In spite of the gyrations of global equity markets and the continued climate of risk aversion, investors with subscription shares in JPMorgan Emerging Markets Investment Trust have been keeping faith with the asset class.

Between 1 May and 1 June, more than 460,000 subscription shares in the trust were converted to ordinary shares, raising £2.12m. This accounted for the vast majority of subscription share conversions in the J.P. Morgan Asset Management range of investment trusts during the month, which saw a further £200,000 raised by conversions in the JPMorgan Indian, Asian and Chinese trusts.

Subscription shares, like warrants, are sometimes given to investors at the launch of an investment trust, usually in proportion to the number of shares they buy (such as one subscription share per 10 ordinary shares), or they may be offered at a later date. This was the case with JPMorgan Emerging Markets Investment Trust, which issued its subscription shares as a bonus issue to investors on the register at 11 June 2009, with one subscription shares issued per five ordinary shares held. They give investors the right, but not the obligation, to convert them into ordinary shares in the future, subject to the payment of a conversion price.

The subscription shares have a fixed life, and the conversion price may step up at intervals during this time. Whether the subscription shares represent good value to the investor will depend on the price of ordinary shares in the trust at the point of conversion.

There is also a secondary market in subscription shares. Buying subscription shares is more risky than simply holding them from issue, as the purchase price as well as the conversion price must be taken into account. However, for investors who believe an asset class is undervalued and could power ahead, buying subscription shares in the secondary market can give them geared exposure to the asset.

At 20 June 2012 the price of an ordinary share in the JPMorgan Emerging Markets Investment Trust was 522p, while the conversion price of a subscription share was 460p. Clearly, for those investors who believe in the long-term case for investing in emerging market equities, the chance to buy shares in an established trust at a substantial discount to the market price is proving attractive.

JPMorgan Emerging Markets Investment Trust, managed by Austin Forey and Richard Titherington, was launched in 1991 and has assets under management of £678m (at 31 May 2012), making it both the second-oldest and second-largest trust in its sector. It takes a concentrated approach to investing and holds just 50-75 stocks, drawn from the best ideas of J.P. Morgan Asset Management's network of experts throughout the world's developing markets.

James Saunders Watson, Head of Marketing, Investment Trusts at J.P. Morgan Asset Management, said: "If you have sympathy with the view that emerging markets are likely to be the engine of global growth for some years to come, subscription shares are vehicles that give the chance of getting an enhanced return in the future. Equally, holders who have converted their shares recently have been able to access JPMorgan Emerging Markets Investment Trust at a discount to the current share price.

James Saunders Watson added: "Investors should note that the conversion price of the subscription shares of JPMorgan Emerging Markets Investment Trust is due to step up to 543p on 1 August. This is the final step-up before the subscription shares expire on 31 July 2014."