In early April, the Japanese stockmarket hit multi-year highs. Fund managers and regional experts assess the way forward for the country in: What next for Japan?
iShares launches currency-hedged Japan ETF
By Tanzeel Akhtar | Tue, 1st October 2013 - 14:24
BlackRock exchange traded funds (ETF) platform iShares has launched a new currency-hedged Japanese ETF which was listed on the London Stock Exchange (LSE) on Tuesday.
The new product is the iShares MSCI Japan USD Hedged UCITS ETF (IJPD) and has a total expense ratio of 0.64%.
iShares said the offering will allow investors to mitigate currency risk in a single trade in a volatile foreign exchange environment. The product will give investors access to Japan whilst minimising the impact of movements in the yen to US dollar exchange rate.
Tom Fekete, head of products at iShares EMEA, commented: "In recent years, the volatility in global currency rates has caused significant swings in the international portfolios of investors. Japan has been attracting new interest in anticipation of positive effects from 'Abenomics' but investors are paying closer attention to how they can control currency risk when gaining exposure to this market."
Japan has been popular with investors recently - the Abenomics initiative aims to get rid of deflation. This is the name given to the measures Japanese Prime Minister Shinzo Abe is taking to increase the economy's competitiveness through the "three arrows": fiscal stimulus, aggressive monetary easing from the Bank of Japan and structural reforms.
The groups said iShares MSCI Japan USD Hedged UCITS would invest in Japanese equities in a way that seeks to protect investors from the impact of fluctuations between the base currency of the fund, the US dollar, and the currency denomination of the underlying investments, the yen. The ETF is hedged against currency movements on a monthly basis.
Earlier this year Boost ETP listed short and leveraged Japanese ETFs on the LSE.
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