It was a chance to move to the country of his birth that prompted David Mitchinson to leave his number-one rated Japan fund at Framlington in 2004. Since moving to the Tokyo offices of JP Morgan, he’s turned “what was a mediocre fund into a very good one”, says What Investment. Over the past three years, the JP Morgan Japan Fund has turned a £1,000 investment into £2,795, compared to £1,807 for the sector, says Citywire. It’s a feat that hasn’t gone unnoticed. In the 2006 edition of the Citywire European top 100, he was ranked third out of some 3,150 managers.
The Citywire AAA-rated Mitchinson believes the recent sell-off in Japan is being driven by panic selling, and that firms there are now trading on attractive valuations. “We think that, at this level, the Japanese market is attractive and on a mid-term view should prove rewarding,” he tells The Daily Telegraph. The economy is expected to grow 2.4% this year, corporate profits are up on last year, while unemployment is below 4%, an eight-year low. So, although market conditions remain fragile, Mick Gilligan of IFA Killick & Co tells The Daily Telegraph that he believes “the medium-term investment case for Japan is strong (particularly in small caps)”.
Stockbrokers Hargreaves Lansdowne agree. Although “the fund could experience short-term periods of underperformance over the long term”, they say Mitchinson’s stockpicking is “exceptional”, and he and his team “have the skills to reward investors”. Recent underperformance means that for those not willing to take a risk, you’re money could be safer with a Nikkei tracker.
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