Investors are adding on Japan hedged-equity exchange traded fund positions as a weaker yen currency helps energize the economy and more companies begin returning value back to investors.
Since the start of May, the WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ) has attracted $68.3 million in net assets, iShares Currency Hedged MSCI Japan ETF (NYSEArca: HEWJ) saw $95.6 million in new inflows, Deutsche X-trackers MSCI Japan Hedged Equity ETF (NYSEArca: DBJP) experienced $93.3 in inflows and WisdomTree Japan Hedged Small Cap Fund (NasdaqGM: DXJS) added $10.4 million, according to ETF.com.
Meanwhile, flows into Japanese equity funds hit their highest level since the second quarter of last year, reports Roger Blitz for the Financial Times.
Investors were “attracted by the clarity of [Japan’s] current economic policies and the valuations of Japanese stocks,” according to EPFR Global.
The Bank of Japan’s loose monetary policy is performing as intended, with governor Haruhiko Kuroda stating that the economy is growing and inflation is inching higher. Consequently, the BOJ may hold off on further monetary easing. [Aggressive Easing Sustains Japan ETFs]
“I therefore don’t think additional monetary easing is necessary at this stage,” Kuroda said.