JO Hambro Capital Management has closed Scott McGlashan's Japan fund at the pre-agreed level of £200...
JO Hambro Capital Management has closed Scott McGlashan's Japan fund at the pre-agreed level of £200m. This follows the company's strict policy of limiting capacity on its funds.
"We close all long-only funds at some point at a pre-agreed level because of liquidity issues," said Sven Kuhlbrodt, marketing director at JO Hambro Capital Management. "It is unlikely that the fund will open again. This only usually happens if the market underperforms over a long period of time."
The Japan fund is a Dublin-based Oeic, which has around 40-60 holdings. The fund is benchmarked against the Japanese Topix index but has a high expected tracking error. It has a mid and small cap bias and McGlashan focuses on stocks that are mis-priced.
Stocks are chosen that have good medium-term growth prospects, and strong and healthy balance sheets on attractive valuations relative to their historic valuations, their domestic peers and international companies.
Stocks are sold when reasons for purchase no longer apply, for example if profits disappoint, medium-term outlook has deteriorated or expected corporate action has not materialised. A catalyst is identified for market re-evaluation, such as earnings surprise, restructuring or corporate action, as underpriced stocks can stay so indefinitely unless the market's attention is grabbed.
Dead wood is actively eliminated and the proceeds re-invested in better opportunities. The fund turnover is relatively high - about 100% annually.
McGlashan has 23 years' experience as an investor in Japan. He previously worked for Perpetual where he was director and head of Far East investment. He left in 2000 to co-found boutique investment house Jade Absolute. Out of the 14 years on record, the funds managed by McGlashan have outperformed the Japanese stock market 12 times.
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