The Tokyo Stock Exchange Tokyo Price Index, or TOPIX, is current hovering around 1,794.
Investors who are interested in gaining exposure to this segment of the global market have a number of ETF options to choose from, with currency-hedged strategies currently outperforming as the Japanese yen depreciates against the U.S. dollar.
The WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ) has been a go-to options to access Japanese equities markets while hedging against foreign exchange risks, but potential investors should keep in mind that the funds could underperform non-hedged funds if the yen strengthens.
ETF investors may also look to some relatively new dynamic or adaptive currency-hedged international stock strategies that changes its currency-hedge weight based on prevailing market conditions. For instance, WisdomTree also offers the WisdomTree Dynamic Currency Hedged Japan Equity Fund (BATS: DDJP), which hedge currency fluctuations in the relative value of the foreign currency against the USD, ranging from 0% to 100% hedge based on interest rate differentials, valuations and relative price momentum of the foreign currencies compared to the USD.
For more information on the Japanese market, visit our Japan category.