We’ve seen the evolution of Abenomics, and the 2015 manifestation has been a greater focus on returning cash to shareholders. Share buybacks have been an important avenue through which this has been accomplished. The WisdomTree Japan Hedged Dividend Growth Index had the highest buyback yield, 0.79%, as of July 2, 2015. The second highest was the WisdomTree Japan Hedged Financials Index, at 0.77%. The Index with the lowest share buyback yield was actually the WisdomTree Japan Hedged Real Estate Index, at about 0.14%.
Financials: A Strong Combination
So, even though the performance momentum has been so strong during the first half of 2015, the WisdomTree Japan Hedged Financials Index had the lowest P/E ratio, a competitive dividend yield even without being cash dividend weighted and the second highest buyback yield. As opportunities go for the second half of 2015, we think that the Japanese financials could still be of particular interest.
1Source: Bloomberg, for period 12/31/14–7/2/15.
2Source: Bloomberg, for period 12/2/13–7/2/15.
3Source: “Expansion of the Quantitative & Qualitative Monetary Easing,” Bank of Japan, 10/31/14.
Important Risks Related to this Article
Foreign investing involves special risks, such as risk of loss from currency fluctuation or political or economic uncertainty.
Investments focused in Japan increase the impact of events and developments associated with the region, which can adversely affect performance.