We have been visiting technology companies in Taiwan and want to share some insights about what these businesses are saying and what our views are more generally about the outlook for Asian equities ex-Japan income investing.
Asian equities have outperformed many asset classes this year1 and also over the past two years. This has been driven by earnings, so the market has not become more expensive on a price-to-earnings (PE) basis.
The Asia Pacific ex Japan index trades on a 12.7x PE (1-year forward).2 We think if you are selective about which countries and sectors you have exposure to, Asian equities are well placed versus other regions due to the combination of growth and income available from its world-class technology companies in Taiwan and South Korea, the developed markets of Singapore and Australia (which offer exposure to commodity producers in oil & gas, copper and gold) and the rapidly developing market of India.
Technology has driven this performance, and some are questioning whether the sector may have already peaked or if we are close to a tech “bubble’’ bursting. We expect volatility to remain high and market corrections are certainly possible, even normal. But we are long term investors, not traders, and we expect strong performance to continue for the technology companies we own in our Asian income strategy for several years to come for three key reasons:
1) Demand v Supply:
a. The technology companies that are telling us that demand for their products is not just growing, it is greater than supply. This means that TSMC, Samsung Electronics and SK Hynix are not just growing volumes but are raising prices. The companies say that 2026 is not the peak, and therefore we see this continuing for 2027 and probably into 2028 and beyond. TSMC are already planning what they will be delivering with their customers in 5 years’ time. Samsung Electronics and SK Hynix’s say customers are so keen to guarantee supply of memory they want to sign long-term agreements that cover 3-5 years.
b. The focus today is on LLMs (large language models), but we think that will shift to agentic AI (autonomous AI systems that can achieve complex goals with limited human supervision) and physical AI (i.e. humanoid robots, autonomous driving) – this could drive demand for many years to come.
2) Valuations:
When we look at the PE multiples of the tech companies that we own, we do not see “bubble” type valuations, especially when all these companies have strong balance sheets and are increasing their dividends.
3) Asia Tech more attractive than US Tech:
We think the tech companies we own are more attractive than US tech stocks because:
a. The US hyperscaler companies (including Alphabet, Amazon, Meta, Microsoft) are increasing their capital expenditure, which means their financials are deteriorating (at least in the short term) and that cash is flowing directly to their supply base, including the companies we own.
b. We do not know who will develop the best LLMs, agentic AI or physical AI products or services. It could be Open AI, Anthropic, SpaceX, Google, Microsoft or perhaps some companies we do not even know of today. But for our companies it does not matter. Whoever delivers them, and whatever they are, they will need the semiconductors from TSMC (Taiwan Semiconductor Manufacturing Co), memory from Samsung and Hynix, chip designs from MediaTek and AI servers from Hon Hai and Quanta.
c. Valuations: Per the above, the tech companies our strategy owns generally trade at lower PE valuations and with higher dividends, than US tech stocks.
Jupiter Asian Income Strategy: Where are we invested today?
- c.45% in the technology sector, which means we think we are well-placed for the structural tailwind that we see behind the sector.
- c.17% in commodities producing or mining companies (e.g. oil & gas, copper, gold) and defence.
- Most of the remainder of the strategy is exposed to domestic consumer companies in Australia, Singapore, and India.
- With this diversification we think the strategy is well-placed for a wide variety of different market, economic and (geo)political environments. We also take into account the natural environment, noting the upcoming El Niño and its potential impact.
Here we summarise our views on five of the region’s large tech companies and their involvement in humanoid robots, which we see as an exciting potential long-term growth driver for physical AI products. These companies are shown for illustrative purposes only and should not be viewed as a recommendation to buy or sell.
1. TSMC
- Role: Primary foundry and logic-chip manufacturer.
- Benefit: As the leading producer of advanced processors (like 3nm and 2nm nodes), we would expect that TSMC will manufacture the high-performance "brains" and embodied AI logic units for industry-leading robotics developers. Because humanoid robots require immense computing power to process real-time vision and spatial awareness, we believe TSMC’s advanced nodes and packaging techniques will see long-term volume demand.
2. Samsung Electronics
- Role: Robotics developer, consumer ecosystem leader, and semiconductor powerhouse.
- Benefit: Samsung benefits on two fronts, in our view. First, its semiconductor division will supply logic and memory chips. Second, it is actively developing its own consumer and commercial robots (such as the EX1 exoskeleton and future Galaxy Bots) to integrate with its vast smart home ecosystem. We think Samsung's strategic investments in Rainbow Robotics will potentially allow it potentially to capture a large share of the actual hardware and software market.
3. SK Hynix
- Role: Global memory semiconductor manufacturer.
- Benefit: Robots will act like edge servers, requiring massive amounts of local memory to run generative AI and real-time movement algorithms without latency. In our view, SK Hynix will capture demand by supplying advanced DRAM and High Bandwidth Memory (HBM) to process the high volumes of data needed for complex, "embodied AI" applications.
4. MediaTek
- Role: Fabless semiconductor designer (SoCs).
- Benefit: The company is expanding its Genio platform, targeting highly integrated, power-efficient, edge-AI Systems-on-Chips (SoCs) for IoT (Internet of Things) and industrial robotics. We would expect that MediaTek will seek to capitalize on the need for mid-range and high-end processing solutions that prioritize power efficiency, allowing robots to operate for long periods while performing real-time obstacle avoidance and visual processing.
5. Hon Hai Technology Group (Foxconn)
- Role: Electronics contract manufacturer and robotics pioneer.
- Benefit: Hon Hai is aiming for a three-pronged strategy that spans manufacturing, assembly, and internal deployment. As the world’s largest contract manufacturer, we would expect it will seek to benefit from mass-producing robotic parts for major global tech brands. Additionally, Hon Hai plans to deploy large numbers of humanoid robots into its own factories to automate manufacturing lines and combat global labour shortages.
Footnotes
1Bloomberg as at 16 June 2026, MSCI Asia Pacific ex Japan index. Past performance does not predict future returns.
2Bloomberg, as at 14 June 2026
Strategy risks
- Currency (FX) Risk - The strategy can be exposed to different currencies and movements in foreign exchange rates can cause the value of investments to fall as well as rise.
- Pricing risk - Price movements in financial assets mean the value of assets can fall as well as rise, with this risk typically amplified in more volatile market conditions.
- Market Concentration Risk (Geographical Region/Country) - Investing in a particular country or geographic region can cause the value of this investment to rise or fall more relative to investments whose focus is spread more globally in nature.
- Market Concentration Risk (Single Name) - The strategy holds a relatively small number of stocks and may therefore be more exposed to underperformance of a particular company or group of companies compared to a portfolio that invests in a greater number of stocks.
- Derivative risk - The Strategy may use derivatives to reduce costs and/or the overall risk of the Strategy (this is also known as Efficient Portfolio Management or "EPM"). Derivatives involve a level of risk; however, for EPM they should not increase the overall riskiness of the Strategy.
- Emerging Markets Risk - Emerging markets are potentially associated with higher levels of political risk and lower levels of legal protection relative to developed markets. These attributes may negatively impact asset prices.
- Liquidity Risk (general) - During difficult market conditions there may not be enough investors to buy and sell certain investments. This may have an impact on the value of the strategy.
- Charges from capital - Some or all of the strategy's charges are taken from capital. Should there not be sufficient capital growth in the Fund this may cause capital erosion.
- Stock Connect Risk - Stock Connect is governed by regulations which are subject to change. Trading limitations and restrictions on foreign ownership may constrain the strategy's ability to pursue its investment strategy.
- Default Risk - The risk of losses due to the default of a counterparty on a derivatives contract or a custodian that is safeguarding the strategy's assets.
- Default Risk - The strategy may invest a significant portion of its assets in distressed securities which have a higher risk of losses due to the increased likelihood of an issuer of securities defaulting on its obligations. While they may retain some potential value in the event of default, the recovery process may be lengthy and there may be no secondary market to exit, causing a deterioration in liquidity.
Important information
Marketing Communication.
This document is intended for investment professionals and is not for the use or benefit of other persons, including retail investors. It is information only and is not investment advice. Holding examples are for illustrative purposes only and are not a recommendation to buy or sell. The views expressed are those of the authors at the time of preparation, are not necessarily those of Jupiter as a whole and may be subject to change. Past performance does not predict future returns. The value of investments and income may go down as well as up and investors may not get back amounts originally invested. Exchange rate changes may cause the value of investments to fall as well as rise. Every effort is made to ensure the accuracy of any information provided but no assurances or warranties are given. This document may include ESG-related content which reflects Jupiter’s current policies and frameworks and may evolve over time. No part of this document may be reproduced in any manner without the prior permission of Jupiter.
Argentina
This document and the information contained herein does not constitute and is not intended to constitute an offer of securities and accordingly should not be construed as such. The fund and any other products or services referenced in this document may not be licensed, authorized to distribution in all jurisdictions, and unless otherwise indicated, no regulator or government authority has reviewed this document or the merits of the products and services referenced herein. This document and the information contained herein has been made available at your exclusive own initiative in accordance with the restrictions and/or limitations implemented by any applicable laws and regulations. This document is provided on a confidential basis for informational purposes only and may not be reproduced in any form. Before acting on any information in this document, prospective investors should inform themselves of and observe all applicable laws, rules and regulations of any relevant jurisdictions and obtain independent advice if required. This document has been sent at the specific request of and is for the use of the named addressee only and should not be given, forwarded or shown to any other person (other than employees, agents or consultants in connection with the addressee’s consideration thereof). The fund is not under the public offer regime.
Brazil
The shares in the fund may not be offered or sold to the public in Brazil. Accordingly, the shares in the fund have not been nor will be registered with the Brazilian Securities Commission - CVM nor have they been submitted to the foregoing agency for approval. Documents relating to the shares in the fund, as well as the information contained therein, may not be supplied to the public in Brazil, as the offering of shares in the fund is not a public offering of securities in Brazil, nor used in connection with any offer for subscription or sale of securities to the public in Brazil.
Chile
Neither the issuer nor the shares have been registered with the comisión para el mercado financiero pursuant to law no. 18.045, the ley de mercado de valores and regulations thereunder. This document does not constitute an offer of, or an invitation to subscribe for or purchase, the shares in the republic of chile, other than to the specific person who individually requested this information on his own initiative. This may therefore be treated as a “private offering” within the meaning of article 4 of the ley de mercado de valores (an offer that is not addressed to the public at large or to a certain sector or specific group of the public.
Colombia
This document does not constitute a public offer in the Republic of Colombia. The offer of the fund is addressed to less than one hundred specifically identified investors. The fund may not be promoted or marketed in Colombia or to Colombian residents, unless such promotion and marketing is made in compliance with Decree 2555 of 2010 and other applicable rules and regulations related to the promotion of foreign funds in Colombia.
The distribution of this document and the offering of Shares may be restricted in certain jurisdictions. The information contained in this document is for general guidance only, and it is the responsibility of any person or persons in possession of this document and wishing to make application for Shares to inform themselves of, and to observe, all applicable laws and regulations of any relevant jurisdiction. Prospective applicants for Shares should inform themselves of any applicable legal requirements, exchange control regulations and applicable taxes in the countries of their respective citizenship, residence or domicile.
Costa Rica
This is an individual and private offer which is made in Costa Rica upon reliance on an exemption from registration before the General Superintendency of Securities (“SUGEVAL”), pursuant to article 6 of the Regulations on the Public Offering of Securities (“Reglamento sobre Oferta Pública de Valores”). This information is confidential, and is not to be reproduced or distributed to third parties as this is NOT a public offering of securities in Costa Rica.
As this is NOT a public offering of securities under the definition set forth in the Securities Market Statute (“Ley Reguladora del Mercado de Valores”), the product being
offered is not intended for the Costa Rican public or market and neither is registered or will be registered before the SUGEVAL and, accordingly, it is not covered by the supervision, disciplinary regime and protections afforded to local investors by the Securities Market Statute with regards to the public offerings of securities, and it is not
registered in the National Registry of Securities and Intermediaries (“Registro Nacional de Valores e Intermediarios”).
As this is a private offering of securities, the investor will not have access to ongoing reporting required by the regulations set forth by the National Council for Supervision of the Financial System (“CONASSIF”) and the SUGEVAL.
As this is NOT a public offering of securities registered in the National Registry of Securities and Intermediaries, the investor will not be able to trade the product in the secondary market.
Mexico
The securities have not been and will not be registered with the National Registry of Securities, maintained by the Mexican National Banking and Securities Commission and, as a result, may not be offered or sold publicly in Mexico. The fund and any underwriter or purchaser may offer and sell the securities in Mexico on a private placement basis to Institutional and Accredited Investors pursuant to Article 8 of the Mexican Securities Market Law.
Paraguay
The Fund has not been registered with the Comisión Nacional de Valores of Paraguay (CNV), neither with the Stock Exchange of Asuncion (BVPASA) and is being placed by means of a private offer. CNV nor BVPASA has not reviewed the information provided to the investor. This document is only for the exclusive use of specific investors in Paraguay and is not for public distribution.
Peru
IMPORTANT NOTICE: The Superintendencia del Mercado de Valores (SMV) does not exercise any supervision over this Fund and therefore the management of it. The information the Fund provides to its investors and the other services it provides to them are the sole responsibility of the Administrator. This document is only for the exclusive use of institutional investors in Peru and is not for public distribution.
Uruguay
The sale of the shares qualifies as a private placement pursuant to section 2 of Uruguayan law 18,627. The shares must not be offered or sold to the public in Uruguay, except in circumstances which do not constitute a public offering or distribution under Uruguayan laws and regulations. The shares are not and will not be registered with the Financial Services Superintendency of the Central Bank of Uruguay. The shares correspond to investment funds that are not investment funds regulated by Uruguayan law 16,774 dated September 27, 1996, as amended.