JPMorgan Global Emerging Markets Income Trust Annual General Meeting - - PowerPoint PPT Presentation
JPMorgan Global Emerging Markets Income Trust Annual General Meeting 24 th November 2016 Omar Negyal, Executive Director Portfolio Manager omar.r.negyal@jpmorgan.com Jeffrey Roskell, Managing Director Portfolio Manager
Omar Negyal, Executive Director Portfolio Manager
Jeffrey Roskell, Managing Director Portfolio Manager jeffrey.roskell@jpmorgan.com
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(%)
30/09/15 to 30/09/16 30/09/14 to 30/09/15 30/09/13 to 30/09/14 30/09/12 to 30/09/13 30/09/11 to 30/09/12 Share price
43.02%
5.10% 10.70% 17.46%
Net asset value
36.72%
3.62% 10.73% 22.24%
MSCI Emerging Markets Net Index
36.18%
4.19% 0.69% 12.81%
Source: Morningstar. J. P. Morgan Asset Management. Inception: July 2010. Benchmark: MSCI Emerging Markets Net. Performance data has been calculated on NAV to NAV basis including ongoing charges and any applicable fees, with any income reinvested, in GBP. Please note Benchmark indices do not include fees or operating expenses and are not available for actual investment. Past performance is not necessarily a reliable indicator for current and future performance.
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Source: Annual Report and Accounts. J.P. Morgan Asset Management. Data as of 31st July 2016. The opinions and views expressed here are those held by the author as at date
Dividend for last financial year (per share) .
Emerging market equities delivered a strong positive return in the 12 months to 31st July 2016
Equities and currencies have strengthened slightly from cheap levels as sentiment has improved
Emerging market dividends remain under pressure, as companies struggle to increase their payouts against a challenging growth backdrop
The Company’s approach, which is to invest in a diversified portfolio of relatively high-yielding stocks to receive dividends from across sectors and countries, remains unchanged. 31st July 2015 – 31st July 2016 Portfolio return +18.3% Index +16.7% Return to shareholders +21.3% Return on net assets +16.9% Dividend* 4.90p
Past performance is not necessarily a reliable indicator for current and future performance.
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Source: J.P. Morgan Asset Management. 12 month yield , Eikon, data as of September 2016 .For illustrative purposes only. For a representative account. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management may or may not hold positions on behalf of its clients in any or all of the aforementioned securities. Diversification does not guarantee investment returns and does not eliminate the risk of loss.
Moneta Bank: Czech Republic financial with consumer lending tilt, yielding close to 7%. Low dividend yield Target dividend yield High Dividend Yield ( <3% ) ( 3-6% ) ( >6% ) Target 20% of portfolio Target 20% of portfolio Delta Electronics: Taiwanese IT company which has successfully evolved its business mix over time. AVI: A South African food products company whose brands span everything from hot beverages to frozen convenience foods. Dividend payout 80%. Target 60% of portfolio
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Portfolio Fund Index Price to earnings (forward) 12.7x 12.3x Price to book 2.5x 1.6x *Gross prospective dividend yield 5.0% 2.8% Return on equity 19.8 12.9 **Net Debt to Equity 18% 31% Beta 0.94 (1.00 geared) Holdings 70 817 Active share 89.8
Source: UBS PAS, PRISM The Fund is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice. The portfolio is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice. *Portfolio yield is the aggregate weighted sum of the stock level yields which are calculated (12-month forward DPS / Current price)*100. **Net debt to equity ratio excludes financials.
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Top Contributors Relative weight (%) Stock return (%) Impact (%) Vanguard Intl Semiconductor 2.06 90.53 1.24 Siliconware Precision Industries 1.50 68.29 1.19 Bidvest 1.98 86.79 0.70 Engie Brasil Energia 1.58 49.78 0.52 Tofas 1.71 46.08 0.50
Country attribution (%)
Attribution summary Stock: +0.06 Country: +0.42 Benchmark MSCI Emerging Markets Index (Net)
Top Detractors Relative weight (%) Stock return (%) Impact (%) Samsung Electronics
35.01
Advanced Info Service Public 0.74
Tencent Holdings
51.79
MTN 0.20
China Resources Power 1.32
0.53
0.06 0.13 0.31 0.34 0.53 1.63 3.18
0.0 2.5 5.0
Cash (o) South Korea (u) South Africa (o) Thailand (o) India (u) Saudi Arabia (o) Brazil (o) Czech Republic (o) Russia (o) Malaysia (u) Hungary (o) Greece (u) Mexico (u) Turkey (o) China (u) Taiwan (o)
Stock selection Asset allocation
Source: J.P. Morgan Asset Management, MSCI, Factset, gross of fees in GBP to 31st July 2016. Data for Total Attribution shown (stock selection plus country allocation). Attribution may not match official returns due to differences in systems, rounding. The Fund is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice.
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Taiwanese Information Technology company, with minority
Beneficiary of the semiconductor outsourcing trend
Cash accounts for 70% of balance sheet
Management place a strong emphasis on the dividend – current yield is 5%
Turkish telecommunication company
Dividend was not ratified at the AGM, causing dividend stream uncertainty
Given this dividend disappointment, we sold this position
Source: Bloomberg. Company accounts. Data as of November 2016. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management may or may not positions on behalf of its clients in any or all of the aforementioned securities. There is no guarantee that any forecast made will come to pass.
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Data as of 30th September 2016. Source: J.P. Morgan Asset Management. ’Any research in this document has been obtained and may have been acted upon by J.P. Morgan Asset Management for its own purpose. The results of such research are being made available as additional information and do not necessarily reflect the views of J.P.Morgan Asset Management. Any forecasts, figures, opinions, statements of financial market trends or investment techniques and strategies expressed are unless otherwise stated, J.P. Morgan Asset Management’s own at the date of this document. They are considered to be reliable at the time of writing, may not necessarily be all-inclusive and are not guaranteed as to accuracy. They may be subject to change without reference or notification to the investor/prospect
0.0 5.0 10.0 Fund % Index % +/- 0.0 2.0 4.0 6.0 8.0 10.0 Fund % Index % +/-
0.0 5.0 10.0 Fund % Index % +/-
0.0 10.0 20.0 Fund % Index % +/-
MSCI Russia
has 6.6% yield so selective
available
Structural
underweight in India
Low payout
ratios with expensive valuations
We own
consumer names, telecoms, utilities
Avoid banks, low
profitability cyclicals, internet, property
Largest overweight Taiwan – particularly Information Technology Largest underweight China – no state owned enterprises (SOEs) or internet held
Brazilian
companies have legal obligation to pay out 25%
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We have sold out of Chinese Banks Financials exposure has remained consistent given new positions in Czech Republic, South Africa and Brazil, not just banks but
also insurance companies and stock exchanges
Rotated positions in Russia, which remains an attractive market for yield Trimmed names which have performed strongly, notably Brazil Purchases are driven by individual stock opportunities, such as: – FirstRand – high quality South African Bank – HKT Trust – Asian telecom – Bolsa Mexicana – Mexican stock exchange
Source: J.P. Morgan Asset Management Data as of 30th September 2016 The opinions and views expressed here are those held by the author at the date of publication which are subject to change and are not to be taken as or construed as investment advice. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management may or may not positions on behalf of its clients in any or all of the aforementioned securities. There is no guarantee that any forecast made will come to pass
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GTM – UK
MSCI EM Index: Long-term growth in dividends per share (DPS) and earnings per share (EPS) in USD
Rebased to 100 at December 1995, in USD
Source: (Left) FactSet, IBES, MSCI, J.P. Morgan Asset Management. Guide to the Markets - UK. Data as of 30th September 2016. Forecasts, projections and other forward looking statements are based upon current beliefs and expectations. They are for illustrative purposes only and serve as an indication of what may occur. Given the inherent uncertainties and risks associated with forecasts, projections and other forward statements, actual events, results or performance may differ materially from those reflected or contemplated
EM EPS (fwd) DM EPS (fwd) DM DPS EM DPS 50 100 150 200 250 300 350 400 450 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13 '15
Emerging market dividends remain under pressure, as
Dividends across EM declined in the financial year and we
However, the Company held its dividend as the Board
Our expectation is that payout ratios will be held steady by
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The opinions and views expressed here are those held by the author as at date of this document, which are subject to change and are not to be taken as or constructed as investment advice. Investment in emerging markets may be more volatile and therefore risk to your capital could be greater. Emerging Markets may be subject to increased political, regulatory and economic instability, less developed custody and settlement practises, poor transparency and greater financial risks. Emerging market currencies may be subject to volatile price movement
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Objective
The Company’s investment objective is to provide a dividend income combined with the potential for long term capital growth from a diversified portfolio of emerging markets investments.
Risk Profile
also be traded less frequently than those on established markets. This means that there may be difficulty in both buying and selling shares and individual share prices may be subject to short-term price fluctuations.
Investment in emerging markets may be more volatile and therefore risk to your capital could be greater. Emerging Markets may be subject to increased political, regulatory and economic instability, less developed custody and settlement practises, poor transparency and greater financial risks. Emerging market currencies may be subject to volatile price movement.
Please refer to the Investment Trust Profiles Document for more information relating to the Fund.
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This is a promotional document and as such the views contained herein are not to be taken as an advice or recommendation to buy or sell any investment or interest thereto. Reliance upon information in this material is at the sole discretion of the reader. Any research in this document has been obtained and may have been acted upon by J.P. Morgan Asset Management for its own purpose. The results of such research are being made available as additional information and do not necessarily reflect the views of J.P.Morgan Asset Management. Any forecasts, figures, opinions, statements of financial market trends or investment techniques and strategies expressed are unless otherwise stated, J.P. Morgan Asset Management’s own at the date of this document. They are considered to be reliable at the time of writing, may not necessarily be all-inclusive and are not guaranteed as to accuracy. They may be subject to change without reference or notification to you. It should be noted that the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Changes in exchange rates may have an adverse effect on the value, price or income of the product(s) or underlying overseas investments. Both past performance and yield may not be a reliable guide to future performance. There is no guarantee that any forecast made will come to pass. Furthermore, whilst it is the intention to achieve the investment objective of the investment product(s), there can be no assurance that those objectives will be met. J.P. Morgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co and its affiliates worldwide. You should note that if you contact J.P. Morgan Asset Management by telephone those lines may be recorded and monitored for legal, security and training purposes. You should also take note that information and data from communications with you will be collected, stored and processed by J.P. Morgan Asset Management in accordance with the EMEA Privacy Policy which can be accessed through the following website http://www.jpmorgan.com/pages/privacy. This material should not be considered as a recommendation relating to the acquisition or disposal of investments. This material does not contain sufficient information to support an investment decision and investors should ensure that they obtain all relevant information before making any investment. Investment is subject to documentation Investment Trust Profiles and Key Features and Terms and Conditions, copies of which can be obtained free of charge from J.P. Morgan Asset Management Marketing Limited. Issued by J.P. Morgan Asset Management Marketing Limited which is authorised and regulated in the UK by the Financial Conduct Authority. Registered in England No. 288553. Registered address: 25 Bank St, Canary Wharf, London E14 5JP.
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