While the falling yen may help export sales, it can be a mixed blessing for U.S. investors. The problem is the weak currency makes Japanese stocks less valuable for foreigners. So if the yen drops 10%, as it did in recent months, the value of a Japanese stock would decline by that amount for a U.S. investor. To bet on Japan at a time of a falling yen, investors should prefer WisdomTree Japan Hedged Equity, says Dennis Hudachek, an analyst for IndexUniverse.com. Using futures and other tools, the fund neutralizes the impact of the currency moves on U.S. investors. "With the yen weakening, the currency hedge could have tremendous value," says Hudacheck. Because it did not suffer from the falling currency, the WisdomTree fund has outperformed unhedged competitors recently. During the past three months, the WisdomTree fund returned 25.6%, while iShares MSCI Japan, an unhedged fund, returned 12.1%. Last year, WisdomTree took steps to magnify the impact of the weak yen on returns. In the past, the fund held a cross section of Japanese dividend payers. Big holdings included telecom and utilities companies. But WisdomTree reckoned that such stocks are unaffected much by currency moves because the companies obtain little or none of their sales from exports. To eliminate the domestic businesses, the portfolio managers instituted a rule that all stocks in the fund must obtain at least 20% of their sales from exports. The change eliminated some telecom and utilities stocks. Now big holdings include Honda Motor ( HMC), which has 81% of its sales from exports, and Nissan ( NSANY), which gets 79% abroad. While the outlook for exports remains positive, the picture could change if a crisis in Europe or the U.S. sends investors scurrying back to the safety of the yen. A rise in the currency would hurt Japanese stocks. But odds seem good, that the new Japanese regime will carry through on its program to weaken the yen and pump up the export economy. Follow @StanLuxenbergThis article was written by an independent contributor, separate from TheStreet's regular news coverage.