The Bank of Japan will set two interest rates: a short-term policy rate and an operating target for long-term interest rates. These rates will serve as guidelines for market operations.
As Kuroda pointed out, the primary reason inflation hasn’t risen in Japan is what he calls the deflationary mindset—the view that prices will not rise.
Kuroda noted that although rates couldn’t be arbitrarily pushed into any level of negative territory, the level in Japan “is still far from such lower bound.”
The Calamos International Growth Fund – Class A (CIGRX) has been a below average performer in 2016 year-to-date among the 12 funds chosen for this review.
Flows into investment-grade bond funds were positive last week. Investment-grade bond funds saw net inflows of $907.1 million during the week ending July 6.
As the yen continued to appreciate, Japanese equities witnessed a massive sell-off on Tuesday, April 5, 2016. Banks and export-oriented companies have been hurt the most.
The AB International Growth Fund is invested in companies like Roche Holding (RHHBY), Sumitomo Mitsui Financial Group (SMFG), ING Groep (ING), TAL Education Group (XRS), and Tata Motors (TTM).
The US dollar–Japanese yen currency pair has been one of the most volatile developed country currencies in the past six months. The Japanese yen saw heavy appreciation in August.
The US dollar to Japanese yen currency pair, which is inversely related to the Japanese yen, had a remarkable week beginning Monday, February 1, 2016. It fell from close to 121 to a low of 115.
The US dollar-Japanese yen currency pair is inversely related to the Japanese yen. It rose to a high of 121.68 after the BoJ’s (Bank of Japan) monetary policy.
The Matthews Japan Fund – Investor Class (MJFOX)adopts a bottom-up approach to constructing portfolios. This means that it looks at companies with acceptable valuations that are expected to do well in the future, rather than specific industries.
The Fidelity Japan Fund (FJPNX) did not have a good 2015 as its stock picks from the information technology and materials sectors did badly during the year.
In the past year, the Bank of Japan made some changes in its quantitative easing program. It introduced the buying of exchange-traded funds that follow the JPX-Nikkei Index 400.
On December 31, 2015, the banking industry of the iShares MSCI Japan ETF (EWJ) returned -0.4%. The Wisdom Tree Japan Hedged Equity ETF (DXJ) fell by 1%.
The US dollar-Japanese yen currency pair is inversely related to the Japanese yen. It fell by more than 1% on December 18 after the BoJ’s monetary policy.
The banking industry provided the highest negative return on December 15. All of the banking stocks provided negative returns ahead of the BoJ’s meeting.
The Japanese yen was trading with a slightly stronger bias against the US dollar on December 14, 2015. Investments increased in the safe-haven currency.
On December 11, 2015, DXJF closed at $25.57. This was below its 100-day, 50-day, and 20-day moving averages of $27.71, $27.39, and $27.47, respectively.
On Tuesday, December 8, 2015, the stocks at the top of the iShares MSCI Japan ETF (EWJ) were ANA Holdings, Japan Airlines, and Nexon. They rose 2.2%, 1.3%, and 1.4%, respectively.
On December 7, 2015, the BoJ (Bank of Japan) Governor Haruhiko Kuroda dismissed any requirement of negative deposit rates to relieve deflationary pressures.
To understand the reasons behind EWJ’s performance, it’s important for investors to analyze the performances of the various industries on November 30, 2015.
The US-dollar-to-Japanese-yen currency pair, which is inversely related to the Japanese yen, rose nearly 0.3% after the release of the retail sales and industrial production data on November 30, 2015.
To understand what drove EWJ and what pulled it down on November 27, 2015, it’s important for investors to analyze the performance of the various industries in EWJ that day.
Leading Japanese banking companies like Sumitomo Mitsui and Mizuho declared that they would realize investment gains by selling stock holdings on their latest earnings.
The pharmaceutical industry provided the highest weighted return of 0.06% as well as the highest individual return of 20% on November 24, 2015. Of the 17 pharmaceutical stocks in EWJ, 15 had positive returns.
The rise of geopolitical tension in Syria Today, on November 24, with Turkey shooting down a Russian plane near the Syrian border, meant that there was again demand for safe-haven currencies.
Fukuoka Financial Group returned 2.8% on November 19, 2015. Moody’s, the global credit rating agency, upgraded the bank’s outlook to positive in September 2015.
On November 18, 75% of the portfolio holdings of the iShares MSCI Japan ETF (EWJ) closed above their 100-day moving averages—up from 66% on November 17.
The US dollar-Japanese yen currency pair rose nearly 0.8% on November 16. The currency pair reached a high of 123.3 before closing for the day at 123.2.
DXJF is the only ETF to provide exposure to Japanese financial stocks. Trading activity in the DXJF fund has been scarce, with only a few thousand shares trading hands each day.
An analysis of the iShares MSCI Japan ETF will tell us about more about its Volatility, showing the fluctuation in periodic returns from average returns.
The EWJ ETF is an indicator of the Japanese equity market. On October 27 it fell by 0.80% from the previous trading session, ahead of the Bank of Japan’s meeting.
The iShares MSCI Japan ETF (EWJ) fell 0.08% from the previous day to close at $12.50 on October 26 ahead of the Bank of Japan’s monetary policy review on Friday, October 30.
The Hennessy Japan Fund (HJPNX) dived by 8.2% in September from the previous month—the worst performer in September among the nine funds we’re reviewing.
The Hennessy Japan Fund Inv Class seeks “long-term capital appreciation by investing in stocks of Japanese companies” and has 22 holdings as of September.
The Japanese yen was trading relatively flat with a bias towards depreciating against the US dollar on October 21. The trade balance data showed weaker growth in exports.
Persistent failure in getting Japan back on the growth path has impacted Japan-focused mutual funds. It violates the popular belief of getting rewarded after being invested for a long term.
Consumer discretionary stocks and financials formed the core of the SunAmerica Japan Fund’s (SAESX) portfolio, making up 27.9% and 23.1% of total assets, respectively.
As of the end of August 2015, the SunAmerica Japan Fund (SAESX) was managing assets worth $41 million. Its net expense ratio is 1.90%, and it charges a 12b-1 fee of 0.35%.
Japanese equities fell as Chinese stocks corrected in late June and July. They fell even after the People’s Bank of China devalued the yuan three times in the week ended August 14.
Policymakers and investors have been worried about Japan’s debt burden becoming unmanageable. The International Monetary Fund noted that Japan’s debt could near 300% of its GDP mark by 2030.
Japanese retail sales, an indicator of consumption in the economy, rose 0.9% YoY in June. The figure exceeded forecasts but was down compared to the previous two months.
In this series, we’ll look at the International Monetary Fund’s expectations for economic growth around the world, and we’ll explore how these projections might affect your investments.
Investment-grade corporate bonds worth $55.4 billion were issued in the primary market in the week ended July 17, 2015. The number of issuers rose to 20 from 17 in the previous week.
Some investors like to invest in stocks from Europe and Japan. The iShares MSCI EAFE (EFA) has half its assets invested in European stocks and 22% in Japanese stocks.
The Bank of Japan first introduced quantitative easing in March 2001 when it began purchasing Japanese government bonds. This continued until March 2006.
