Nomura Asset Management U.K. Ltd Nomura Funds August 2005 JAPAN EQUITY Investment Objective To achieve long term capital growth Fund Price Changes through investment in an actively managed portfolio of Japanese The fund outperformed the benchmark by 6 basis points from the NAV pricing point on the 27th July 2005 securities listed/dealt on Regulated to the NAV on the 31 August 2005. Since inception the fund has outperformed the benchmark by 78 basis Markets in Japan and to outperform points, delivering a performance of 9.12% verses 8.34% of the benchmark. the Benchmark [Being the Morgan Stanley Capital International Japan Total Return (Net of Tax) Index]. Performance of Net Asset Value for the Month (Yen basis) Launch date: April 2005 th rd th th th Period 27 July 3 Aug 10 Aug 17 Aug 24 Aug 31 Aug Base Currency: Japanese Yen Fund (NAVps)* 102,335 103,970 105,080 107,565 109,584 109,123 ISIN Code: LU0217998821 Index (MSCI Japan)** 101,659 102,916 104,224 106,234 108,576 108,340 *Net Asset Value per share (NAVps) is calculated by Nomura Bank (Luxembourg) S.A. according to the prospectus and market standards in Bloomberg Code: Luxembourg. **MSCI Japan is the Morgan Stanley Capital International Japan Total Return (Net of Tax) Index Source: Nomura Asset Management NOMJAEQ LX Equity DES <GO> U.K. Ltd Total Net Assets: Nomura Japan Fund vs MSCI Japan (Net Return) JPY 4,034,857,279.00 110 108 NAV Per Share: JPY 109,123.00 106 104 Fund Contact 102 12-Apr-05, Inception 100 Dt Benchmark 98 Yuhki King 96 +44 (0)20 7521 2635 94 5 5 5 5 [email protected] 5 5 5 5 0 0 0 0 5 5 5 5 5 5 5 -0 -0 -0 -0 - - 05 05 -0 -0 05 0 0 0 05 05 -0 05 05 r r r r y- y- n- n- n n n- l- l-0 l- l- g- g- g- g- p p p ay a a ay u u u u u Ap M M J J J Ju Ju Ju Ju u u ug u u -A -A -A -M -M - - -J -J - - - - - -A -A -A -A -A 0- 1- 8- 1 8 9 6 0 7 7 06 13 2 27 04 1 1 25 0 0 15 22 2 0 13 2 2 03 10 1 24 31 Trevor Langford Source: Nomura Asset Management U.K. Ltd +44 (0)20 7521 2653 [email protected] Performance Review for the Month Web site address Despite the Fund’s NAV outperforming during the period from 27th July to 31 August 2005, the Fund’s http://www.nomura.com/nam-europe/funds equity holdings underperformed the MSCI Japan Index by 22 basis points (bp) during the month of August. This newsletter was prepared by Sector allocation was almost neutral, but stock selection results accounted for most of the Nomura Asset Management U.K. underperformance. The stock with the largest weight in the benchmark index, Toyota Motors, outperformed Ltd. The contents of this report are other automobile companies including our favoured stock Nissan Motors. The portfolio has no exposure to not intended in any way to indicate Toyota. Also within the Electronics sector, the consumer electronics companies were notable for their or guarantee future investment disappointing first quarter earnings announcements. Stocks such as Funai Electric and JVC plunged and this results as the value of investments had negative impact on the relative performance. may go down as well as up. Values may also be affected by exchange rate movements and investors may not get back the full amount originally invested. Before Market Outlook purchasing any investment fund or product, you should read the We have upgraded our GDP forecasts for the Japanese economy to 2% and 1.7% for the fiscal years 2005 related prospectus and and 2006 from the 1.7% and the 1.6% figures respectively. The substantial boost owes much to indications documentation in order to form your that the Japanese domestic economy is on a reasonably solid footing. Corporate fundamentals continue to own assessment and judgement improve. Leading sectors, such as Basic Materials, Machinery, and Automobiles are likely to remain dominant and, to make an investment for the time being. decision. The prospectus is available from the Nomura Asset Management U.K. Ltd website. Nomura Asset Management U.K. Ltd. is authorised and regulated by the Financial Services Authority. Nomura Funds August 2005 Sector Allocation Top 5 Holdings (as at August 2005) MSCI Portfolio % of NAM 10 Cluster % Aug .05 Aug .05 Company Name Equity Portion Consumption 8.67 7.30 1 MITSUBISHI TOKYO FG 4.61 Medical 5.80 3.60 2 SUMITOMO MITSUI FG 4.44 Infrastructures 12.77 6.54 3 NISSAN MOTOR 4.28 Machinery 5.31 8.80 4 HONDA MOTOR 4.00 Automobiles 10.94 12.79 Electronics 18.27 22.05 5ROHM 3.57 Commodities 12.86 16.11 Financials 17.78 16.90 Communication 3.02 2.86 Inform/System 4.59 3.05 Source: Nomura Asset Management Co. Ltd Top 3 Positive Contributors Top 3 Negative Contributors Company Name Company Name 1 SUMITOMO MITSUI FG 1 MIZUHO FINANCIAL GR 2 MITSUBISHI TOKYO FG 2 ROHM 3 FAST RETAILING 3 NISSAN MOTOR Source: Nomura Asset Management Co. Ltd Top 10 Active Bettings Top 10 Negative Bettings Company Name % of Betting Company Name % of Betting 1 NISSAN MOTOR 3.16 1 TOYOTA MOTOR -5.54 2 ROHM 3.11 2 TAKEDA PHARMACEUTICAL -2.26 3 SUMITOMO MITSUI FG 2.88 3 MIZUHO FINANCIAL GR -2.20 4 JFE HOLDINGS 2.31 4 CANON -1.79 5 MITSUBISHI TOKYO FG 2.24 5 MATSUSHITA ELECTRIC -1.71 6 HONDA MOTOR 2.01 6 SONY -1.46 7 NIPPON OIL 1.84 7 TOKYO ELECTRIC POWER -1.33 8 DOWA MINING 1.81 8 NTT DOCOMO -1.33 9 TOKYO SEIMITSU 1.81 9 UFJ HOLDINGS -1.14 10 N.T.T. 1.79 10 NOMURA HOLDINGS -1.14 Source: Nomura Asset Management Co. Ltd 2 Nomura Credit Research .