Japan Exposure

[BossMan.]

Hi all,

Keen to hear what peoples thoughts are on Japan and if anyone has gotten exposure to it?

My thoughts as to why Japan is a place of potential growth:

1. A depreciated currency without sacrificing quality of life (good if you want to immigrate..)
2. An increase in Japan's foreign workers program (a clear acknowledgement of there aging population)
3. A renewed focus on the investment of semiconductors
4. Recent Stock Market reforms (missed the boat on this I know...)

There is surely more growth to come out of Japan, and is an area I am looking to gain exposure to.

The only two ETF's have I been able to find are:

Japan ETF - Currency Hedged (BetaShares - HJPN)
iShares MSCI Japan ETF (IJP)

Definitely keen to hear if anyone is aware of any other potential options to get this exposure or there thoughts on Japan as a whole. Maybe I have missed this boat but I still see potential growth.

 

[Garpal Gumnut]

Thanks @BossMan. I was considering a Japan ETF but did not know where to start.

Interestingly I watched a vid today which suggested that countries like Japan will gain more from AI than other countries due to their demographic "problem", low birth rate, high education level, and xenophobic anti immigration policies. Less will be lost to unemployment and a corresponding gain will be made without effort for more productive jobs.

I'll look in to those ETF's and will do some burrowing myself and post. Thanks once again.

gg

 

[Dona Ferentes]

In the managed fund space, there's a Platinum Japan Fund.

 

[divs4ever]

Hi all,

Keen to hear what peoples thoughts are on Japan and if anyone has gotten exposure to it?

My thoughts as to why Japan is a place of potential growth:

1. A depreciated currency without sacrificing quality of life (good if you want to immigrate..)
2. An increase in Japan's foreign workers program (a clear acknowledgement of there aging population)
3. A renewed focus on the investment of semiconductors
4. Recent Stock Market reforms (missed the boat on this I know...)

There is surely more growth to come out of Japan, and is an area I am looking to gain exposure to.

The only two ETF's have I been able to find are:

Japan ETF - Currency Hedged (BetaShares - HJPN)
iShares MSCI Japan ETF (IJP)

Definitely keen to hear if anyone is aware of any other potential options to get this exposure or there thoughts on Japan as a whole. Maybe I have missed this boat but I still see potential growth.

View attachment 176266

i do not invest in Japan by choice , i regard them as captured by the same lunatic policies as the US , UK and EU

however in my pursuit of increased exposure to India ( and other less mature Asian economies ) i hold some LICs like PAI ( which may include Japan exposure long or short as opportunities appear ) and ETFs like ASIA which may at times have some exposure to Japan but not a big one

i also note Japan is veering away from it's non-aggression pact stance that it signed after WW2 i see that as another ruinous policy for aging , shrinking population

but then you are much younger than me , and Japan may turn around their current situation in your life-time ( rather than mine )

good luck

about the only current Japanese policy i see as wise , is their reduction in their US Treasury holdings ( which is more necessity than choice )

 

[qldfrog]

In a short term, the yen might rise and propel the Nikkei but long term, not sure

 

[BossMan.]

In a short term, the yen might rise and propel the Nikkei but long term, not sure

I'm hoping for a cheaper YEN for longer, and I think the Bank of Japan is inline with that (within reason hence the recent ineffective intervention, which is also good for the stock market and most importantly Japanese exports. Specifically Cars).

I agree to an extent that it isn't a long term investment given tension across Asia, but I do see there being positive growth over the next 2 - 3 year time horizon. The low value yen is good for exports, and good for immigration (if the government continues to pivot to a more positive outlook on foreign immigrants).

Ill also be interested to read the U.S. Auto Sales report next month to see if demand is returning as it has began to weaken after record demand in 2022 off the back of supply chain issues (this wont make or break my decision but will definitely be interesting). This, the summary of opinions from the BoJ on May 9th and a few other macro reports will likely make up my decision.

For me any investment will primarily be based off of whether the BoJ remarks indicate a cheaper YEN for longer = buy, if BoJ indicates a stronger YEN I think ill likely avoid it (really interested to see confirmation on if the BoJ did in fact intervene at USDJPY 160)

 

[ducati916]

The weak Yen allows them to challenge China on exports. I don't think China are unduly concerned on this.

The weak Yen has larger implications vis-a-vis the USD and purchasing energy (priced) in USD. Japan currently sit on +/- $1.2T of UST that they can sell down to prop up the Yen or buy USD (which weakens Yen, strengthens USD) for energy.

Definitely intervened last week, but I think via a Fed Swap line. UST market was not roiled.

jog on
duc

 

[BossMan.]

Appears all the global markets are running hot, BlackRock's strategist thoughts on Japan: article

 

[Garpal Gumnut]

I prefer India atm. for overseas "Asian" exposure over Japan.

Japan seems to have had a good run this year, thanks for reminding me of the 16% gain this year, but, the lack of volatility, reality of population contraction, xenophobia, low interest rates and general stasis will prevent me from looking at a managed Japan fund.

Should Trump get elected tariffs gainst freeloading "Western" allies in Asia will increase on Japan's exports

I'm happy to have my mind changed.

What an interesting thread.

gg

 

[Value Collector]

Hi all,

Keen to hear what peoples thoughts are on Japan and if anyone has gotten exposure to it?

Yeah, I like Japan. The only exposure I have to it though is through

1. VGS, which is a global index fund that has some Japanese stocks in it.
2. Berkshire Hathaway - Which is an American company but it holds some Japanese investments.
3. Companies that operate there but are not from there like Apple, Coca-cola, American Express etc etc
4. Companies that export products and commodities there such as BHP, Energy companies, food companies etc etc

 

[BossMan.]

I prefer India atm. for overseas "Asian" exposure over Japan.

This presidential election is all about showing who can be harder on China.

Another interesting article on the Chinese tariffs and there affects on the market. Some interesting exerpts.

Good for Japanese Automobiles?

Semiconductor Benefit?
USA only imports ~$3b worth of semiconductors from China each year anyways (see below) but no doubt this is still positive:

It also appears Europe is moving in suit with the USA? It seems like global markets are moving to more protectionist policies...

On India?
Another interesting article regarding India, and some interesting excerpts:

EDIT:

I am additionally hoping we see the Japanese Central Bank move to a more standard banking system, negative interest rates failed, it failed in the EU and it has failed in Japan. There is also no way the YEN strengthens while there is such a large disparity in rates.

Anyways... I haven't opened any positions yet. But HJPN or IJP is the broad exposure I will likely take. Won't speculate much further then that in Japan.

 

[divs4ever]

I prefer India atm. for overseas "Asian" exposure over Japan.

Japan seems to have had a good run this year, thanks for reminding me of the 16% gain this year, but, the lack of volatility, reality of population contraction, xenophobia, low interest rates and general stasis will prevent me from looking at a managed Japan fund.

Should Trump get elected tariffs gainst freeloading "Western" allies in Asia will increase on Japan's exports

I'm happy to have my mind changed.

What an interesting thread.

gg

India to me looks better also , but i do not ignore Indonesia and Vietnam

however i have recently read some stuff that reminded me South Korea still has potential left , and can be accessed via an ETF ( maybe more ) to boot


now sure Japan has major issues , and is trying to turn things around , but are the entries into Japanese exposure good value for the risks being taken .

to go forward Japan must revitalize it's nuclear power program ( and unless try buy off Russia that can be a big problem and a sanctions problem if they do )

i will be looking for a BIG discount before i start deliberately increasing my Japanese exposure ( but will still consider Japan over the UK and EU )

 

[divs4ever]

This presidential election is all about showing who can be harder on China.

Another interesting article on the Chinese tariffs and there affects on the market. Some interesting exerpts.

Good for Japanese Automobiles?
View attachment 177207
Semiconductor Benefit?
USA only imports ~$3b worth of semiconductors from China each year anyways (see below) but no doubt this is still positive:
View attachment 177208
View attachment 177209

It also appears Europe is moving in suit with the USA? It seems like global markets are moving to more protectionist policies...

View attachment 177210

On India?
Another interesting article regarding India, and some interesting excerpts:

View attachment 177211


EDIT:

I am additionally hoping we see the Japanese Central Bank move to a more standard banking system, negative interest rates failed, it failed in the EU and it has failed in Japan. There is also no way the YEN strengthens while there is such a large disparity in rates.

Anyways... I haven't opened any positions yet. But HJPN or IJP is the broad exposure I will likely take. Won't speculate much further then that in Japan.

first off duties/tariffs hit the US consumers hardest , it encourages slackness in local production and alternate imports , China will simply sell elsewhere and since it will do direct goods swaps Russia and Brazil combined have one and a half times the population of the US

and will supply more useful goods than a sanctioning US will do

China will move to divest it's US and EU assets ( if it hasn't started already .. the gold-bugs are convinced China is already doing that in a consistent way )

so where does that leave Japan ... it will have to drastically improve relations with the Philippines ( some unpleasant memories there , maybe worse than South Korea's )

hint even the Australian aborigines have unpleasant stories about the Japanese .. well before WW2 they irritated a LOT of people around the Pacific rim

 

[DaveTrade]

@BossMan. I currently have a long term position in India (INDA) and I think that it has more to go. Looking at a long term chart of Japan (chart is adjusted for the 2016 split) I think it could be in the early stages of another move up, but it's correcting at the moment. If you decide that you like this one then I advise that you wait until it finishes it's correction and starts to turn back up. It would need to make a higher low to hold the trend. The chart always tells the true story.

 

[systematic]

Japan for a long time now has been known as a value investors market. I have heard that unlocking that value has been a challenge.

I read that Buffett went with the conglomerates due to his need for size. There's heaps of smaller caps (still large) that seem to be cheap.

My preference would be individual stocks if I was going to go there, and buy a bucket of them.
I'll put a paper trade on for Mazda, which would be my pick in a pretend Japanese comp.

 

[DaveTrade]

Japan for a long time now has been known as a value investors market. I have heard that unlocking that value has been a challenge.

I read that Buffett went with the conglomerates due to his need for size. There's heaps of smaller caps (still large) that seem to be cheap.

My preference would be individual stocks if I was going to go there, and buy a bucket of them.
I'll put a paper trade on for Mazda, which would be my pick in a pretend Japanese comp.

Buying a bucket of individual stocks may result in a larger profit if you pick the right mix but you have to be willing to do more work to achieve it. If you are someone with a focus on that country then it makes a lot sense but if your main focus is elsewhere then an ETF can do the job with less involvement.

 

[BossMan.]

All though this thread is about Japan, I figured developments on Asia would also be interesting to discuss.

Wonder what will happen with this Indian election - I also would not be surprised if elections in India are w/o corruption.

Will be watching this space over the coming days.

Article for those with Bloomberg: "India's Markets Brace for Selloff as Modi's Poll Goals in Doubt"

 

[divs4ever]

All though this thread is about Japan, I figured developments on Asia would also be interesting to discuss.

Wonder what will happen with this Indian election - I also would not be surprised if elections in India are w/o corruption.

View attachment 177637

View attachment 177638

Will be watching this space over the coming days.

Article for those with Bloomberg: "India's Markets Brace for Selloff as Modi's Poll Goals in Doubt"

there will undoubtedly be some corruption/interference in the Indian election , there is too much riding on the outcome for any other outcome , however will it change the result ?

Modi is not guaranteed to win , but who are his rivals , and have they any realistic chance ( without the assassination of Modi , remember Imran Khan in the adjoining nation )

IF elected will Modi achieve all ( or most ) of his goals , so many international peers have a much worse record , you can only hope he is mostly successful , but failure is the usual global outcome ( even for relatively easily achieved goals , elsewhere )

pivotal to success will revolve around continued co-operation with China as both move forward ( in their own national interests )

 

[Garpal Gumnut]

there will undoubtedly be some corruption/interference in the Indian election , there is too much riding on the outcome for any other outcome , however will it change the result ?

Modi is not guaranteed to win , but who are his rivals , and have they any realistic chance ( without the assassination of Modi , remember Imran Khan in the adjoining nation )

IF elected will Modi achieve all ( or most ) of his goals , so many international peers have a much worse record , you can only hope he is mostly successful , but failure is the usual global outcome ( even for relatively easily achieved goals , elsewhere )

pivotal to success will revolve around continued co-operation with China as both move forward ( in their own national interests )

All though this thread is about Japan, I figured developments on Asia would also be interesting to discuss.

Wonder what will happen with this Indian election - I also would not be surprised if elections in India are w/o corruption.

View attachment 177637

View attachment 177638

Will be watching this space over the coming days.

Article for those with Bloomberg: "India's Markets Brace for Selloff as Modi's Poll Goals in Doubt"

How about you two start a thread on India as it would be fascinating.

If I want to discuss India on ASF I don't expect to go to a Japan thread to do so. Although, as the knee bone is attached to the thigh bone (but not to the shoulder bone ) it is sometimes moot.

gg

 

[Garpal Gumnut]

Thanks all for starting and keeping this Japan Exposure thread going. It is quite a common topic on USA stock forums so there may be a few dollars to be made in looking at an etf of Nipponic shares.

The currency aspect is one that has stopped me from seriously looking at it. As well as the strangeness of Japanese culture. It is probably the only country I have visited that is full of foreigners, the Japanese. They are quite a xenophobic mob with a significant low birthrate and no immigration which long term does not bode well for industry and services which I believe make up a significant proportion of their economy. The Japanese cousins also have real enemies close by in the form of Korean and Chinese cousins who dislike them intensely and still harbour hurt over their military atrocities back in the 1930's and 40's.

I have looked in to the https://www.blackrock.com/au/individual/products/273434/ishares-msci-japan-etf .This is originally a US denominated etf transferred to Australian domicile in 2018 and now quoted in $AUD.

iShares MSCI Japan ETF (IJP).​

It's fees are reasonable and it has shown a good profit, all in the accompanying graphic, as well as its investment sector profile..

I thought I'd show the currency over the last two years which indicates that the fund may be fighting headwinds with a weaker YEN over the next few years.

gg