(Alliance News) - JPMorgan Emerging Markets Investment Trust PLC on Wednesday said it outperformed its benchmark in its most recent financial year, a result of its investment policy.
In its year ended June 30, the company reported a 13% return on net assets, versus a 5.0% return from the MSCI Emerging Markets index with net dividends reinvested, in sterling terms.
The investment manager's report explained that "the margin of performance above the benchmark return has been unusually high" and the investment manager contribution totalled 9.2%, which was "more than twice the long-run average". Much more than half of the total NAV return in the period was from the investment policy, and not from overall market returns.
For this reason, the investment manager was cautious, and asked shareholders not to assume they were "struck by sudden genius".
Net asset value per share rose to 1,075.8 pence on June 30 from 968.2p the year before.
JPMorgan Emerging Markets is proposing a 9.0p per share dividend, lifting the total for the year by 12% to 14.0p per share from 12.5p per share.
Chair Sarah Arkle said: "There are still a number of uncertainties in global economies with continued worries over slowing economies and trade between the US and China, with many interest rates at historic lows (and in some cases negative levels). Uncertainty over Brexit has caused sterling to be weak over the financial year against most currencies, including emerging market currencies. This has boosted the absolute returns in sterling for our shareholders and, were there to be any reversal of sterling's weakness, this would, in contrast, detract from sterling share price returns.
"After a period of extremely positive relative performance it is important to point out that the investment manager's approach, focusing particularly on high quality growth companies, may in the future encounter periods when the company does not outperform the benchmark index, as has happened in the past. However, valuations in the companies we own do not look overstretched and we believe that the focus on finding and investing in long term winners across the emerging markets' spectrum will continue to add value for our shareholders over the longer term."
Shares in JPMorgan Emerging Markets were down 1.0% at 976.00p in London on Wednesday afternoon.
By Anna Farley; annafarley@alliancenews.com
Copyright 2019 Alliance News Limited. All Rights Reserved.
JPMorgan Emerging Markets Investment Trust (JMG)