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It’s time to think about Japan’s future, not its past

Nicholas Weindling, manager of the JPMorgan Japanese (JFJ) and Japan Smaller Companies (JPS) investment trusts, urges investors not to dwell on the historical disadvantages of investing in Japan.

An over-valued currency, a stagnant economy mired in deflation and held back by an ageing population, are the usual negative charges levelled against the country.

However, in this video interview, Weindling says investors should look forward not backwards. Japan’s stock market is cheap compared to the rest of the world. Although prime minister Abe has not so far succeeded in restoring some healthy inflation into the economy, Weindling explains his other reforms have made a positive impact. Particularly significant for investors are the labour market, where more women are now employed; tourism, where overseas visitor numbers have trebled; and corporate governance, where companies are more responsive of their duties to shareholders.

Moroever, Japan is stuffed with exciting businesses, particularly in robots and automation in which companies such as Keyence Corporation (6861.T), SMC Corp (6273.T), Fanuc Corp (6954.T) and Harmonic Drive Systems (6324.T) are world leaders. 

Weindling also explains how the advantages of an investment mean that JPMorgan Japanese has delivered better returns than his open-ended JPM Japan fund.

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Nicholas Weindling
Nicholas Weindling
11/85 in Equity - Japan (Performance over 3 years) Average Total Return: 78.22%