The Japanese economy, along with related exchange traded funds (ETFs), are heavily dependent on the health foreign economies. A new dominant political party, however, plans to look inward to accomplish the country’s economic goals.

The Democratic Party of Japan (DPJ) plans to support small- and medium-sized businesses, a major shift from the former Liberal Democratic Party’s inclination toward big businesses, comments Patricia Oay for Morningstar. In addition, Prime Minster Yukio Hatoyama is proposing stronger trade relations with neighboring Asian countries, which would further benefit Japanese businesses.

Potential investors seeking some allocation in Japan may consider broad market ETFs or small-cap ETFs, depending on where your interests happen to be.

  • iShares S&P/TOPIX 150 Index (NYSEArca: ITF): up 0.2% year-to-date


  • iShares MSCI Japan Index (NYSEArca: EWJ): up 1.2% year-to-date


  • iShares MSCI Japan Small Cap Index (NYSEArca: SCJ): up 6.1% year-to-date


  • WisdomTree Japan SmallCap Dividend (NYSEArca: DFJ): up 5% year-to-date


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