Fund Profile

Schroder Asian Total Return 03 July 2019

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by Schroder Asian Total Return. 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 Asian Total Return (ATR) aims to benefit from the impressive growth potential in Asian stock markets. At the same time, the managers seek to limit the equally impressive volatility that stock markets in the region have exhibited historically.

Managers Robin Parbrook and King Fuei Lee have built an investment process on a foundation of highly active, valuation-sensitive stock selection. They overlay this with the use of quantitative economic models to warn them of impending market corrections in the underlying countries, which allows them to apply hedges to the portfolio to limit the exposure to the downside.

The managers take a highly active, benchmark-agnostic approach, which they view as crucial in Asian markets. The valuation element to the stock-picking and the hedging strategy have helped the trust produce one of the highest upside/downside capture ratios in the sector over the past five years.

At the same time, the trust has handsomely outperformed the index and peer group under the strategy implemented by Robin and King Fuei since March 2013. Over the past five years, the trust’s NAV total return has been 110%, while the average trust in the AIC Asia Pacific ex Japan sector has returned just 76% and the index even less – 71.1%. The trust has also displayed NAV volatility significantly below the sector average over the period.

Although the trust has a total return objective, the managers view dividends as a sign of a well-run company and have been increasing their exposure to yielding companies as their view on the marker becomes more bearish. As a result, the trust’s dividend growth has been substantial in recent years, and the shares now yield 1.7%.

Schroder Asian Total Return has traded on a premium since July 2017, currently 1.3%, and has been regularly issuing shares. The trust has a performance fee charged on absolute rather than relative returns.

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Fund History

16 Feb 2022 Investing in Asia with investment trusts
How closed-ended funds can help investors get exposure to Asian companies…
20 Jan 2021 Kepler's top-rated investment trusts for 2021
We update our annual quantitative ratings for investment trusts…
15 Apr 2020 Fund Analysis
ATR is the standout trust in its sector for both absolute and risk-adjusted returns, now trading on a significant discount...
19 Feb 2020 Dialling down the noise
Schroder Asian Total Return Investment Company takes a unique approach to Asian markets which allows the managers to focus on targeted stock selection and effectively cancel out market noise through the selective use of hedging...
03 Jul 2019 Push-me pull-you
Two contrasting influences are dominating the outlook for Asian markets - we analyse them and how Asia trusts are positioning their portfolios in response...
03 Jul 2019 Fund Analysis
Schroder Asian Total Return seeks to limit the volatility of Asian stock markets while capturing the best stocks...
24 Dec 2018 Why did the chicken cross the road?
Because he was so bored of reading newspapers devoted entirely to Brexit he was hoping he’d be hit by a truck.
08 Aug 2018 Feeling giddy?
As markets look toppy, we consider a few equity trusts with different approaches to diversification and risk management...
17 May 2018 Blast off!
As China A-Shares join the global indices, many investors remain structurally underexposed to this exciting region...
05 Mar 2018 Fund Analysis
A unique trust in the Asia Pacific sphere, aiming for long-term growth with a derivative overlay allowing stockpicking to drive returns...
09 Feb 2018 The madding crowd
Recent volatility could be a taste of things to come, so we examine trusts that offer capital protection...
30 Nov 2017 Race ready?
We analyse the outlook for emerging markets and, in particular, the genuine active funds that focus on them…
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...
31 Mar 2017 Bargain or basket case?
As the reality of Donald Trump's administration settles in, we examine the case for emerging markets exposure...
31 Mar 2017 Fund Analysis
A well resourced trust focused on Asian equities with a unique absolute return approach...
View all

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