mar 2020 Their darkest hour?
We update our shortlist of discount opportunities...
28 Nov 2019 Is there a generational opportunity in Japan?
Two of our analysts go head-to-head, arguing the case for Japan...
11 Sep 2019 Fund Analysis
Despite clear continuity of management style, the retirement of Andrew Rose has seen this trust move to a wide discount versus peers...
01 May 2019 Sweet or sour?
Three months in, we check up on our list of discount opportunities...
30 Apr 2019 Fund Analysis
Schroder Japan Growth, despite its name, is the most value-exposed trust in the AIC Japan peer group...
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