Shin Nippon soars thanks to e-commerce holdings

Holdings in e-commerce businesses helped Baillie Gifford’s Shin Nippon investment trust strongly outperform its benchmark index.

The £129m trust, managed by John MacDougall, saw its share price rise 46.4 per cent in the year to January 31 compared to the 17.3 per cent return by the MSCI Japan Small Cap index, in sterling terms, according to its full-year results.

The manager said the e-commerce market in Japan had expanded rapidly and that “several of the best performing holdings benefited from this positive background”.

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Mr MacDougall said internet advertising company F@N Communications was the “largest positive contributor” to performance in the year while GMO Payment Gateway, a digital payment processing services company, performed strongly as “more websites signed up to use its services”.

He added that several other businesses the trust owned which had developed their websites with the “intention of becoming the de facto online marketplace for their particular industry also performed well”.

Elsewhere, the manager said the economic conditions in Japan were “much healthier than they have been in recent years” adding that the “positive entrepreneurship trends” he had witnessed were coming to fruition.