25 May 2023: Wealth Product Ideas

Fund Name (Ticker)	JPM Japan Equity A (acc) – JPY (LU0235639324)
Description	To provide long-term capital growth by investing primarily in Japanese companies.
Asset Class	Asset
Inception Date	16/11/1988
30-Day Average Volume	N.A.
Net Assets of Fund (as of 23 May)	JPY 289.96B
12-Month Trailing Yield	N.A.
P/E Ratio (as of 23 May)	22.350
P/B Ratio	N.A.
Management Fees	1.5%

Top 10 Holdings (as of 30 April 2023)

Japan’s economy recovering after the lifting of Covid restrictions.
- Services PMI rose to a record high of 56.3 in May 2023 from 55.4 in April, showing further expansion in the service sector for the ninth consecutive month.
- Tourist arrivals have continued their upward trend, rising from 1,817,500 in March 2023 to 1,949,100 in April.
- 1Q23 GDP grew 0.4% QoQ and 1.3% YoY. GDP expanded at an annualized rate of 1.6% in 1Q23, and inflation rose to 3.5% in April.
- Nikkei Index hit a 33-year high on Tuesday (22 May 2023), up over 20% YTD.
During the recent Berkshire’s AGM, Warren Buffett believed that Japanese stocks were bargains and considered increasing stakes in the Japanese market
- Currently, Berkshire’s Japanese market holdings are worth about US$15bn, compared to the $6bn when he entered positions three years ago .
- Berkshire has raised its stakes on five Japanese stocks from about 5% in 2020 to around 7.4% across the board now.
JPY is viewed as one of the safe-haven currencies
- JPY depreciates against USD, however, it will eventually revert back to its previous levels when Japan economy recovers while US economy enters a recession, potentially returning investors with Japan market exposures FX gains.

Source: Bloomberg

Fund Name (Ticker)	Schroder International Selection Fund Global Gold (LU1223082279)
Description	The fund aims to provide capital growth in excess of the FTSE Gold Mines Index after fees have been deducted over a three to five-year period by investing in equities of companies in the gold industry.
Asset Class	Equity
Inception Date	29/06/2016
Net Assets of Fund (as of 23 May)	US$505.12M
12-Month Trailing Yield	N.A.
P/E Ratio	N.A.
P/B Ratio (as of 23 May)	1.246
Management Fees	0.75%

Top 10 Holdings

(as of 30 April 2023)

BUY Entry –120 Target – 140 Stop Loss – 110
Debt ceiling agreement
- The uncertainty surrounding the debt ceiling is likely to lead to rising market volatility as investors are concerned about the potential for a government default.
- Should a government default occur, it would lead to turmoil in the fixed-income and equity markets and the US dollars.
- Gold is seen as a hedge against market downturns.
Peak rate expectations
- Amidst a high inflation rate environment, interest rates are also being priced up in an attempt to cool down the inflationary pressures.
- The current interest rates set by the Federal Reserves now stand at 5.25%, close to its previous high since 2008.
- U.S. interest-rate futures show that markets are expecting the Fed funds rate to peak just above 5.5% by June, compared with expectations of a peak below 5%. Market also expects around 1-2 more small rate hikes left from the federal reserve.

Source: Bloomberg