Barings Launch New Japanese Equity Fund

Stephen Harris

4 July 2005

Baring Asset Management in the UK has launched a Japanese equities hedge fund to take advantage of cheap valuations in that market, particularly smaller stocks not followed by brokers. The long/short Baring Japan Absolute Return Fund will appeal to institutional and private investors who are looking for exposure to Japan, but are worried about economic growth in the country and want to limit the downside risk on their investments, according to Barings "Now is the time to invest in Japan," Joji Maki, Baring Asset Management's head of Japanese equities said. "We believe that Japan has not fulfilled its potential in the last year and that there are considerable opportunities for investors on the ground," he added. Only about 30 per cent of the most liquid Japanese companies are covered by broker research as many banks and brokers cut the companies they covered after Japan's stock market crashed in the early 1990s. Many new hedge funds are looking to Japan hoping to cash in on cheap valuations. Baring's Japan fund will charge annual management fees of 1.5 per cent, and performance fees of 20 per cent. It will be listed on the Irish stock exchange. It will be leveraged up to 120 per cent and the minimum investment is €200,000 or $250,000.