JPMorgan Chinese boosted by tech and healthcare

JPMorgan Chinese has published its results covering the year to the end of September 2014. Over this period the return on net assets was 7.8% – 1% more than the return on the MSCI Golden Dragon Index. the fund’s rating improved and so the return to shareholders was 12% – this includes a 1.6p dividend paid in February.

The manager’s report says that holdings in internet stocks were amongst the top contributors to performance. This included names such as Tencent, JD.Com and YY Inc which all performed strongly over the year. In addition, an overweight in property stocks such as Sunac China helped performance given expectations over monetary loosening later in the year.Healthcare names such as Luye Pharma and iKang Healthcare also helped performance as the stocks were deemed beneficiaries of structural reform in China.Technology holdings in Taiwan such as Largan and Advanced Semiconductor were also contributors to performance as they rose over the period under review due to strong order books as Apple placed component orders ahead of the i-Phone 6 launch.

On the negative side, they were hurt by an allocation to the JPMorgan China New Generation Fund, which invests in A-shares. Unfortunately, the market fell throughout the period under review and only started moving upwards towards the end of the review period. They were also hurt by an underweight in Hong Kong Exchanges and Clearing. which benefited from a relaxation of the trading rules, the Shanghai-Hong Kong Stock Connect programme; in theory this allows 2-way trading between the two markets. Our overweight in China Cinda Asset Management was another detractor as the stock fell due to concerns over the property value of its collateral.

JMC : JPMorgan Chinese boosted by tech and healthcare


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