Following The Adviser Centre Monthly Review Meeting on 28^th June 2017, Invesco Perpetual Asian has been moved to our Positive Watch list.  The fund previously featured on our Recommended list.

In our bulletin of 5^th April 2017, we communicated the news that Stuart Parks, Head of Asian Equities and co-manager of the Invesco Perpetual Asian fund, had stepped back from the day-to-day management of the fund. William Lam, who had co-managed the fund with Mr Parks since 2015, became the sole manager.  At that time, the fund remained on our Recommended list, pending further consideration.

Following a meeting with Mr Lam, we have decided to move the fund onto our Positive Watch list.  The fund continues to be managed according to the well-established philosophy that was founded by Mr Parks, but Mr Lam brings his individual investment flair and preferences to bear on the fund.

Mr Lam manages the fund in a less benchmark-aware fashion than was previously the case and there is a notable contrarian tone to his investment approach.  He works on the basis that the best companies do not necessarily represent the best investments and he is prepared to look for new ideas in unloved areas of the market where he identifies sufficient value. That said, he is also prepared to invest in optically expensive stocks if he has conviction in their long-term prospects.

Looking ahead, we expect the fund to demonstrate a more explicit value bias and there is the potential for greater variability in the fund’s risk and return characteristics compared to the benchmark.  With this in mind, we believe that a Positive Watch endorsement is more appropriate while we take time to observe the fund’s behaviour through different market conditions.

For more information about the IA Asia Pacific ex Japan sector and the funds that we feature within The Adviser Centre, please see our  IA Sector Overview.