We have a high regard for the manager, Andrew Rose, and his very disciplined and sensible approach to investing in this market. However, the fund's objective is to outperform the TOPIX benchmark by 2.5% p.a. over rolling three years and to deliver top quartile returns within the IA Japan peer group. We think the index plus target is a difficult one to achieve on a consistent basis (for any manager) and especially when risk is being taken in such a measured and considered manner. This has typically resulted in a portfolio beta much less than the index which, particularly in the prevailing environment, can lead to the fund struggling to meet its index objective. As such, for these reasons, whilst we have faith that the manager will continue to deliver attractive levels of outperformance compared to the index, the performance objective will remain a hard one to continuously meet; this view is therefore reflected in the fund's rating being changed from AAA to A.