Readers will be aware that Japan is one of my favoured markets. The market performed well last year, but scepticism remains as to whether this is yet another false dawn – there having been several in recent decades.
The market has long offered ‘value’ – in part reflected by price-to-book ratios comparing well with other markets – but share prices have generally failed to respond. That started to change last year. Many challenges remain, but omens for a sustained if gradual rally look more promising than they have for a while. The portfolios have maintained meaningful exposure to the market for a while and have been increasing exposure of late.