The Guinness Best of China Fund is designed to provide investors with exposure to the development and growth of the Greater China region through investment into Quality Companies. The Fund aims to provide long-term capital growth.
The Fund is managed for capital growth and invests in companies either listed in or deriving at least half their revenues from China, Hong Kong and Taiwan.
We believe that over the next twenty years the China story will be shaped by rising incomes, the spread of wealth and a steady rise in consumption of goods and services. China’s economy is one that is in transition from industrial and infrastructure-led growth toward a consumer oriented model.
We believe that by concentrating only on those companies that can show a long and strong track record of cash-based profitability investors can gain exposure to this story while reducing some of the risks.
Edmund Harriss has managed Asian equity portfolios since 1994. This portfolio normally consists of 33 best ideas with equal amounts invested in each position.
In brief: why invest in China?
The Greater China region is one of the most dynamic economic areas in the world; it is also one of the least understood. The economy of mainland China has grown to be the second-largest in the world and accounts for $35 for every $100 in world economic growth. The transformation that many have missed has been the development of China’s industrial complex into a producer of higher-end, higher-value products with higher wages to match. The old model of cheap goods using low-cost labour has passed and moved to Bangladesh, Cambodia, and Vietnam. The effect has been the creation of a vibrant consumer market for goods and services. The growth in online shopping and the number of transactions in ’virtual’ malls continues to dazzle ($752 bn in 2016 compared to $390 bn in the US). The future of Chinese and Taiwanese companies lies in their ability to specialise, to become indispensable to global manufacturing supply chains and to adapt to the developing domestic consumer markets.
For investors, the challenge is to identify those companies most likely to translate these themes and their competitive advantages into sustainable cash flows and profits. We believe the best way to do this is to focus on those that already have a track record of superior profitability sustained over the years which we think makes it likely this will persist. We think investors will likely make money by investing those companies whose share prices undervalue that likely persistence. The Guinness Best of China Fund aims to capture these themes by systematic identification of companies that have already demonstrated their commercial strength in this market and investing in those whose shares we believe are under-priced.
Edmund has managed Asian Funds since 1994 both from London and from Hong Kong.
Edmund worked for ten years from 1993 for Guinness Flight, which became Investec after the merger in 1998. After joining the Far East Investment Desk in 1994, he served as a member of the investment team managing the China & Hong Kong Fund (now the Guinness Atkinson China & Hong Kong Fund, for US investors). He moved to Hong Kong and became the Fund’s lead manager in 1998.
In addition, Edmund has managed the Guinness Atkinson Asia Focus Fund (for US investors) since 2003, and the Guinness Atkinson Asia Pacific Dividend Fund (for US investors) since its inception in 2006.
Edmund graduated from Christ Church, University of Oxford, with a Master’s degree in Management Studies and has a Bachelor’s degree in History from the University of York. He is also an Associate of the Society of Investment Professionals.
Edmund is manager of the Guinness Best of China Fund, and lead manager of the Guinness Asian Equity Income Fund.
Mark Hammonds, CFA
Mark joined Guinness Asset Management in 2012 and is co-manager of the Guinness Asian Equity Income Fund.
Prior to joining Guinness, Mark worked at Ernst & Young, where he qualified as a Chartered Accountant. Mark graduated from Corpus Christi College, University of Cambridge, in 2007 with a First Class degree in Management Studies. He is a CFA Charterholder.
Investment processThe Best of China Fund invests in businesses operating in the Greater China region or which derive over 50% of their revenues from the region. We focus on businesses whose competitive advantages and management skills have translated into superior financial returns consistently for at least 8 years, demonstrating stability and resilience in their business models, with low debt and a minimum market capitalisation of $500 million. We maintain a high-conviction portfolio of 30-40 equally-weighted positions with low turnover. Our portfolio contains the best stocks we can find and has no benchmark-driven constraints.
|Fund||Best of China Fund||Date (period end)||30.11.2017|
|Index||MSCI Golden Dragon||Fund Launch||15.12.2015|
|Sector||IA China/Greater China||Basis||Total return, in GBP|
Please remember that past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise as a result of market and currency movement, and you may not get back the amount originally invested.
|Cumulative performance (%)|
|X class (1) (OCF: 1.24%)||Year-to-date||1 year||3 years||5 years||From launch|
|Annualised performance (%)|
|X class (1) (OCF: 1.24%)||1 year||3 years||5 years||10 years||From launch|
|Calendar year performance (%)|
|X class (1) (OCF: 1.24%)||2012||2013||2014||2015||2016|
|Discrete year performance to date (%)|
|12 months ending:||Nov-13||Nov-14||Nov-15||Nov-16||Nov-17|
|Fund X Class (OCF: 1.24%) (1)||0.00||0.00||0.00||0.00||31.18|
|Fund C Class (OCF: 1.99%)||0.00||0.00||0.00||0.00||30.17|
(1) The performance numbers displayed here are calculated in GBP (Sterling). Please note: The Fund's X class was launched on 15/12/2015.(2) The performance of the IA China/Greater China sector average is based on the highest fee share class of each constituent fund, e.g. X class for the Guinness China & Hong Kong Fund, with an OCF of 1.24%.
Latest Guinness Asian Equity Income Fund Report
Edmund Harriss looks at what is driving the recent market retreat
Edmund Harriss discusses the meaning behind the MSCI’s decision to upgrade Chinese A shares
|For information on the Fund’s current investments, please see the latest fact sheet:||English||French||German||Italian|
|Edmund Harriss (15/12/2015),
Mark Hammonds (01/04/2017)
|Benchmark||MSCI Golden Dragon Index|
|IA sector||IA China & Greater China|
|Redemption fee||2% within 30 days of purchase|
|Underlying currency||US Dollar|
|Valuation||2300 Dublin time|
|Deal cut off time||1500 Dublin time|
|Year end||31 December|
|Administrator||Link Fund Administrators (Ireland) Ltd|
|Custodian||JP Morgan Bank (Ireland) plc|
|UK Reporting Fund status||Yes|
|0.74% OCF For early investors(1)||1.24% OCF||1.99% OCF|
|Currency||GBP||GBP, EUR, USD||GBP, EUR, USD|
|Accumulation or Distribution||Acc||Acc||Acc|
(Total ongoing charges p.a.)
|Minimum direct investment||£/€/$ 10,000||£/€/$ 10,000||£/€/$ 10,000|
|Minimum platform investment||Guinness Asset Management minimums do not apply: platforms apply their own minimum investment levels.|
|ISIN Code||GBP IE00BZ08YY02||GBP IE00BZ08YV70
|SEDOL||GBP BZ08YY0||GBP BZ08YV7
|Bloomberg ticker||GBP GUBOCZG ID||GBP GUBOCXG ID
EUR GUBOCXE ID
USD GUBOCXU ID
|GBP GUBOCCG ID
EUR GUBOCCE ID
USD GUBOCCU ID
|Country registrations||UK, CH, SGP|
- United Kingdom
- Singapore (professional only)