Man Japan CoreAlpha Professional Class - Income (GBP)

The fund has an excellent long-term track record. Since launch in January 2006 its returned more than the broader Japanese stock market. Our analysis puts this down to strong stock picking.

Investing in unloved companies won't always work though. It can take time for a company's share price to recover following a disappointment and shorter-term periods of weaker performance should be expected.

Since Atherton joined the team as co-manager in 2011, the fund's lagged the broader Japanese stock market. The teams investment style has largely been out-of-favour over the years and because of their 'deep value' focus, the fund's performance has been put under more pressure than most. Value companies performed particularly poorly since the start of 2020 amid the coronavirus crisis.

The tides have turned more recently though. Atherton has benefited from the tailwinds of value investing returning to favour with investors since becoming lead manager. Over this period, the fund is comfortably ahead of the broader Japanese stock market, driven largely by the rotation in investment styles and improved performance from companies and sectors more sensitive to the health of the economy, including financials. Past performance is not a guide to the future.

Atherton is a value investor, a style used throughout his career and on this fund since launch. This contrarian investment philosophy is also deeply embedded across the team. The belief is that the best returns can be made investing in companies that are unloved, undervalued and overlooked. Their discipline in this approach sets them apart from their peers.

The team starts by looking for the shares of companies that have been through a tough time. They like those that can be bought at a low price, which doesn't reflect the future growth potential of the business.

They'll look to hold onto the shares over the long term as it can take time for potential to be recognised and then patiently wait for them to recover. The team will slowly sell as the share price rises, or look to invest a little more if the share prices falls. If they feel a company has recovered or if better opportunities emerge, they'll sell and move onto the next investment.

Atherton and his team mainly invest in some of Japan's largest companies, but will also invest in medium-sized businesses if good opportunities emerge. They invest in a relatively small number of companies, meaning each one can have a big impact on the fund's performance. This is a higher-risk approach.

Please note the fund's charges can be taken from capital. This increases the yield, but reduces the potential for capital growth.