Japan ETFs In Focus As GDP Grows For 8 Straight Quarters

Japan is also subject to geopolitical risks, as Asian markets continue to suffer from massive volatility due to North Korea’s actions. Although North Korea’s participation in the Winter Olympics has been raising hopes that tensions will ease, some analysts are predicting that North Korea is aiming to create a wedge between South Korea and the United States, thereby worsening the scenario.

Increased geopolitical uncertainty makes us look for currency-hedged ETFs focused on providing exposure to Japan (see Asia-Pacific (Developed) ETFs here).

WisdomTree Japan Hedged Equity Fund (DXJ - Free Report)

This fund is suited for investors looking for a broad-based exposure to Japan’s economy. It seeks to invest in dividend-paying companies with an export tilt.

The fund has AUM of $7.9 billion and charges a fee of 48 basis points a year. From a sector look, Consumer Discretionary, Industrials and Information Technology are the top three allocations of the fund, with 25.5%, 22.8%, and 13.1% exposure, respectively (as of Feb 13, 2018). Toyota Motor Corp, Mitsubishi UFJ Financial Group, and Sumitomo Mitsui Financial Group are the top three holdings of the fund, with 5.7%, 3.7% and 3.3% exposure, respectively (as of Feb 13, 2018). It has returned 11.7% in a year. DXJ has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.

Deutsche X-trackers MSCI Japan Hedged Equity ETF (DBJP - Free Report)

This fund seeks to provide exposure to Japanese equities with a large-cap focus while hedging away the currency risk.

The fund has AUM of $1.6 billion and charges a fee of 45 basis points a year. From a sector look, Industrials, Consumer Discretionary, and Technology are the top three allocations of the fund, with 20.8%, 19.9% and 12.5% exposure, respectively (as of Feb 12, 2018). Toyota Motor Corp, Mitsubishi UFJ Financial Group, and Softbank Group Corp are the top three holdings of the fund, with 4.8%, 2.3% and 1.8% exposure, respectively (as of Feb 12, 2018). It has returned 12.0% in a year. DBJP has a Zacks ETF Rank #1 with a Medium risk outlook.

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