...certainly the monetary policy after last weeks surprise announcement. It also seems that it might be a good place to make some money as their pension funds pump more money into equities and the valuations are apparently still quite cheap over there. However, it does seem that this puts the Yen in pole position right now in the race to the bottom by major currencies.
So if you are going to invest there you might want to think about a hedged strategy and one way of doing this for UK investors is the I-Shares MSCI Japan GBP Hedged UCITS ETF, although I note it is not that cheap with an expense ratio of 0.64% and sadly it offers little or no yield in common with many funds investing in Japan.
However, an alternative way to get exposure and a yield, albeit indirectly and if you are of a bullish disposition, is to buy into Polar Capital (POLR). Obviously as this is an asset manager and the shares tend to be volatile you would need to be bullish to buy this one at this stage and if you think we are at the top of the cycle and about to see a bear market then it won't be for you, but you can learn more if you are interested by clicking the link in the name above.
So with that caveat what's the story? Well they are quite big in Japan and did well on the back of it in recent years when Japan and their fund was doing well. They have however been broadening and diversifying their range of funds in recent years to become a more broadly based asset management company rather than a specialist boutique. It trades on a fairly average 14x or so but the main attraction is the 6% or so yield because they pay a dividend which is roughly equivalent to and grows broadly in line with their earnings. This is probably because they have lots of cash on the balance sheet any way, oh yes and three of the directors hold just over 15% of the equity worth around £64 million pounds.
People seem to have latched onto this on Friday as the share spiked up close to being over bought, but they so tend to be volatile any way (see Chart below). So it may be worth waiting for a relapse in the price if you are feeling bullish with levels around 400 pence looking like a good support area recently. if you are not of a bullish disposition and don't want to be Big In Japan then I can offer a cheesy 80's video / Euro pop song - Big In Japan instead for your entertainment at the end of this post (see website if you are reading this on the e-mail), appropriately maybe by a band called Alphaville, doesn't the FT have a section called that these days?