Fidelity Japan Trust PLC has announced a number of changes to the Company

  

Key points

  • Greater flexibility to invest in large cap companies and more unlisted stocks
  • New Variable Management Fee to be introduced in July with a base fee of 0.70% of net assets
  • Company name change to Fidelity Japan Trust PLC

Changes to investment objective and company name

Shareholders have approved Board proposals to amend the Company’s investment objective to better reflect the portfolio manager’s investment approach to include a greater weighting to large market cap companies. This will allow greater flexibility to move between market capitalisation segments as opportunities arise in the future.

New investment objective:

The Company aims to achieve long term capital growth by investing predominantly in equities and their related securities of Japanese companies.

To reflect the change above and Nicholas Price’s focus on picking stocks with growth at a reasonable price, the Company has changed its name to Fidelity Japan Trust PLC.

The introduction of a variable management fee

The Board has also negotiated a new fee agreement with the manager, following Fidelity International’s announcement in October last year to offer its clients a Variable Management Fee. 

As of 1 July 2018 the headline management fee of 0.85% of gross assets will be reduced to 0.70% of net assets per annum with a +/- 0.20% variation based on performance relative to the Reference Index. The maximum fee that the Company will pay will be 0.90% of net assets, but if the Company underperforms the Index, the overall fee could fall as low as 0.50%.

A change of reference index

The Board has considered a number of reference indices and has decided that the Company should move from using the Russell Nomura Mid/Small Cap Index to the TOPIX Index (Tokyo Stock Exchange TOPIX Total Return Index), the most widely used index representing the Japanese equity market and also the most inclusive index in terms of constituents. 

A change of peer group 

The Company will move from the Association of Investment Companies (“AIC”) Japan Smaller Companies peer group to the AIC Japan peer group.
 

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