Investors can utilize a relatively new Japan telecom, media and tech sector exchange traded fund to fill out their exposure to growth stocks in the strengthening Japanese markets.
The WisdomTree Japan Hedged Tech, Media & Telecom Fund (NYSEArca: DXJT) provides exposure to some of Japan’s most cyclically sensitive sectors, including technology, media and telecommunication stocks. Additionally, the ETF provides an added hedged-equity focus that helps limit the negative effects of a depreciating yen currency on the investment’s overall returns. DXJT began trading April 8. [A New ETF With a Backdoor to Alibaba]
Over the past month, DXJT has been a winning theme for Japan exposure, gaining 8.6% and outperforming other broad Japan ETFs.
The iShares MSCI Japan ETF (NYSEArca: EWJ) is up 6.1% over the past month. Meanwhile, the WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ) has increased 6.0% and db X-trackers MSCI Japan Hedged Equity Fund (NYSEArca: DBJP) rose 6.4% over the past month. The two hedged equity ETFs also diminish the negative effects of a depreciating yen currency. [Japan ETFs Fly on Abenomics’ Third-Arrow]
DXJT can help investors augment their Japan stock exposure in a bullish market with growth stocks. Specifically, the sector ETF includes a 57.6% weight toward technology stocks, 20.1% in telecom, 12.9% in industrials and 9.1% in consumer cycicals, according to Morningstar data.
With DXJT, investors gain a heavier tilt toward large and prominent Japanese telecom and tech names, such as Softbank Corp. 9.4%, Canon (NYSE: CAJ) 7.0%, Hitachi 6.3%, Panasonic 4.6% and Sony (NYSE: SNE) 3.5%.
In comparison, the other broad Japan ETFs favor consumer discretionary and financial stocks. EWJ’s top sectors include consumer discretionary 20.5%, financials 20.% and industrials 19.7%. DXJ’s sector weights include industrials 26.6%, consumer discretionary 22.0% and information technology 16.0%. Lastly, DBJP includes consumer discretionary 22.6%, financials 19.9% and industrials 19.9%.
WisdomTree Japan Hedged Tech, Media & Telecom Fund
For more information on Japan, visit our Japan category.
Max Chen contributed to this article.