NEW YORK (TheStreet) -- The outlook for Japan's economy is far from perfect and the country has several issues confronting it, such as large government debt, an aging population, and persistent deflation.
However, the country's annualized GDP figure though for the fourth quarter of 2009 was recently reported to be the best figure since the first quarter of 2008, signaling an improved economic outlook for the world's second largest economy.
Even better, these ETFs are among the best performing international ETFs in 2010, with small gains compared to losses for many European and emerging market ETFs. Investors that want exposure to Japan should know what their choices are and here are the best fund options for three different strategies of investing in Japan.
For ETF investors interested in Japanese large-cap companies, iShares MSCI Japan Index Fund (EWJ) is the best choice. The fund's top three holdings are Toyota (TM), Mitsubishi UFJ Financial Group, and Honda Motor (HMC) Corp.The fund has 327 total holdings though, which is a relatively large number for a country-specific ETF, with the top three holdings account for only 5.2%, 3.0%, and 2.6%, respectively. The four most prominent sectors, which account for a combined 70.1% of the fund, are consumer discretionary, industrials, financials, and information technology. EWJ has a lower expense ratio than its mutual fund equivalents and its trading popularity gives it ample liquidity. Also, in a sign of investor bullishness on the fund, EWJ saw $232 million flow into the ETF last month.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV