Manager review
JPM Taiwan is managed by the JPM Taiwan equity team, with William Tong serving as the Taiwan CIO, Ng said.
The team works under a broader-based JPM Greater China team, with Howard Wang, head of Greater China, also serving as the back-up manager.
“There are extensive in-house resources that back the fund managers, and that includes a team of nine analysts focusing on Greater China research, with around four of them covering different sectors among Taiwanese equities.
The Value Partners fund did not specify the lead manager. The firm uses a team to manage the portfolio. In addition, group chairman and co-CIO Cheng-hye Cheah has instilled in the firm a value-investing approach for all actively-managed funds, according to Ng.
Fees
The latest ongoing charges (OCF) of the JPM (A dist USD) is 1.80% and for Value Partners’ product it is 2.01%.
In addition, a 15% performance fee applies to the Value Partners fund and that comes with a high watermark principle, Ng said.
“That means investors of Value Partners will potentially incur higher fees as the fund’s NAV exceeds the preceding financial period in which the performance fee was charged.
“I should note that there is no adjustment of equalisation on the Value Partners fund. Thus, some investors may still incur performance fees even though that individual investor is suffering from a loss.”
Conclusion
Technology stocks are the key composition of Taiwanese equities, so it goes without saying that both funds are heavily invested in the IT sector. However, JPM and Value Partners have a different focus in terms of stock selection, and that differentiates the risk/return perspective of the two funds, Ng explained.
“Investors that look for growth are better suited for JPM, while more risk-averse investors may favour Value Partners. It is good that both funds primarily focus on bottom-up investing, as Taiwanese equities include about 900 stocks, many of them are smaller cap.
“An in-depth bottom-up approach could help uncover company-specific opportunities that emerge in the market. Again, investors of Value Partners should be aware that with no equalisation in the performance fee arrangement, higher costs could be incurred even if the investor did not make a profit from the fund,” Ng said.
