Funds that fit with Stewart Investors Asia Pacific Leaders Sustainability

Important information: The value of investments and the income from them can go down as well as up, so you may get back less than you invest.

One of the beauties of an internationally diversified portfolio is that it allows you to take advantage of the best opportunities from around the world. This is especially the case if you invest in mutual funds, as it's just as easy to get exposure to far away market as it is to those closer to home.

A good example is the Asia Pacific region, which the International Monetary Fund (IMF) believes will remain a key driver of global growth in 2024. The promising macro-economic backdrop could help to generate some potentially attractive returns for those who are willing to invest in the area.¹

One of the most popular ways to do this is by using Stewart Investors Asia Pacific Leaders Sustainability, which is a member of Fidelity’s Select 50 list of handpicked funds. It has more than £6bn of assets under management and has built up a good track record relative to its benchmark.

The experienced management team follows a long standing and consistent approach of investing in high quality companies, with a particular emphasis on corporate governance. Unlike many funds that adopt this type of style, they also have some valuation sensitivity, so will sell holdings when they believe that the price is too high.

Stewart Investors Asia Pacific Leaders Sustainability top 10 holdings

Source: Fidelity International, as at 30.11.23

Asia Pacific accounts for a relatively small part of global equity indices, so UK investors will normally only include a small allocation in their portfolios. Those who already hold the Stewart Investors fund, but who want to diversify with more of a value style exposure, have a couple of options available in the Select 50.

One such is Fidelity Asian Smaller Companies, whose manager has broad experience of investing in the region and has demonstrated a consistent approach during his time running the fund. He has access to a good depth of research at the company, which is important given the wide universe of stocks available for him to invest in.

The other fund that would be worth considering is Schroder Oriental Income that benefits from an experienced manager who has been at the company for a very long time. It has a value style due to its income focus, but there is also a quality bias. Manager Richard Sennitt’s aim is to find stocks that should be able to achieve longer term returns in order to sustain an attractive level of income.

Schroder Oriental Income is an investment trust and its shares are currently available at a 6% to the its net asset value (NAV). It has an attractive annual dividend yield of 4.68% (which is not guaranteed) and ongoing charges of 0.86%.

More on Stewart Investors Asia Pacific Leaders Sustainability

More on Fidelity Asian Smaller Companies Fund

More on Schroder Oriental Income Fund

Source:

¹ Pinebridge Investments, 20234 Asia ex Japan Equities Outlook, 10.11.23.