JPMorgan Emerging Markets Dividend Income (JEMI)

JPMorgan Emerging Markets Dividend Income (JEMI) has delivered outperformance since the start of the year, amid a strong period for emerging market equities, which have outpaced their developed market peers. Returns have been driven by holdings in companies providing essential components or services for the build-out of AI infrastructure, such as ASE Technology, a provider of semiconductor packaging and testing services.

However, manager Omar Negyal has been trimming the Portfolio’s exposure to these names, as their valuations have increased and their Dividend yields have decreased. As a result, JEMI is now underweight the information technology sector, although it remains the largest component of the portfolio in absolute terms. Conversely, financials is JEMI’s largest sector overweight, with the allocation to this sector primarily consisting of banks, albeit across different regions and countries. That includes, for example, India’s HDFC Bank and National Bank of Greece.

At the country level, China is the largest overweight, with Omar having shifted his allocation towards companies with strong brands and pricing power, like distiller Kweichow Moutai. He has also added to the trust’s position in technology conglomerate Tencent, one of the largest players in AI in China. Brazil is also a significant country overweight, with Omar highlighting the strong capital allocation skills of Brazilian management teams and corporate laws supporting dividend distributions.

In FY 2026, JEMI will pay a total dividend of 6.0p, with the final instalment to be distributed in October. This represents a 7.1% year-on-year increase and results in a prospective yield of 2.9%. Finally, Gearing stood at 5.4% at the end of July.