Invesco Asia Dragon Trust lags behind AI boost to Asian markets

Invesco Asia Dragon Trust PLC on Wednesday said it underperformed its benchmark index in the 2026 financial year despite reporting a strong rise in new asset value, as the benchmark was boosted by artificial intelligence-related stocks.

The Asia-focused investor said its net asset value total return in the financial year to the end of April was 39.6%, up sharply from a 2.8% rise in financial 2025.

However, it underperformed the benchmark MSCI AC Asia ex Japan index total return of 45.7%. Invesco Asia Dragon Trust said this was "dominated by the stellar performance of the three largest constituents".

These are Taiwan Semiconductor Manufacturing Co Ltd, Samsung Electronics Co and SK Hynix Inc.

At the end of April, the three stocks accounted for 27% of the whole index and were up 139%, 149% and 274% respectively over the year.

"Performance attribution shows that stock selection in China and an underweight position in the technology sector that developed later in the year were the main causes of the underperformance," said Chair Neil Rogan.

Despite this, Rogan noted that the trust's longer term performance "remains excellent".

Invesco Asia Dragon Trust said its net asset value per share was 479.67 pence at the end of April, up 35% from 356.31p a year ago.

It paid four 3.95p per share interim dividends for the period, bringing the total dividend up 1.3% on-year to 15.80p from 15.60p.

Looking ahead, Chair Rogan said: "The outlook remains positive for strong corporate earnings growth across many markets led by Taiwan and South Korea and with Asia Pacific equities continuing to trade at a meaningful valuation discount to US equities."

Rogan added that from the "relatively stagnant" UK and European standpoint, it is "all too easy to overlook what is happening in Asia".

Shares in Invesco Asia Dragon Trust were down 1.1% at 474.89p on Wednesday morning in London.

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