Performance evaluation of the Invesco Asia Pacific Growth Fund
The Invesco Asia Pacific Growth Fund Class A (ASIAX) has had a great 2016 so far. It’s a top performer among the nine funds in this review. In the one-year period ended June 24, 2016, the fund placed third.
We’ve graphed the fund’s performance against the iShares MSCI All Country Asia ex Japan ETF (AAXJ) and the WisdomTree Asia Pacific ex-Japan ETF (AXJL). Let’s look at what has contributed to the fund’s stellar performance YTD (year-to-date) in 2016.
Portfolio composition and contribution to returns
Materials, which is ASIAX’s fifth-largest invested sector, has emerged as the biggest contributor to its returns YTD in 2016. Both stocks from the sector, Lee & Man Paper Manufacturing and Amcor, have contributed positively.
Financials has been edged into second place. Though Metro Pacific Investments and other stocks have helped the sector, it has been denied first place due to negative contributions from Hongkong Land and Industrial and the Commercial Bank of China.
Both consumer-focused sectors have been sizable positive contributors as well. China’s MINTH Group towers above all other stocks from the consumer discretionary sector. However, its hard work has been hampered substantially by Hong Kong’s Stella International. Meanwhile, pork company WH Group has buoyed consumer staples.
Among individual stocks, Broadcom (AVGO), Taiwan Semiconductor Manufacturing Company (TSM), and Philippine Long Distance Telephone Company (PHI) have contributed positively, while NetEase (NTES) has contributed negatively.
ASIAX has far outperformed the passively managed AAXJ. Its portfolio turnover is quite low compared to its peers’. Its focus on mid- and small-cap equities is unique, and its stock selection in most of its top sectors has been good, which has resulted in a stellar performance so far in 2016.
However, some investors may not be comfortable with the market cap focus of the fund. Apart from these investors, others can consider ASIAX in their shortlists for investing in the Asia ex-Japan region.
Let’s now move to the Columbia Asia Pacific ex-Japan Fund Class A (CAJAX).