The new strategy would be benchmark unconstrained. The trust currently measures its performance against the MSCI All Countries Asia Pacific Index and has a fixed Japan weighting of 25%. It would shift to comparison with nominal GDP growth in the region measured over three year periods.
The change is subject to a shareholder vote however major shareholders have already been consulted and are said to be supportive.
The firm is also planning a tender offer for up to 10% of the issued shares at a price close to net asset value.
The new strategy will be to target between 20 and 30 companies rather than the current 50 to 70 range. Investment decisions would be based on companies’ absolute return potential.
“We believe the proposed changes are in the best interests of all our shareholders and our major shareholders are supportive,” said Patrick Gifford, chairman of Trust.
“By focusing on the faster growing Asian markets and removing the requirement to invest in the developed markets of Japan and Australasia, we believe we will offer a strategy more attractive to both our existing and potential shareholders,” he explained.
He added that the shift to being unconstrained by a benchmark will better enable investors to grow their investment with lower absolute volatility.
