22nd Mar 2016 10:16
LONDON (Alliance News) - Baillie Gifford Japan Trust PLC on Tuesday said that the effect of gearing, a term used for borrowing, had a negative effect on its portfolio in the first six months of its financial year, more than offsetting outperformance of its equity holdings against its benchmark.
The trust's net asset value per share, after deducting borrowings at fair value, increased by 0.1% in the six months ended February 29, compared to a 1.0% increase in the TOPIX total return (in sterling terms) benchmark index. The trust's share price decreased by 1.3%.
"There were strong share price performances from stocks related to the sharing economy which helped performance including Next, an online property broker, and Park 24, which operates car parking and car club services," the trust said.
"The portfolio was also helped by the lack of holdings in the mega-banks, which have been weak since the Bank of Japan cut interest rates," the trust added.
First-half finance costs of borrowings rose to GBP663 million from GBP507 million.
Shares in the trust were up 1.0% at 461.27 pence on Tuesday morning.
By Samuel Agini; [email protected]; @samuelagini
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