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Learning, Sharing, and Teaching => Investor Alley => Topic started by: mohawkbrah on May 28, 2016, 12:56:40 AM

Title: is investing in japan worth it?
Post by: mohawkbrah on May 28, 2016, 12:56:40 AM
From the looks of it Japan is a shrinking economy with a negative population growth.
Title: Re: is investing in japan worth it?
Post by: Gonzo on May 28, 2016, 07:56:09 AM
I personally would not overweight Japan.  Japan has an alarming amount of public debt and they've implemented negative rates and QE.  The BoJ has also bought stocks.  Who knows how that will unwind? 

However, broadly diversified international and ex-US funds have a decent proportion of Japanese stocks, and I wouldn't pay more to avoid Japanese stocks.  I market weight Japan by investing in these indexes, not more, not less. 

 

Title: Re: is investing in japan worth it?
Post by: frugledoc on May 28, 2016, 08:07:21 AM
Yes, it is worth holding the all world market weighting of Japan but I wouldn't overweight it
Title: Re: is investing in japan worth it?
Post by: MustacheAndaHalf on May 28, 2016, 10:32:44 AM
Because everybody knows how terrible Japan is, you might be able to find a bright spot if you researched it.  But the Prime Minister of Japan just compared the world environment as similar to 2008, which rings false here in the U.S.  The problem is that Mr Abe already promised his previous measures would save the economy.  It sounds like he's talking up an excuse to meddle with the economy further, which implies his prior measures didn't work.  That's from not researching it, I would expect Japan is not free of it's troubles yet.  But it's possible most people are too pessimistic on Japan, and a savvy value investor could hold on until Japan rebounds.  Just don't expect to invest for 1 or 2 years and turn a big profit - you would need research and a long time frame.
Title: Re: is investing in japan worth it?
Post by: Heckler on May 28, 2016, 02:39:32 PM
I get $C 0.50-0.80 per unit annual distributions on my 20% allocation of EAFE IMI Index (XEF in Canada, EFA in US) that has a fair share (23%) of Japan.  Not much Cap gains though.

https://www.blackrock.com/ca/individual/en/products/251421/ishares-msci-eafe-imi-index-etf