#Japan #Tokyo #Asset Management One #unlisted stocks #Pilot Fund

Overview of the New Pilot Fund

On October 9, 2023, Asset Management One Co., Ltd., headquartered in Chiyoda, Tokyo, announced the establishment of a pilot fund designed to facilitate direct investments in unlisted stocks in Japan without the mediation of external funds. This private investment trust aims to invest practically through a mother fund, with the future intention of integrating the target mother fund into public investment trusts.

Objective of the Pilot Fund

The pilot fund aims to accumulate insights into operations, fair value evaluation, and investment management through direct investments in unlisted stocks. By doing so, it strives to provide investors with new options in domestic stock investment and create additional revenue opportunities. This move aligns with Japan’s broader goal of supplying growth capital to startups as outlined in the "Startup Development Five-Year Plan" announced by the government in 2022. As part of this initiative, rules regarding the inclusion of unlisted stocks in public investment trusts were revised in late 2023.

Addressing Challenges for Startups

Startups often face challenges such as the “small listing” issue, where they are forced to list at a low market capitalization, and the “valley of death,” which occurs when stocks are sold shortly after listing, complicating further fundraising. The new investment strategy, that blurs the lines between unlisted and listed stock investments via public trusts, is expected to help resolve these issues, thereby promoting the sustainable growth of unlisted companies.

Commitment to Future Growth

Asset Management One is committed to its mission of fostering the future through investments by continuously generating new investment opportunities that meet diverse client needs. The company aims to support asset formation for clients while contributing to the development of Japan's economy through the growth of unlisted enterprises.

Investment Trust Risks and Costs

Investment Trust Risks

Investors should be aware that, as investments in this trust include various market-dependent securities—such as stocks, bonds, and real estate investment trusts (REITs)—the net asset value may fluctuate. Changes in market conditions or the credit status of involved securities may result in a decrease in the value of the investment, thereby exposing investors to the risk of capital loss; invested capital is not guaranteed.

Costs Associated with the Investment Trust

Investors will incur the following costs related to their investment:

• - Direct Costs:

- Purchase Fee: Up to 3.85% (incl. tax)
- Refund Fee: May vary depending on the redemption value
- Trust Property Retention Fee: Up to 0.5%

• - Indirect Costs:

- Asset Management Fees (Trust Remuneration): Up to 2.288% per annum (incl. tax)

These fees represent the maximum rates that may apply, and in cases of performance-based fees, costs could exceed these limits. The rates for risks and costs are reflective of the most significant applicable fees across all Investment Trusts managed by Asset Management One.

About Asset Management One

Established in October 2016, Asset Management One is a leading asset management firm in Japan, boasting approximately ¥72 trillion in managed assets across both investment advisory and trust businesses. With a corporate message of “Nurturing the Future through Investment,” the firm utilizes seasoned investment strategies supported by a robust global research framework to cater to the diverse needs of retail and institutional investors with top-tier solutions.

For additional information, please visit Asset Management One’s official website.