T. Rowe Price Japan Fund
The T. Rowe Price Japan Fund (PRJPX) states that it seeks “long-term growth of capital through investment in the common stocks of companies located, or with primary operations, in Japan.”
The fund house is of the view that even though economic growth in Japan has slowed, several important aspects of a productive economy remain firmly in place. Aspects like “a strongly motivated work force and first-class technical and production capabilities” are important to an economy and remain unscathed in Japan.
The T. Rowe Price Japan Fund (PRJPX) is well diversified with 78 holdings as of December 2015. It was managing assets worth $330.08 million at the end of December. As of December, its equity holdings included Astellas Pharma, Inc. (ALPMY), Fujifilm Holdings Corporation (FUJIY), Nintendo Co. Ltd. (NTDOY), NTT DoCoMo, Inc. (DCM), and SoftBank Group Corp. (SFTBY), comprising 10.0% of the fund’s portfolio.
For this analysis, we will be considering PRJPX’s holdings as of September 2015, which is the latest available complete portfolio. The post-September holdings reflect the valuation-driven changes to the portfolio, not the actual holdings. The fund declares its holdings once in a quarter.
PRJPX has industrials at its core, with the sector forming over a quarter of the fund’s portfolio. Apart from having industrials at the core, the fund manager has increased exposure to this sector in 2015. Stocks from the consumer discretionary sector form a fifth of the fund’s portfolio. But unlike industrials, exposure to the sector has been reduced compared to a year ago.
Information technology, financials, telecom services, and consumer staples command 10%–12% of the fund’s assets each. However, they have been dealt with differently during the year. Although exposure to staples and information technology sectors increased, financials saw a sharp decline in share.
On the other hand, exposure to telecom services fluctuated from 9%–11% for 2015. Apart from financials, healthcare has been another sector that has seen a sharp drop in exposure. The fund is not invested in the energy and utilities sectors.
In the next article, we’ll look at how the PRJPX performed in 2015.