Eastspring Investments, an Asian asset management arm of British insurer Prudential Plc, is tapping into opportunities arising from a weaker yen by launching a Japanese equity fund.
Industrial plays and other undervalued stocks are among its top picks, the Hong Kong Economic Journal reported.
The crumbling yen is actually a big push for Japanese enterprises, especially when oil prices are slumping at the same time, as this means further reduction in costs and creates a reflationary force at a later stage, Eastspring investment director Kevin Gibson told the newspaper.
Electronics, consumer staple and banking counters have been undervalued for too long that it is now time to bet on them, Gibson said.
Japan’s economic outlook in the coming decade is strong, he said, citing the multilateral Trans-Pacific Partnership trade agreement with the United States which aims to eliminate import tariffs.
Domestic funds are also pouring into local stocks, with the Government Pension Investment Fund raising its holdings to 25 percent of its portfolio from 12 percent, Gibson said.
This article appeared in the Hong Kong Economic Journal on March 30.
Translation by Vey Wong
[Chinese version 中文版]
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