Last Updated on December 29, 2021 at 6:07 pm
In this article, we review the Edelweiss Greater China Equity Off-shore Fund. This is an open-ended fund of fund scheme investing in JPMorgan Funds – Greater China Fund (the underlying fund).
JPMorgan Funds – Greater China Fund is an equity fund investing primarily in a diversified portfolio of domiciled companies in, or carrying out the main part of their economic activity in, a country of the Greater China region.
It is uncanny how investors look at the last one year return of a fund and assume, “this looks like a good idea for a long-term investment”. We saw this to be the case for PGIM India Global Equity Opportunities Fund(reviewed), and now with a 75% last one year return, this fund has caught the attention of investors. And as usual, the investor-interest will peak after the market peak.
Many investors may have patriotic reasons to not invest in Chinese equity. Many investors may have governance-related or lack of transparency related reasons to not invest in Chinese equity. We shall not discuss these issues here and focus only on the performance of the underlying fund.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! 🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥
Edelweiss MF acquired JP Morgan MF India in late 2016. So from Nov 25th 2016, JPMorgan Greater China Equity Offshore Fund became Edelweiss Greater China Equity Off-shore Fund. The fund has an inception date of 25th Aug 2009.
As per the Feb 2021 factsheet from Edelweiss MF, this is the portfolio of the JPMorgan Funds – Greater China Fund.
- Tencent Holdings Ltd. 9.72%
- Taiwan Semiconductor Manufacturing Co., Ltd. 9.63%
- Alibaba Group Holding Ltd. 8.00%
- Meituan Class B 3.99%
- Ping An Insurance (Group) Company of China, Ltd. Class H 3.33%
- Hong Kong Exchanges & Clearing Ltd. 2.57%
- China Merchants Bank Co., Ltd. Class H 2.29%
- Wuxi Biologics (Cayman) Inc. 2.14%
- Pinduoduo, Inc. Sponsored ADR Class A 2.01%
- Kingsoft Corp. Ltd. 1.95%
- Alibaba Group Holding Ltd. Sponsored ADR 1.75%
- Realtek Semiconductor Corp 1.69%
- Sun Hung Kai Properties Limited 1.60%
- Ping An Bank Co. Ltd. Class A 1.55%
- NetEase, Inc 1.51%
- Yunnan Energy New Material Co., Ltd. Class A 1.44%
- Kingdee International Software Group Co., Ltd. 1.44%
- Country Garden Services Holdings Co. Ltd. 1.40%
- Chailease Holding Co. Ltd. 1.34%
- Sunny Optical Technology (Group) Co., Ltd. 1.31%
- Hang Seng Bank, Limited 1.26%
- Vanguard International Semiconductor Co. 1.25%
- Xinyi Solar Holdings Ltd. 1.23%
- ENN Energy Holdings Limited 1.22%
- ASPEED Technology, Inc. 1.22%
- Parade Technologies, Ltd. 1.17%
- ASE Technology Holding Co., Ltd. 1.10%
- Shenzhen Mindray Bio-Medical Electronics Co., Ltd. Class A 1.01%
- Formosa Petrochemical Corp 1.01%
- Shenzhou International Group Holdings Limited 1.00%
- Others 27.87%
The Edelweiss FOF has an AUM of Rs. 1200 Crores (Feb 2021), and as of Dec 2020, about 60% of it was in the direct plan. The direct plan has a TER of 1.34% which includes 0.77% TER of the underlying fund. The regular plan has an atrocious TER of 2.37%. The distributor pockets the difference in TER between the regular and direct plan from the investors current market value for those who may not know.
The since inception growth of Edelweiss Gr China Equity Off-Shore Fund (regular plan) is compared below with Nifty 50 TRI. Aside from the growth spurt over the last year, the fund’s performance has largely been unremarkable. Simple intuition should tell us that this momentum is unlikely to last and has already started ‘correcting’.
The same is true of the underlying fund when compared with its benchmark: MSCI Golden Dragon. Screenshots from MorningStar UK.
If you look at the JP Morgan fund page, the performance will read as shown below, but the bulk of the outperformance came in the last year. There also seems to be a distinct deviation in the fund’s portfolio and the index portfolio.
| JPM I (acc) – USD | MSCI Golden Dragon (USD) | |
| 3 YEARS | 22.09% | 11.67% |
| 5 YEARS | 27.84% | 19.66% |
| 10 YEARS | 13.54% | 9.20% |
Shown below is the 1524 5-year data points (rolling returns) for each series in INR. Notice that the Edelweiss Greater China Equity Off-shore Fund has only recently outperformed the Nifty 50 TRI or S&P 500 TRI INR.
Aside from patriotic or nature of the governance, even from a mere return point of view (which is all that most investors care about), there is no compelling reason to invest in Edelweiss Greater China Equity Off-shore Fund. We recommend that investor not get swayed by recent returns and avoid this fund.
This “international diversification” is often a messy business for most retail investors, incapable of measuring the impact of such portfolio clutter. At least for the moment, only the US indices seem to satisfy the young investors craving for insatiable returns, excuse me, ‘diversification’. So it is better to prefer Motilal Oswal S&P 500 Index Fund compared to this (relatively speaking).
🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 5000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! ⇐ More than 1,000 investors and advisors use this!
New Tool! => Track your mutual funds and stock investments with this Google Sheet!
We also publish monthly equity mutual funds, debt and hybrid mutual funds, index funds and ETF screeners and momentum, low-volatility stock screeners.
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter using the form below.
- Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!
About The Author
Dr M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter(X), Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu Gets a Superpower!” is now available!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Do you want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & its content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our YouTube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing
Published by CNBC TV18, this book is meant to help you ask the right questions and seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want
This book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.Your Ultimate Guide to Travel
This is an in-depth dive into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, and how travelling slowly is better financially and psychologically, with links to the web pages and hand-holding at every step. Get the pdf for Rs 300 (instant download)