The board of the JPMorgan Chinese Investment Trust has proposed a new dividend distribution policy to give the vehicle a stronger focus on income, which would also see it change its name to reflect the move.
Though the board said it remains supportive of the trust's investment strategy and has no wishes to amend this, it has proposed introducing an enhanced dividend to help the trust appeal to investors seeking income.
In a stock exchange announcement this morning (4 December), the board said: "While the board has no desire to change the company's investment approach or how the portfolio managers select stocks for the portfolio, it is aware that a number of investors are seeking investment opportunities that provide a reliable level of income alongside capital growth.
"In the current low interest rate environment, the board believes that investors will continue to be attracted to income generating investments."
The board is looking to set a new target dividend equivalent to 4% of the trust's NAV on the last business day of the preceding financial year.
This dividend will be announced at the start of each financial year to provide clarity to shareholders and will be paid in four equal interim instalments.
The change is being proposed for shareholder approval at the next annual general meeting in February 2020.
The board said it believes this new dividend policy "will significantly enhance the company's appeal to both new and existing investors, improve liquidity and, over time, result in a narrowing of the discount".
If the changes go ahead, the board is proposing the trust should be renamed JPMorgan China Growth & Income to reflect this move.
Currently, the trust is trading on a discount of 12.5%. It has returned 89% in NAV terms over five years to 3 December, according to FE fundinfo, against the Country Specialist: Asia Pacific ex Japan sector average of 60.5%.