🎁Would You Invest in Japan with Warren Buffett if Times Went Backward?
[Miser][Miser][Miser]Japanese Stocks hit highest prices since 1990, Buffett wins again!
1.Japan stocks hit 34-year high, Japan’s Nikkei 225 Climbs Back to Highest Since 1990 Bubble Era.
The Nikkei rose 25% in 2023, its best performance in 10 years, and topped the list of global stock index gains in 2023.
The main reason is that the Japanese authorities are pushing companies to increase shareholder value. In addition, Japan's decades-long deflation has subsided and asset prices have risen moderately.
Japanese asset tickers that may interest you:
Futures tickers : $SGX Nikkei 225 - main 2403(NKmain)$ $OSE Nikkei 225 - main 2403(JNImain)$
ETFs tickers: $iShares JPX-Nikkei 400 ETF(JPXN)$ $Nikkei 225 Exchange Traded Fund(NTETF)$
2.Who are the winner of Japan's asset surge?—Warren Buffet: $Berkshire Hathaway(BRK.A)$ $Berkshire Hathaway(BRK.B)$
On April 11, 2023, Warren Buffett, founder of Berkshire Hathaway, emphasized in an interview with the Nikkei Business News in Tokyo that he was optimistic about Japanese stocks and would consider increasing investment in Japanese stocks.
According to Buffett, he has increased his holdings in Japan's five largest trading companies to 7.4%, saying that this is Berkshire Hathaway's largest investment outside the United States.
The five major trading companies are: Itochu Corporation, Marubeni Corporation, Mitsubishi Corporation, Mitsui & Co., and Sumitomo Corporation.
3. Looking ahead to 2024:
"We think Japanese equities are likely to remain attractive for now, although returns may not be as strong as in 2023," said Charucha Nana, market strategist at Saxo Capital Markets. He said potential headwinds facing the Japanese stock market this year include expectations for the Bank of Japan to adjust its ultra-loose monetary policy and the potential appreciation of the yen.
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Did you invest in Japan assets？
If times went backward, would you invest in Japan with Warren Buffett？
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perhaps uncle buffett saw something that makes him think of a second revival or perhaps he is trying to revive Japan economy since he has the [USD] [USD] [USD]
as for me, a small fry, don't have the [USD] [USD] [USD] to be a part of this...
maybe if I strike lottery and become as rich as uncle buffett then perhaps I can join the ranks...
yep, dream on... what a beautiful.dream... [Chuckle] [Chuckle] [Chuckle]
It was great to see this finally being rewarded over the last 12 months. The question now sits around rebalancing with the original Japanese allocation now skewed to some extent. Again portfolio management tells me that I should trim this slightly but I have to agree with the theme of the article that this story of increased share holder value feels like there's potentially another chapter or two to come yet.
In mid-2023, Berkshire Hathaway's official website issued a statement stating that it had increased its average shareholding ratio in Japan's five major trading companies to more than 8.5% through its wholly-owned subsidiary National Indemnity Company.
$Berkshire Hathaway(BRK.A)$ reiterated its previous position that it intends to "hold its investment in Japan for the long term," but the shareholding ratio will not exceed 9.9% depending on the price.
Some background of the history of the Japanese stock market:
Low period:
The Japanese stock market has gone through more than three decades of dark years.
In the 1980s, with the rapid economic development and the increase in stock market trading volume, the Nikkei 225 Index rose five times in eight years, hitting a record high of 38,915 points on December 29, 1989.
However, in the early 1990s, , due to the emergence and collapse of the bubble economy, the Nikkei 225 Index continued to fall and experienced a long trough period.
Recovery and catch-up period:
After 2013, under the stimulation of "Abenomics", monetary policy easing and the direct purchase policy of stock market ETFs stimulated economic growth and stock market rise.
The Japanese index exceeded 20,000 points at the end of 2015, but it was affected by the global Trade tensions, the COVID-19 epidemic, and the Federal Reserve's rapid interest rate hike in 2022 were stimulated by multiple factors, triggering capital outflows and a decline in the stock market from Japan.
In the blink of an eye, 32 years have passed since the Nikkei 225 Index hit its historical high of 38,957.
Japan's focus on innovation, especially in technology and robotics, fits well with Buffett's appreciation for forward-thinking industries. Investing in pioneers like Fanuc or SoftBank, known for disruptive tech investments, could yield substantial returns.
Given Buffett's affinity for dividend-paying stocks, established Japanese companies like NTT Docomo or Mitsubishi UFJ Financial Group might be attractive choices, offering stability and income.
The Nikkei 225 $Nikkei 225 Exchange Traded Fund(NTETF)$ , mirroring Japan's stock market, and strategic ETFs would diversify the portfolio, a move in line with Buffett's emphasis on risk management.