Neuberger has launched the Neuberger Japan Equity Fund, a UCITS vehicle that will be managed by the firm’s Japan equity team.
Managed by Keita Kubota, who has run the underlying strategy since January 2021, the fund will provide investors with access to between 35-65 high-quality Japanese companies across the full market capitalisation spectrum, identified through a research-driven approach.
The strategy applies a four-pillar scoring model that assesses the fundamentals, valuation, sustainability and engagement potential of each prospective investment. Overall, the fund will be constructed from a watch list of between 80 to 120 names that is reviewed quarterly.
Neuberger said many of the fund’s underlying businesses are benefiting from global megatrends but continue to trade at discounts to international peers due to factors such as weaker corporate governance, inefficient balance sheets and poor disclosure.
Kubota said: “Japan’s equity market has delivered a strong 18 months and global investors are seeing the region approach the end of the so-called ‘lost decades’ of deflation. The most compelling part of the opportunity still lies ahead.”
Kubota pointed to the efforts of growth-focused prime minster Sanae Takaichi, broadening earnings momentum, governance reform driving returns and capital flows remaining well below prior cycle peaks.
“An all-cap approach is uniquely positioned to capture this transformation in full, providing access not only to well-covered large-cap leaders but to the dynamic and significantly under-research mid- and small-cap segments where reform adoption is earlier-stage, informational inefficiencies are persistent and re-rating potential is most pronounced,” Kubota added.