The Guinness Asian Equity Income Fund is designed to provide investors with exposure to high quality dividend-paying companies in the Asia Pacific region. The Fund aims to provide long-term capital appreciation and a source of income that has the potential to grow over time.

The Asian region is made up of a mix of advanced, high-income economies and newly industrialised countries that are home to 54% of the world’s population. Industrialisation brings with it increased wealth, improved standards of living and a vast consumer market that attracts both domestic and international brands.

China‘s 19 million passenger car market makes it a magnet for US, European and Japanese carmakers. Its manufacturing capabilities are unmatched in cost and scale, from clothes to electronics to ships. They make China the world’s largest trader of goods valued at over $4 trillion. South Korean and Taiwanese companies dominate the production of computer chips and personal electronic devices. India has 900 million mobile phone subscribers but only 110-120 million have a smartphone. This is the next big smartphone market. But high growth and rapid development is often accompanied by volatility and risk.

We focus on profitable companies (in cash terms) that have generated persistently high return on capital over the last eight years, demonstrating stability and resilience. Historically, companies in our universe have gone on to deliver significant dividend growth. We believe strong cash generation and its distribution as dividends also provide a degree of downside protection against volatility in local markets.

We maintain a high conviction portfolio of around 30-40 equally-weighted positions with a minimum market capitalisation of $500 million, with low turnover and no benchmark-driven constraints on sector and regional weightings.

Awards & Ratings
LIPPER_FA_AWARD_HOR_SWITZERLAND Guinness Asian Equity Income Fund
Elite Rated
Fund Calibre


Quick links

Update | Jun '21

Quarterly Update

Insight | Jan '20

The Case for Dividend Investing in Asia 
This paper seeks to show how Asia has become an important destination for income investors.

Press | May '21 | Interactive Investor

How I find high-quality dividend shares
Edmund Harriss – co-manager of the Guinness Asian Equity Income Fund – discusses with Interactive Investor’s Kyle Caldwell how he and co-manager Mark Hammonds go about identifying high-quality dividend-paying companies in the Asia Pacific region.

Press | Feb '21 | Interactive Investor

Fund spotlight: Guinness Asian Equity Income review 2021
Interactive Investor analyst Teodor Dilov offers his view on one of ii’s Super 60 trust picks.

Why invest in the Guinness Asian Equity Income Fund?

The Fund is designed to provide investors with exposure to Asian equities through a high conviction, low turnover portfolio of consistently profitable dividend-paying companies.

Focus on consistent high return on capital
Consistent high return on capital is a good indication of a company’s durability, and its ability to pay healthy dividends. The Fund invests in companies that are unusually consistent in generating returns on capital above their cost of capital.
Growth and income
Our approach to dividend investing is to focus on companies that can sustainably grow their dividend into the future, rather than simply looking for companies with a high dividend yield.
High conviction
The Fund typically invests in 36 companies, with each company having an equal weighting. This provides a good balance between the benefits of diversification while also allowing each company to add meaningfully to performance. We don’t have a long tail of small positions and by definition we can never just ‘hug’ the benchmark index.
Fundamentally driven
We focus on ‘bottom-up’ stock selection rather than trying to make decisions based on an expected outlook for the region’s economy. We like to invest in good companies that have, in the short term, fallen out of favour, but that have previously shown an ability to weather most economic environments over time.
Low turnover
We prefer to invest over the long term. We also recognise the increased costs of trading in and out of companies unnecessarily. Typically we will hold a company in the portfolio for between three and five years.
Repeatable and independent
Edmund Harriss and analyst Mark Hammonds have managed the Fund since launch. They have developed an investment process that is clear, robust, transparent, and scalable. Their approach filters out much of the noise and hype that surrounds companies to focus on the true signals that drive company valuations. By performing their own company research and analysis, using their own proprietary modelling systems, the managers try to avoid some of the behavioural biases associated with being unduly influenced by market sentiment.

The Fund is designed to give investors exposure to one of the world’s fastest growing regions, which will have a significant influence over our economic future. However, with change and opportunity comes risk. We seek to manage this by investing in companies that:

  1. have a proven record of generating returns in excess of the cost of capital;
  2. can successfully reinvest those returns in order to grow their business; and,
  3. are committed to paying dividends to shareholders that can grow over time.

The case for Asian equities

Asia’s developed and emerging economies

The Asia Pacific region includes both developed and emerging economies, and is home to 54% of the world’s population (4.1 billion people). Its population is still younger than the developed world, and is getting richer. While western economies struggle to sustain economic growth, it is Asia’s dynamism, expanding population and increasing wealth that will shape our economic future. If you believe successful investing is about recognising patterns of change to identify value and opportunities for wealth creation, then Asia is the place to look.

Asia has diversified

The Asian economies used to be dominated by commodities and export manufacturing for the developed markets of the US and Europe. The region has mobilised its resources for the production not only of raw materials but also the full range of manufactured goods (from cheap clothing to top-of-the-range electronics). The focus on industrialisation and the steady increase in the value of goods being produced has been accompanied by higher wages and has raised household incomes. This provides the underpinning for an expanding consumer economy with many more economic participants and higher volumes of transactions. The benefits over time have been reduced volatility in regional economic performance and from an investment perspective, has promoted a flowering of consumer discretionary and services businesses to cater to this growing consumer class. Asia is now no longer simply the workshop of the world but with its growing affluence is now a key marketplace for cars, phones, clothing, luxury goods as well as for health care and financial services.

“Rather than rely on production of resources like other emerging markets do, Asia has mobilised its resources for the production of the full range of manufactured goods, and is plugged into the global manufacturing network.”

Asian economics and politics have matured

Having learned from its own 1998 experience, the region did well through the recent financial crisis. Governments, companies and the financial sector were not over-extended, while companies curbed their expansionary instincts and focused on cash flow generation and profit, leading to a step change improvement in companies return on investment.

Fundamental change to government and society is most often propelled by economic forces. Asia’s experience is no different. Increased individual wealth and economic participation has been followed by increased political engagement as people demand a voice in shaping their and their children’s future. A demand for government accountability has meant more intensely contested elections, usually now won with a commitment to long-term economic planning and reform. Stock market regulation, accounting and disclosure have improved as financial systems respond to market needs.

There is a long-term investment opportunity in Asia. But opportunity and risk go hand-in-hand; the key for investors is finding proven companies and constructing the right portfolio to manage that trade-off.

Fund managers

Edmund Harriss

Edmund Harriss

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 head of Asian and Emerging Markets investments.

Mark Hammond

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.

How do we run the Fund?

“We don’t chase yield, we want capital and dividend growth.”

Although the Fund is designed to invest in dividend-paying companies, our starting point in selecting our investment universe is to identify companies with consistently high return on capital. Specifically we look at companies that have a return on capital greater than 8% (in real terms) in each of the previous eight years.

Our analysis shows that companies with persistently high return on capital are highly likely to continue to do so in the future – meaning they will continue to create shareholder value.

Why 8% and why eight years?
8% return on capital… 8% is well above the average real cost of capital of 6%. This means companies who achieve this level are truly creating value for their shareholders.
…every year… Consistency each year excludes highly cyclical companies or those with high but declining or volatile earnings.
…for eight years Eight years of high returns gives us confidence that those returns should persist into the future.
“There is a long-term investment opportunity in Asia. But opportunity and risk go hand-in-hand. The key in Asia is finding proven companies and constructing the right portfolio to manage that trade-off.”

On average, only about 7% of Asian listed companies achieve our threshold. We then exclude those less than $500 million in size or with a debt to equity ratio greater than 1. This gives us a pool of around 300 companies from which to build our portfolio.

What about yield?

Companies that earn a consistent high return on capital often distribute a proportion of cash they create in the form of a dividend. In the Fund, however, we focus in particular on those companies that can sustainably grow their dividend into the future.

From this pool we then select candidates for extended research on the basis of value and sentiment. In depth proprietary modelling of a company’s cash flow, capital budgeting and potential for dividend growth is combined with a subjective analysis of its business model to identify candidates for inclusion in the final portfolio.

By selecting companies from a broad range of industries, countries, and market capitalisation we aim to create a well-diversified portfolio which can provide a reasonable dividend yield and growing income stream at an attractive valuation relative to Asian equity markets.

Sell discipline

It is often easier to find companies to buy that look cheap than it is to identify those companies you own which should be sold. We consider sell discipline as important as selecting companies for purchase and continuously monitor the companies we hold in the Fund. The six core reasons we may sell a company are outlined below.

  1. The company fails to continue to meet our return on capital criteria
  2. The valuation becomes too rich
  3. The balance sheet becomes stretched
  4. The dividend outlook or management policy to dividends changes unfavourably
  5. The original investment thesis no longer holds, or a new idea is more compelling
  6. Yield contribution to the portfolio is insufficient

How do we construct the portfolio?

The Guinness Asian Equity Income Fund is a concentrated portfolio of around 36 equally weighted stocks. This provides a number of useful attributes:

  1. It reduces stock-specific risk, as we will not be overweight in a small number of favourite companies.
  2. We will not have a long tail of small holdings in the portfolio, which can be a distraction and a potential drag on performance.
  3. It instills a strong sell discipline as we must typically sell a position in order to make way for a new one; and we must constantly assess the companies we own in the portfolio in comparison to the rest of the universe available to us.
  4. We are truly index independent. All companies held are weighted equally without regard to their weighting in the benchmark index, leading the portfolio to have a high active share.
Fund Asian Equity Income Fund Basis Total return, in GBP
Index MSCI AC Pacific ex Japan Index Date (period end) 31.08.2018
Sector IA Asia Pacific ex Japan Fund Launch 19.12.2013

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 (GBP, %)
Y class (OCF: 0.99%) Year-to-date 1 year 3 years 5 years From launch (19/12/2013)
Fund 0.35 1.19 68.70 0.00 91.65
Index -0.65 1.84 71.22 65.03 65.75
Sector -1.66 1.57 65.19 66.93 65.62
Annualised performance (GBP, %)
Y class (OCF: 0.99%) 1 year 3 years 5 years 10 years From launch (19/12/2013)
Fund 1.19 19.02 0.00 0.00 14.84
Index 1.84 19.61 10.53 9.94 11.35
Sector 1.57 18.19 10.79 9.61 11.33
Calendar year performance (GBP, %)
Y class (OCF: 0.99%) 2013 2014 2015 2016 2017
Fund 0.00 17.59 1.16 28.23 24.64
Index 2.00 7.81 -4.41 28.19 25.06
Sector 1.85 9.47 -3.35 0.00 25.34
Discrete year performance to date (GBP, %)
Y class (OCF: 0.99%) Aug-14 Aug-15 Aug-16 Aug-17 Aug-18
Fund 0.00 1.06 32.65 25.59 1.19
Index 11.04 -13.20 33.57 25.77 1.84
Sector 12.60 -10.25 31.84 23.27 1.57
Source: Financial Express, bid to bid basis, total return.

Latest Guinness Asian Equity Income Fund Report

May '21

Monthly Update

Mar '21

Monthly Update

Feb '21

Monthly Update

Dec '20

Monthly Update

Nov '20

Monthly Update

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Jan '20

The Case for Dividend Investing in Asia 
This paper seeks to show how Asia has become an important destination for income investors.

Jul '18

The Reality of Tariffs

The Guinness Asian Equities team assess the impact of the recently imposed tariffs

Dec '17

Asian markets retreat – 6th December 2017

Edmund Harriss looks at what is driving the recent market retreat

Sep '17

Some thoughts on equally-weighted portfolios
Matthew Page explores the reasons behind running a concentrated, equally-weighted portfolio.

Jun '17

Is inclusion into MSCI benchmarks a game changer for China A shares?

Edmund Harriss discusses the meaning behind the MSCI’s decision to upgrade Chinese A shares

Mar '17

Blue skies thinking in China

Edmund Harriss explains how a drive to reduce smog in China could also help to tackle one of the country’s main economic challenges: excess industrial capacity and associated debt.

Jul '16

Implications for Asian investing of the UK leaving the EU Edmund Harriss discusses the consequence of the UK’s decision to leave the EU.

Feb '16

2015 performance & portfolio review
Edmund Harriss discusses how the portfolio has performed in 2015.

Jun '15

How Asia avoided a commodity crisis
Edmund Harriss discusses Asia’s industry and services-led growth and mobilisation of its work force, which have enabled the region – unlike other emerging markets – to avoid the worst of the commodity price slump.

Mar '14

Physics envy
Matthew Page investigates the “science” of economic modelling

Nov '12

To meet or not to meet
Matthew Page discusses the merits of meeting company management

Mar '12

Why dividends matter
Ian Mortimer and Matthew Page investigate the importance of dividends in the pursuit of returns


May '21

How I find high-quality dividend shares
Edmund Harriss – co-manager of the Guinness Asian Equity Income Fund – discusses with Interactive Investor’s Kyle Caldwell how he and co-manager Mark Hammonds go about identifying high-quality dividend-paying companies in the Asia Pacific region.

Feb '21

Fund spotlight: Guinness Asian Equity Income review 2021
Interactive Investor analyst Teodor Dilov offers his view on one of ii’s Super 60 trust picks.

Apr '20

Coronavirus ii Super 60 Update: Guinness Asian Equity Income
An update on the ii Super 60 rated Guinness Asian Equity Income Fund, brought to you by Interactive Investor’s analysts.

Jan '20

The Top Four Funds and Trusts Investing in China
Ahead of Chinese New Year, Interactive Investors’ funds analysts pick their favourite ways of gaining exposure to this exciting market.

Oct '19

Three high-yielding funds for income-hungry investors
With dividend payouts in the UK experiencing their worst quarter in three years, Interactive Investor highlights three high-yielding income strategies worth considering.

May '19

Diversify your income with Guinness Asian Equity Income
Increasing numbers of Asian companies now pay a dividend and have the resources to support wider growth.

Dec '18

Changing Asia: Which country is the New China?
Trade patterns in Asia are transforming as nations race to fill up the manufacturing space being left behind by China.

May '18

Should investors be concerned about global trade tensions?
Mark Hammonds talks to Investment Week about the recent escalation in trade tensions between the US and China

Nov '17

Guinness’ Harriss: The overlooked yet lucrative market for income investors
Edmund Harriss, who heads up the five FE Crown-rated Guinness Asian Equity Income fund, tells FE Trustnet why the best income opportunities reside in China despite widespread debt-related fears.

Oct '17

China Special: Why S&P has missed the mark with China downgrade
China’s credit rating was recently downgraded by Standard & Poor’s (S&P) from AA- to A+ because of worries over the rapid growth of the country’s debt.

Jul '17

Mark Hammonds to co-manage the Guinness Asian Equity Income Fund
Tom Eckett of Investment week comments on the recent promotion of Mark Hammonds

Jun '15

Can this tiny Fund rival Newton Asian Income?
Investment Week’s Natalie Kenway alights on Guinness Asian Equity Income in the aftermath of manager change at one of the sector’s giants.

Mar '15

The tiny Asia fund that’s outperforming its massive rivals
FE Trustnet’s Lauren Mason says the one-year-old Guinness Asian Equity Income fund has enough conviction to stand up to giant, well-established competitors like Newton Asian Income.

Key facts
Launch date 19/12/2013
Investment team
(start date)
Edmund Harriss (19/12/2013)
Mark Hammonds (19/12/2013)
Benchmark MSCI AC Pacific ex-Japan Index
IA sector IA Asia Pacific ex Japan
Structure OEIC (UCITS)
Domicile Ireland
Underlying currency US Dollar
Pricing Daily, forwards
Valuation 2300 Dublin time
Deal cut off time 1500 Dublin time
Administrator Link Fund Administrators (Ireland) Ltd
Custodian Brown Brothers Harriman
UK Reporting Fund status Yes
ISA Eligible Yes
Share classes
ClassOCF currentMax. Initial ChargeMin. InvestmentISINSEDOLBloomberg
Guinness Asian Equity Income Fund C EUR Acc1.99%5%€ 0IE00BGHQDM52BGHQDM5GAEICEA ID
Guinness Asian Equity Income Fund C GBP Acc1.99%5%£0IE00BVYPNP33BVYPNP3GAEICGA ID
Guinness Asian Equity Income Fund C USD Acc1.99%5%$0IE00BVYPNQ40BVYPNQ4GAEICUA ID
Guinness Asian Equity Income Fund I USD Acc0.89%0%$10,000,000 IE00BMYPN051BMYPN05
Guinness Asian Equity Income Fund I USD Dist0.89%0%$10,000,000 IE00BMYPN168BMYPN16
Guinness Asian Equity Income Fund Y EUR Acc0.89%5%€ 0IE00BDHSRG22BDHSRG2GAEIYEA ID
Guinness Asian Equity Income Fund Y EUR Dist0.89%5%€ 0IE00BDHSRH39BDHSRH3GAEIYED ID
Guinness Asian Equity Income Fund Y GBP Acc0.89%5%£0IE00BDHSRD90BDHSRD9GAEIYGA ID
Guinness Asian Equity Income Fund Y GBP Dist0.89%5%£0IE00BDHSRF15BDHSRF1GAEIYGD ID
Guinness Asian Equity Income Fund Y USD Acc0.89%5%$0IE00BDHSRJ52BDHSRJ5GAEIYUA ID
Guinness Asian Equity Income Fund Y USD Dist0.89%5%$0IE00BDHSRK67BDHSRK6GAEIYUD ID
Guinness Asian Equity Income Fund Z GBP Dist0.74%0%ClosedIE00BGHQDV44BGHQDV4GAEIZSD ID