WS Zennor Japan Equity Income

The Zennor Japan Equity Income fund is an unconstrained, bottom-up fund that specialises in small- and mid-cap dividend growers in the Japanese market. The team combines their rich understanding of this landscape with deep analysis and engagement to find companies that are trading materially below their intrinsic value, are well-capitalised, and provide reliable dividends.

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Our Opinion
Fund Managers
Key Facts
Fund Performance
Risk
Company Description
Investment process
ESG

Our Opinion

It’s hard to be anything but impressed by this small, specialist team at Zennor. Both James and David have accumulated a huge amount of experience managing Japanese equities across the past few decades and have provided investors with excellent returns. We also like how the team is intent on limiting the size of the fund so they can remain flexible and take advantage of more niche ideas without being restricted by market liquidity. The focus on free cash flow, recurring revenues, and prudent capital allocation should provide meaningful downside protection and steady compounding potential for long-term investors.

Fund Managers

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Fund Managers

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James Salter, Co-Fund manager James spent his early career managing Japanese equities, initially at Foreign & Colonial, before stints at Martin Currie and Schroders. He then joined Polar Capital as a founding partner in 2001, where he subsequently worked for 19 years before founding Zennor Asset Management in 2020. James graduated from Reading University with a degree in Classics and studied for a Master’s in Japan Area Studies at the School of Oriental and African Studies. He is a member of the CFA Institute.

David Mitchinson, Co-Fund manager David started his career at Framlington in 1998, managing a Japan fund, before joining JPMorgan and moving to Tokyo in 2004. On leaving JPMorgan in 2013, he spent just over two and a half years with the Abu Dhabi Investment Authority, returning to the UK with TT International in 2016. He helped found Zennor in 2020. He graduated from Cambridge University with a degree in Economics and is a CFA Charterholder.

James Salter, Co-Fund manager James spent his early career managing Japanese equities, initially at Foreign & Colonial, before stints at Martin Currie and Schroders. He then joined Polar Capital as a founding partner in 2001, where he subsequently worked for 19 years before founding Zennor Asset Management in 2020. James graduated from Reading University with a degree in Classics and studied for a Master’s in Japan Area Studies at the School of Oriental and African Studies. He is a member of the CFA Institute.

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David Mitchinson, Co-Fund manager David started his career at Framlington in 1998, managing a Japan fund, before joining JPMorgan and moving to Tokyo in 2004. On leaving JPMorgan in 2013, he spent just over two and a half years with the Abu Dhabi Investment Authority, returning to the UK with TT International in 2016. He helped found Zennor in 2020. He graduated from Cambridge University with a degree in Economics and is a CFA Charterholder.

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Key Facts

Asset type Equity

Annual Income (Historic) -

Sector Japan

Gearing-

Fund Size-

Fund Manager Start Date 24 April 2023

Ongoing Charges Figure (OCF) -

Payment Date(s) June, December

Annual Management Charge (AMC) -

Fund Performance

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Risk

Market risk is managed through the investment process, with the managers avoiding overvalued or speculative companies and maintaining diversified portfolios to perform across market conditions. Operational risk is actively managed through a robust framework overseen by Zennor’s seven-member board, the fund’s Ucits management company, and the operations team, all of whom review internal control reports from outsourced administrators. Regular investment committee, operational, and risk meetings ensure continual oversight. The fund is also monitored against Ucits and mandate rules, stress-tested, and subject to detailed liquidity reporting. Together, these layers of governance and process embed risk control at every level of Zennor’s business.

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Company Description

Zennor Asset Management LLP is a boutique investment firm founded in 2020 by James Salter, David Mitchinson, and Sachin Patel, specialising in Japanese-listed equities. Zennor serves predominantly professional clients, including fund-of-funds, discretionary managers, family offices, charities, private banks, and IFAs, though retail investors can access eligible funds via platforms. The firm is majority employee-owned, with a flat management structure. Zennor’s culture is grounded in teamwork, stewardship, and sustainability, reflecting its long-term commitment to responsible investment and social responsibility.

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Fund Performance

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Risk

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Market risk is managed through the investment process, with the managers avoiding overvalued or speculative companies and maintaining diversified portfolios to perform across market conditions. Operational risk is actively managed through a robust framework overseen by Zennor’s seven-member board, the fund’s Ucits management company, and the operations team, all of whom review internal control reports from outsourced administrators. Regular investment committee, operational, and risk meetings ensure continual oversight. The fund is also monitored against Ucits and mandate rules, stress-tested, and subject to detailed liquidity reporting. Together, these layers of governance and process embed risk control at every level of Zennor’s business.

Company Description

Close

Zennor Asset Management LLP is a boutique investment firm founded in 2020 by James Salter, David Mitchinson, and Sachin Patel, specialising in Japanese-listed equities. Zennor serves predominantly professional clients, including fund-of-funds, discretionary managers, family offices, charities, private banks, and IFAs, though retail investors can access eligible funds via platforms. The firm is majority employee-owned, with a flat management structure. Zennor’s culture is grounded in teamwork, stewardship, and sustainability, reflecting its long-term commitment to responsible investment and social responsibility.

Investment process

The team at Zennor seeks to identify compelling investment opportunities in Japan through three distinct categories of dividend companies: those with capital discipline that can enhance dividends via increased payout ratios or share buybacks; those with earnings growth driving dividend increases; and those offering high, well-protected current yields.

Zennor views Japan’s ongoing corporate governance revolution — marked by new corporate and stewardship codes, and the rise of activist investors — as the catalyst for unlocking long-hidden value. With many smaller companies trading below liquidation value and more than half of the market lacking analyst coverage, Zennor sees substantial inefficiencies across the market-cap spectrum.

Portfolio construction is entirely opportunity-driven rather than benchmark-led. The team focuses on undervalued stocks with identifiable catalysts, combining diverse ideas with unique, company-specific drivers, rather than concentrated macroeconomic bets. Potential investments are initially screened through local due diligence and prioritised based on valuation, management quality, macroeconomic sensitivity, sustainability factors, and structural trends.

The investment approach is deeply valuation-focused, with a preference for stocks offering a significant margin of safety and strong upside potential. Decision making is collaborative between the two portfolio managers, with James Salter holding final authority as lead portfolio manager. The team meets weekly to review existing holdings and new ideas, with the ability to act swiftly when necessary. The output of this rigorous process is a portfolio of between 25 and 40 positions that has a natural overweight to the mid- and small-cap parts of the Japanese market.

Risk

Market risk is managed through the investment process, with the managers avoiding overvalued or speculative companies and maintaining diversified portfolios to perform across market conditions. Operational risk is actively managed through a robust framework overseen by Zennor’s seven-member board, the fund’s Ucits management company, and the operations team, all of whom review internal control reports from outsourced administrators. Regular investment committee, operational, and risk meetings ensure continual oversight. The fund is also monitored against Ucits and mandate rules, stress-tested, and subject to detailed liquidity reporting. Together, these layers of governance and process embed risk control at every level of Zennor’s business.

ESG

Zennor integrates ESG considerations throughout the entire investment process — from idea generation and risk assessment to portfolio construction and stewardship. As long-term investors focused on capital preservation, Zennor believes that understanding ESG risks is essential to fully evaluate a company’s opportunities and challenges. The firm views sustainability as aligned with shareholder value, analysing companies through the lens of how they create and sustain long-term value. Zennor recognises that businesses failing to adapt or demonstrate responsible behaviour face regulatory, reputational, and financial penalties, while those improving their sustainability practices can achieve superior performance.

Zennor places particular emphasis on improving corporate governance in Japan, engaging directly with management teams and other investors to drive better governance, capital allocation, and operational performance. The firm has developed a proprietary sustainability screening system covering over 2,000 companies, producing detailed environmental, social, and governance ratings. This analysis, combined with external data sources, informs Zennor’s quantitative and qualitative investment assessments.

Related Insights

The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund nor of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.