Is The Sun Rising For Japan With This 15 Percent Return?

Back in August, 2012, a practice portfolio was created on Kapitall.com, at the height of the tension between China and Japan. Large positions with allocations of over 10% for Japanese-based companies were added. By November, 2012, shares in these large capitalization companies declined at their maximum levels, leaving the portfolio with a loss of 6.38%. Investors breathed a sigh of relief at the start of 2013, after a short-term resolution to the fiscal cliff was found. Japan’s stocks rose too:

The top holdings are:

1)     Toyota Motors (TM) – up 21.88%. An unexpected rise in US auto sales in December helped support shares in Toyota. Toyota sold 9% more vehicles in December, or 194,143 vehicles.

2)     Honda Motors (HMC). Up 17.93%. Honda shares also rose as demand for automobiles improved.

3)     Canon Inc. (CAJ) – shares recovered, returning 14.85%, as investors warmed to the computer and technology firm.

4)    Panasonic Corporation (PC). Up 21.54%. Shares are on a downward trend, after shares peaked at $9.35 in January 2012.

5)     Sony Corporation (SNE). Down 5.38%. Sony does not have any major products that will help improve its profits. A PS4 console will not be launched until the end of 2013, at the very earliest. The photography division is improving.

6)     iShares MSCI Japan Index (EWJ). Up 5.57%. The small return relative to the other holdings illustrates that ETFs can underperform individual companies. This ETF pays a dividend yield of 1.92%, which helped generate a positive return.