Japan ETFs

Loading the player...

DEFINITION of 'Japan ETFs'

A type of exchange-traded fund that invests the majority of its assets in Japanese equities that trade on local stock exchanges. The performance of Japan ETFs does not correlate to the performance of the underlying index when measured in U.S. dollars, because the change in the exchange rate between the yen and the dollar must be taken into consideration. The performance of Japan ETFs is thus dependent on two things: the performance of the underlying equities and the effect of changing yen into dollars.

BREAKING DOWN 'Japan ETFs'

Japan ETFs are managed passively around a broad underlying index, such as the MSCI Japan Index, which represents over 75% of the total market capitalization of all listed Japanese equities.

The Tokyo Stock Exchange is one of the largest and most progressive markets in Asia, making the country a frequent source of investor focus and attention. Japan ETFs allow for a single diversified investment in the country while also making a bet on the strength of the yen versus the dollar.

Because of the depth of Japan's equity markets, ETFs that focus on large- or small-cap stocks are available. As with several of the larger, more liquid ETFs, some Japan ETFs can be sold short and are even accessible through listed options.

RELATED TERMS
  1. ETF Of ETFs

    An exchange-traded fund (ETF) that tracks other ETFs rather than ...
  2. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets ...
  3. Yen ETF

    Exchange-traded funds that invest primarily in yen-backed assets ...
  4. Stock ETF

    A security that tracks a particular set of equities, similar ...
  5. Index ETF

    Exchange-traded funds that follow a specific benchmark index ...
  6. Passive ETF

    One of two types of exchange-traded funds (ETFs) available for ...
Related Articles
  1. Mutual Funds & ETFs

    Japan Equity ETFs to Date 2016 Performance Review (JPMV, DXJF)

    Discover how Japan equity ETFs performed through the first quarter of 2016, including a review of the best and worst performers in this category.
  2. Mutual Funds & ETFs

    The Top 5 ETFs For Investing in Japan (HEWJ, EWJ)

    Look at a list of some of the best Japan ETFs in today's market, and how investors can use hedged or leveraged ETFs to mitigate risks or exaggerate returns.
  3. Mutual Funds & ETFs

    JSC Vs. EWJ: Comparing Japan ETFs

    Learn about the Japanese markets, the challenges faced in 2016 and comparative analysis of the SPDR Small Cap Japan ETF and the iShares Japan ETF.
  4. Mutual Funds & ETFs

    The 5 Largest Japan ETFs (EWJ, DXJ)

    Discover several of the largest Japan ETFs, as measured by assets under management, and learn about the investment exposure each provides.
  5. Mutual Funds & ETFs

    5 Popular Japan ETFs in 2016 (EWJ, BLK)

    Learn the top five popular picks for investment in Japan through exchange-traded funds that focus on different aspects of the economy.
  6. Stock Analysis

    How to Go Long or Short Japan via ETFs (EWJ,DX)

    These ETFs offer ways to go long or short Japan.
  7. Mutual Funds & ETFs

    Exchange-Traded Funds: Conclusion

    Although the first exchange-traded funds (ETFs) were designed to track broad market stock indexes, since that time, ETFs have been developed to track industrial sectors, investment styles, fixed ...
  8. Economics

    3 Economic Challenges Japan Faces in 2016

    Understand the important challenges for Shinzo Abe and the Bank of Japan to help Japan's economy escape deflation in the coming year.
  9. Mutual Funds & ETFs

    Building An All-ETF Portfolio

    Balance is the key when selecting an all-ETF portfolio that will hedge against market volatility.
  10. Mutual Funds & ETFs

    Exchange-Traded Funds: Introduction

    Exchange-traded funds (ETFs) can be a valuable component for any investor's portfolio, from the most sophisticated institutional money managers to a novice investor who is just getting started. ...
RELATED FAQS
  1. Do ETFs pay capital gains?

    Learn about exchange-traded funds (ETFs), which can generate capital gains for their shareholders due to occasional and substantial ... Read Answer >>
  2. Besides stocks, what other asset classes can I invest in through ETFs?

    Discover the extremely far-reaching range of investment asset classes that are available to investors through exchange-traded ... Read Answer >>
  3. Should I invest in ETFs or index funds?

    Learn advantages to investing in exchange-traded funds, or ETFs, and index funds, and decide whether to include them in your ... Read Answer >>
  4. Who's in charge of managing exchange-traded funds?

    An exchange-traded fund (ETF) is a security that tracks an index but has the flexibility of trading like a stock. Just like ... Read Answer >>
  5. What's the difference between an index fund and an ETF?

    Learn about the difference between an index fund and an exchange-traded fund and how index fund investing compares to value ... Read Answer >>
  6. Who regulates the various types of exchange traded funds (ETFs)?

    Discover who regulates various types of exchange-traded funds. The share of investment capital going towards ETFs continues ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center