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To see true potential you need to look at things differently.

JAPAN

A different perspective

Japan leading the way with automation and technology service, making more than 50% of the world’s industrial robots.

With one of the oldest populations in the world, Japan has been planning for a future with fewer workers and more retirees for sometime. With the continued advancement of technology comes greater opportunities to automate processes, improve productivity and free up human capital for higher-level activities."

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Meet the manager

A short insight into how Sophia Li, Portfolio Manager, thinks about life and investing.

About the strategy

A behind-the-scenes look at the investment philosophy for the Japan investment strategy.

Investment insights

Strong balance sheet paying off for Japanese companies

At FSSA, our investment approach focuses on identifying high-quality companies with strong management teams, dominant franchises and conservative financials. Additionally, we seek to invest in companies that have high return on invested capital (ROIC), strong and sustainable growth, and high earnings visibility.

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Japan: Finding the ‘picks and shovels’ in the electric vehicle boom

Japan is among the leading countries for automation – Japanese companies make more than 50% of all industrial robots and computer-controlled systems globally.

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How we invest

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Diversified and differentiated

The Japanese investment universe provides diversification, while bottom-up stock selection and high active share^ differentiates our portfolios from the benchmark index.

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High conviction investments

A focused portfolio of 40 to 60 companies ensures that only the highest conviction investment ideas are included.

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Integrated ESG analysis

ESG analysis, shareholder engagement and proxy voting is fully integrated into the investment process.

Investment themes

FSSA’s Japan equity portfolios are built company by company from the bottom up, with little regard for index positioning.  We are focused on growth in an absolute return* sense and construct portfolios of high quality companies with effective management teams, long-term, sustainable growth drivers and strong financials. Despite the perception that there is no growth in Japan, our core portfolio holdings have been able to adapt and grow despite economic headwinds, and have delivered sustainable earnings growth and attractive shareholder returns. 

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'Hidden gems' with growth potential

We aim to uncover high-quality, dominant franchises that can sustain strong and consistent earnings growth without relying on leverage or macro conditions. Often, these companies incorporate some combination of innovation, disruption or overseas expansion.

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Niche industries with few competitors

In niche sectors with just one or two dominant companies, the leading franchises tend to maintain their market position as there are no significant rivals to compete with. This can lead to sustainably high returns for investors.

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Growing trend of automation

As robots become smarter and less costly, manufacturers have started to automate to address labour shortages while improving efficiencies at the same time.

Dominant consumer franchises

Japanese consumer brands benefit from a strong following in the Asia Pacific region, with Chinese consumers in particular forming a large market for 'Made in Japan' products. 

^ Active share is a measure of the percentage of stock holdings in a portfolio that differs from the benchmark
* Absolute return is the return that an asset achieves over a specified period