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Japanese Equity Fund

Seeking to uncover the best investment opportunities across the Japanese equity spectrum.

ISIN LU1127970256 Bloomberg TRJAPEQ:LX

3YR Return Annualised
(View Total Returns)

Total Assets


1YR Return
(View Total Returns)

Manager Tenure


Information Ratio
(5 Years)

Tracking Error
(5 Years)


Inception Date 28-Oct-2014

Performance figures calculated in EUR

Other Literature

31-May-2020 - Archibald Ciganer, Portfolio Manager,
Although Japan is exposed to the global economic cycle, we believe there is potential upside in share prices when the coronavirus pandemic stops getting worse. Japanese companies are net cash on the balance sheet and many of the holdings within our portfolio are exposed to themes that are likely to be expedited by the pandemic, such as the shift from offline to online in the form of e-commerce and factory automation.
Archibald Ciganer
Archibald Ciganer, Portfolio Manager

Archibald Ciganer is the portfolio manager of the Japan Equity Strategy in the International Equity Division. He is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price Japan, Inc.

Click for Manager Outlook


Manager's Outlook

The focus now is on the depth of the economic recession we are facing and the duration of the social restrictions to control the coronavirus. Encouragingly, policy stimulus has been swift and decisive; this should help soften the recession and buy time for companies and consumers facing near-term cash flow pressures. Corporate Japan is cash rich, which is providing the local market with some respite as investors generally flee any sign of balance sheet risk.

Against this uncertain backdrop, an increasing number of Japanese companies are defying skeptics by transforming business practices and governance standards. We believe this can help corporate profit growth and generate improving shareholder returns. The volume of shareholder buybacks is increasing while merger and acquisition activity also shows promise.

Japan is more exposed to the global economic cycle than many markets, and, therefore, there will be volatility in the near future, but also significant potential upside when things stop getting worse.

Investment Objective

To increase the value of its shares, over the long term, through growth in the value of its investments. The fund invests mainly in a widely diversified portfolio of stocks of companies in Japan.

Investment Approach

  • Macroeconomic factors have a role, but our approach is primarily bottom-up and research driven.
  • Growth opportunities are found across the capitalization spectrum and across market sectors.
  • Risk is managed at stock, sector, and cap-range levels.
  • Portfolio rebalancing is an effective risk management tool.

Portfolio Construction

  • Typically 80-110 stock portfolio
  • Minimum individual position size is 0.40%
  • Individual position sizes can range +/- 2.00% relative to the benchmark
  • Sector weightings vary from +/- 10% of the benchmark
  • Tracking error expected to range between 300 and 600 bps
  • Target reserves less than 5%

Performance (Class Q)

Annualised Performance

  1 YR 3 YR
5 YR
Since Inception
Fund % 19.31% 9.43% 9.80% 14.38%
Indicative Benchmark % 6.74% 3.18% 3.15% 8.68%
Excess Return % 12.57% 6.25% 6.65% 5.70%

Inception Date 28-Oct-2014

Indicative Benchmark: TOPIX Index Net

Data as of  31-May-2020

Performance figures calculated in EUR

  1 YR 3 YR
5 YR
Since Inception
Fund % -1.01% 3.31% 6.16% 11.13%
Indicative Benchmark % -5.43% -0.30% 1.71% 7.03%
Excess Return % 4.42% 3.61% 4.45% 4.10%

Inception Date 28-Oct-2014

Indicative Benchmark: TOPIX Index Net

Data as of  31-Mar-2020

Performance figures calculated in EUR

Recent Performance

  Month to DateData as of 02-Jul-2020 Quarter to DateData as of 02-Jul-2020 Year to DateData as of 02-Jul-2020 1 MonthData as of 31-May-2020 3 MonthsData as of 31-May-2020
Fund % -0.81% -0.81% 1.42% 7.56% 14.98%
Indicative Benchmark % -0.76% -0.76% -8.45% 4.40% 3.40%
Excess Return % -0.05% -0.05% 9.87% 3.16% 11.58%

Inception Date 28-Oct-2014

Indicative Benchmark: TOPIX Index Net

Indicative Benchmark: TOPIX Index Net

Performance figures calculated in EUR

Past performance is not a reliable indicator of future performance.  Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures. 

Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.

Index returns shown with reinvestment of dividends after the deduction of withholding taxes. 

Effective 1 June 2019, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly.

31-May-2020 - Archibald Ciganer, Portfolio Manager,
Japanese equities continued to rebound in May, outperforming their developed market peers on news that Prime Minister Shinzo Abe was lifting the state of emergency for the remaining five prefectures that were still on lock-down orders. The unveiling of stimulus packages that in total represent approximately 40% of Japan’s annual GDP also boosted sentiment. Within the portfolio, the best-performing stock was Chugai Pharmaceutical, on news that the company had started a clinical trial of rheumatic drug Actemra for the treatment of the symptoms of COVID-19, the disease caused by the coronavirus, with the aim of gaining production/sales approval by the end of this year. Keyence, a maker of machine vision systems and sensors for factories, was another strong performer. Keyence outsources fabrication and enables companies to automate production and has benefitted during the coronavirus outbreak due to investors’ preference for companies that eliminate humans from the process. In contrast, our overweight in Miura dragged, as shares were subject to profit taking after a strong run of performance. The manufacturer of boilers and ballasts generates relatively stable earnings on its defensive and durable domestic business. Furthermore, much of its growth comes from China, so the country's reopening has helped.


Largest Holding Miura 5.21% Was (31-Dec-2019) 3.91%
Other View Full Holdings Quarterly data as of 31-Mar-2020
Top 10 Holdings 34.91% View Top 10 Holdings Monthly data as of 31-May-2020

Largest Top Contributor^

By 0.11%
% of fund 5.20%

Largest Top Detractor^

By -1.33%
% of fund 4.00%


Quarterly Data as of 31-Mar-2020

Top Purchase

Chugai Pharmaceutical
Was (31-Dec-2019) 3.16%

Top Sale

Calbee (E)
Was (31-Dec-2019) 1.22%

Quarterly Data as of 31-Mar-2020

31-Mar-2020 - Archibald Ciganer, Portfolio Manager,

We made no major changes in terms of portfolio positioning or the stocks we hold over the quarter.

At the margin, we took advantage of some of the price discrepancies we have seen during the volatility; we eliminated some stocks that have rallied because of the coronavirus pandemic and added to several names that we have wanted to own for some time but were previously too expensive.

IT and Services

IT and services remains, by far, the portfolio's largest overweight, with significant positions in communications names including SoftBank, Nippon Telegraph & Telecommunications, and NTT DoCoMo. We are bullish on the industry, specifically the scope for improving earnings, while valuations also look attractive.

In the sector, we established a new position in Oriental Land Company, the operator of Tokyo Disney Resort. The stock plunged on the coronavirus pandemic and its impact on tourism. If we value the company's real estate and earnings potential, we find the stock trades at highly attractive valuations-the near-term volatility provided an attractive entry point, given our long-term investment horizon.

We also added a holding in Net One Systems, which specializes in network products and services in Japan with a top share in Cisco products. It is a strong durable growth company with network infrastructure and cloud computing. The company sells hardware but also provides higher-margin network design and monitoring. Shares in the company sold off on allegations of spurious accounts; however, our research leads us to believe there is no wrongdoing by the company. The sell-off provides an attractive opportunity to buy a company with strong tailwinds that have been further accelerated by the coronavirus and the emphasis on remote working.

Raw Materials and Chemicals

In the raw materials and chemicals sector, we added a holding in Fancl, a cosmetics and nutritional supplements manufacturer. The brand is mainly marketed through direct sales and mail order, but also through retail stores. Overseas sales are small but increasing, while inbound tourism provides scope for growth. The coronavirus pandemic resulted in a large sell-off in the name and provided an opportunity to buy the stock, which we believe has previously been too expensive. The company's long-term growth outlook and margin expansion potential underpin our investment thesis.

Conversely, we exited our position in Fujifilm. The company generates strong and stable cash from its businesses in imaging (camera, photo film) and also medical equipment and pharmaceuticals. The stock rallied strongly on news that China was having some success treating COVID-19, the disease caused by the coronavirus, with Fujifilm's drug, but the company's drug is off-patent and generics exist. The outperformance was marked, and we sold the company into this strength.


We moved further underweight the foods sector. We sold our holding in Coca-Cola Bottlers, Japan's largest bottler by revenue. Our investment thesis was predicated on the company's new management being able to turn around the business. While management has been keen to make progress on this, the group's restrictive structure has been an impediment.

We also exited our position in Calbee, Japan's top manufacturer of salty snacks and the fifth largest globally. Our thesis was around the U.S. business improving and domestic margins expanding, but execution remains poor.


Largest Sector It & Services & Others 38.84% Was (30-Apr-2020) 37.90%
Other View complete Sector Diversification

Monthly Data as of 31-May-2020

Indicative Benchmark: TOPIX Index

Top Contributor^

Communication Services
Net Contribution 1.10%
Selection 0.56%

Top Detractor^

Consumer Staples
Net Contribution -0.82%


Quarterly Data as of 31-Mar-2020

Largest Overweight

It & Services & Others
Fund 38.84%
Indicative Benchmark 17.31%

Largest Underweight

Fund 0.00%
Indicative Benchmark 5.08%

Monthly Data as of 31-May-2020

31-May-2020 - Archibald Ciganer, Portfolio Manager,
Our positioning across sectors and themes was broadly unchanged over the month. We remain focused on our valuation discipline and are looking for opportunities to buy high-quality companies that have been overly discounted. We are also interested in companies with exposure to emerging markets and inbound tourism, which are facing near-term challenges but are attractive in the long run. We have taken some profits in our holdings that have outperformed significantly, but where the long-term investment thesis remains intact.

Team (As of 02-Jul-2020)

Archibald Ciganer

Archibald Ciganer is the portfolio manager of the Japan Equity Strategy in the International Equity Division. He is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price Japan, Inc.

Archibald’s investment experience began in 1999, and he has been with T. Rowe Price since 2007, beginning in the International Equity groupDivision. Archibald began his career as a credit analyst with BNP Paribas in Japan. Subsequently, he served as an associate in the firm'sBNP’s Investment Banking Department and, most recently, as a vice president in Mergers and Acquisitions, where he handled a number of cross-border transactions for blue chip Japanese and foreign corporates.

Archibald earned a B.A. in finance and accounting from Institut d'Etudes Politiques de Paris (sSciences pPo.). Archibald He also has also earned the Chartered Financial Analyst® designation.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

  • Fund manager
  • Years at
    T. Rowe Price
  • Years investment
Laurence Taylor

Laurence Taylor is a portfolio specialist in the Equity Division at T. Rowe Price, representing the firm's global equity strategies to institutional clients, consultants and prospects. Mr. Taylor is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Mr. Taylor has 19 years of investment experience, 10 of which have been with T. Rowe Price. Prior to joining the firm in 2008, Mr. Taylor was a quantitative portfolio manager at AXA Rosenberg, with responsibility for European institutional clients, and began his career at Hewitt Associates in the UK investment practice. At Hewitt, Mr. Taylor provided investment advice to European institutions as a client-facing consultant before specializing in the research and selection of global and regional equity managers in the manager research team.

Mr. Taylor obtained his B.A., with honours, from Greenwich University and has earned the Chartered Financial Analyst designation.

  • Years at
    T. Rowe Price
  • Years investment

Fee Schedule

Share Class Minimum Initial Investment and Holding Amount (EUR) Minimum Subsequent Investment (EUR) Minimum Redemption Amount (EUR) Sales Charge (up to) Investment Management Fee (up to) Ongoing Charges
Class A €1,000 €100 €100 5.00% 160 basis points 1.71%
Class I €2,500,000 €100,000 €0 0.00% 75 basis points 0.81%
Class Q €1,000 €100 €100 0.00% 75 basis points 0.86%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.

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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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