Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Chasing Olympic Glory: 2 Japanese ETFs That May Win Big In Run-Up To The Games

By Investing.com (Tezcan Gecgil/Investing.com )ETFsJun 08, 2021 04:49AM ET
www.investing.com/analysis/chasing-olympic-glory-2-japanese-etfs-that-may-win-big-in-runup-to-the-games-200584710
Chasing Olympic Glory: 2 Japanese ETFs That May Win Big In Run-Up To The Games
By Investing.com (Tezcan Gecgil/Investing.com )   |  Jun 08, 2021 04:49AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The Tokyo Olympics will begin on July 23. Japan is the host nation for the events, which will be held after a one-year delay due to the pandemic.

When the Olympics' host country is initially announced, that country's stock market typically gets a boost in return. After all, parts of the country get significant infrastructure investment. The results for the actual year of the Games might, however, be more mixed.

For instance, recent research led by Patricia Dechow of the USC Marshall School of Business in Los Angeles, California, has looked at stocks in China and the UK around the time of their hosting of the Olympics.

Her findings point out that the Olympic "euphoria" was "sufficient in both China and the UK to influence stock returns and valuations, but the overall fundamental benefits of the Olympics [were] small."

Meanwhile, JP Morgan suggests Japanese equities may be ready to deliver strong returns irrespective of the Olympic Games. In 2021, the Nikkei 225 index is up close to 6% and hit a multi-year high in February; in fact, the index saw its highest level since 1991.

Therefore, today we introduce two exchange-traded funds (ETFs) that could appeal to readers who are bullish on Japanese equities in the coming weeks.

1. WisdomTree Japan Hedged Equity Fund

Current Price: $62.47
52-Week Range: $44.63 - $62.58
Dividend Yield: 2.21%
Expense Ratio: 0.48% per year

The WisdomTree Japan Hedged Equity Fund (NYSE:DXJ) gives access to a range of dividend-paying Japanese stocks while hedging exposure to fluctuations between the Japanese yen (covered here) and the US dollar. The ETF hedges against depreciation in the yen.

DXJ Weekly
DXJ Weekly

DXJ, which has 400 holdings, tracks the WisdomTree Japan Hedged Equity Index. The fund began trading in June 2006 and has close to $1.67 billion under management.

In terms of sectors, industrials have the highest weighting with 19.59%. Next in line are consumer discretionaries (17.56%), financial (15.81%) and information technology, (13.82%) among others.

More than 32% of the funds are in the top 10 stocks. Toyota (NYSE:TM), Takeda (NYSE:TAK), Japan Tobacco (OTC:JAPAF) and Nintendo (OTC:NTDOY) are among the leading names in the fund.

Since the start of the year, the ETF is up about 14.5% and hit a record high in recent days. Interested investors could regard a decline toward $60 as a better entry point into DXJ.

2. WisdomTree Japan SmallCap Dividend Fund

Current Price: $76.05
52-Week Range: $61.92 - $80.40
Dividend Yield: 2.48%
Expense Ratio: 0.58% per year

The WisdomTree Japan SmallCap Dividend Fund (NYSE:DFJ) provides exposure to dividend-paying small-cap companies in the Japanese equity market. Companies are selected initially by removing the 300 largest Japanese companies by market capitalization and weighing the rest based on their annual cash dividends paid.

DFJ Weekly
DFJ Weekly

The fund, which tracks the WisdomTree Japan SmallCap Dividend Index, started trading in June 2006. It currently has 693 stocks.

The top 10 holdings comprise around 7% of total net assets, which is currently more than $211.7 million. Among the top names are Seven Bank (OTC:SVNBY), parts and machine tools manufacturer, JTEKT (OTC:JTEKY), transportation conglomerate, Nippon Yusen Kabushiki Kaisha (OTC:NPNYY) and trading giant, Sojitz (T:2768), whose segments include machinery, energy, metals, chemicals and consumer lifestyle.

As far as sector allocations are concerned, industrials lead with 26.39%, followed by consumer discretionary (16.71%), materials (14.49%), IT (11.13%) and financials (11.11%).

DFJ has returned close to 5% year-to-date. The fund offers relatively stable dividend payments as well as the possibility to benefit from growth prospects in Japanese small caps. Long-term investors should look to buy the dips, especially if there is a decline below $70.

Chasing Olympic Glory: 2 Japanese ETFs That May Win Big In Run-Up To The Games
 

Related Articles

Chasing Olympic Glory: 2 Japanese ETFs That May Win Big In Run-Up To The Games

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
M Asgher M Asgher
M Asgher M Asgher Jun 08, 2021 1:21PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
hi I don't understand 😭
Jaycom Osaruyiwmen
Jaycom Osaruyiwmen Jun 08, 2021 11:31AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
great analysis, looking forward for more you .
Rose jaranya
Rose jaranya Jun 08, 2021 11:06AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Ch Wasim
Ch Wasim Jun 08, 2021 11:06AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Ch Wasim
Ch Wasim Jun 08, 2021 11:06AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Mohamed Salah
Mohamed Salah Jun 08, 2021 11:06AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Ch Wasim
Ch Wasim Jun 08, 2021 11:06AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
yas
song whatspp status
song whatspp status Jun 08, 2021 11:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Min Myat
Min Myat Jun 08, 2021 11:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Asif Khan
Asif Khan Jun 08, 2021 11:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Asif Khan
Asif Khan Jun 08, 2021 11:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Can I say something to you about my problem
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email