How to invest in Japan using ETFs

How do I invest in Japanese stocks?

The easiest way to invest in the whole Japanese stock market is to invest in a broad market index. This can be done at low cost by using ETFs.

On the Japanese stock market you find 7 indices, which are tracked by ETFs. Besides these indices 3 alternative indices on small and mid caps or equity strategies can be considered.

A speciality for ETFs on Japan is the large number of currency hedged ETFs that are available. In total there are 3 currency hedged indices tracked by 11 ETFs.

Alternatively, you can consider indices on the Pacific region. In the Pacific indices, Japan is strongly weighted with around 67%.

0.09% p.a. - 0.59% p.a.
annual total expense ratio (TER) of Japan ETFs
on the Japanese stock market, which are tracked by ETFs
on the Japanese stock market
The best indices for Japan ETFs

Performance of Japanese stocks (MSCI Japan)

1 month: -1.86%
1 year: 7.49%
3 years: 10.33%
5 years: 46.37%

Indices in comparison

The best indices for ETFs on Japan

For an investment in the Japanese stock market, 7 indices tracked by 22 ETFs are available. On the FTSE Japan index there is 1 ETF. On the JPX-Nikkei 400 index there are 3 ETFs. On the MSCI Japan index there are 11 ETFs. On the MSCI Japan Investable Market (IMI) index there is 1 ETF. On the MSCI Japan Large Cap index there is 1 ETF. On the Nikkei 225® index there are 4 ETFs. On the TOPIX® index there is 1 ETF. The total expense ratio (TER) of ETFs on these indices is between 0.09% p.a. and 0.59% p.a..

Index Investment focus Number of ETFs Number of constituents Short description

FTSE Japan

Japan 1 ETF 503
(29.12.17)
The FTSE Japan index tracks Japanese large and mid cap stocks.
Index factsheet

JPX-Nikkei 400

Japan 3 ETFs 400
The JPX-Nikkei 400 index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit.
Index factsheet

MSCI Japan

Japan 11 ETFs 321
(29.12.17)
The MSCI Japan (total return) index tracks around 320 leading stocks on the Japanese market.
Index factsheet

MSCI Japan Investable Market (IMI)

Japan 1 ETF 1,210
(31.10.16)
The MSCI Japan Investable Market (IMI) index tracks large, mid, and small capitalisation companies in Japan.
Index factsheet

MSCI Japan Large Cap

Japan 1 ETF 138
(29.12.17)
The MSCI Japan Large Cap index tracks Japanese large cap stocks.
Index factsheet

Nikkei 225®

Japan 4 ETFs 225
The Nikkei 225® index tracks the 225 most actively traded stocks on the first section of the Tokyo Stock Exchange.
Index factsheet

TOPIX®

Japan 1 ETF 2,037
(30.11.17)
The TOPIX® (total return) index tracks over 1,900 Japanese stocks on the TSE First Section segment of the Tokyo Stock Exchange, which comprises the largest market capitalisations.
Index factsheet
ETF
ISIN
  Fund size
in m EUR
TER
in %
Use of profits Fund domicile Replication method
iShares Core MSCI Japan IMI UCITS ETFIE00B4L5YX21 3,348 0.20% p.a. Accumulating Ireland Optimized sampling
Xtrackers MSCI Japan Index UCITS ETF 1CLU0274209740 1,979 0.30% p.a. Accumulating Luxembourg Full replication
Vanguard FTSE Japan UCITS ETFIE00B95PGT31 1,848 0.19% p.a. Distributing Ireland Full replication
iShares MSCI Japan UCITS ETF (Dist)IE00B02KXH56 1,411 0.59% p.a. Distributing Ireland Optimized sampling
Lyxor Japan (Topix) UCITS ETF D-EURFR0010245514 993 0.45% p.a. Distributing France Full replication
UBS ETF (LU) MSCI Japan UCITS ETF (JPY) A-disLU0136240974 808 0.35% p.a. Distributing Luxembourg Full replication
Xtrackers Nikkei 225 UCITS ETF 1DLU0839027447 606 0.09% p.a. Distributing Luxembourg Full replication
iShares MSCI Japan UCITS ETF (Acc)IE00B53QDK08 450 0.48% p.a. Accumulating Ireland Full replication
Amundi Index MSCI Japan UCITS ETF - EUR (C)LU1602144732 279 0.45% p.a. Accumulating Luxembourg Full replication
iShares Nikkei 225 UCITS ETF (Acc)IE00B52MJD48 233 0.48% p.a. Accumulating Ireland Full replication
Source JPX-Nikkei 400 UCITS ETF ADE000A119T29 229 0.19% p.a. Accumulating Ireland Unfunded swap
Xtrackers JPX-Nikkei 400 UCITS ETF 1DIE00BPVLQD13 205 0.20% p.a. Distributing Ireland Optimized sampling
HSBC MSCI Japan UCITS ETF USDDE000A1C0BD3 190 0.19% p.a. Distributing Ireland Full replication
iShares Nikkei 225 UCITS ETF (DE)DE000A0H08D2 173 0.51% p.a. Distributing Germany Full replication
Amundi JPX Nikkei 400 UCITS ETF - EUR (C)LU1681038912 131 0.18% p.a. Accumulating Luxembourg Unfunded swap
Deka MSCI Japan UCITS ETFDE000ETFL300 54 0.50% p.a. Distributing Germany Full replication
ComStage Nikkei 225 UCITS ETFLU0378453376 45 0.25% p.a. Distributing Luxembourg Unfunded swap
Lyxor Core MSCI Japan (DR) UCITS ETFLU1781541252 17 0.12% p.a. Accumulating Luxembourg Full replication
ComStage MSCI Japan TRN UCITS ETFLU0392495452 14 0.25% p.a. Distributing Luxembourg Unfunded swap
Source MSCI Japan UCITS ETF AIE00B60SX287 13 0.19% p.a. Accumulating Ireland Unfunded swap
Deka MSCI Japan Large Cap UCITS ETFDE000ETFL102 10 0.50% p.a. Distributing Germany Full replication
SPDR MSCI Japan UCITS ETFIE00BZ0G8B96 4 0.30% p.a. Accumulating Ireland Optimized sampling
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
MSCI Japan Large Cap -1.67% 3.29% 0.74% 7.30% 12.76%
JPX-Nikkei 400 -1.85% 3.41% 0.54% 7.30% 15.83%
MSCI Japan -1.85% 3.34% 0.33% 7.86% 13.82%
TOPIX® -2.40% 2.06% 0.39% 7.90% 16.71%
FTSE Japan -1.92% 3.34% 0.67% 8.27% 15.96%
MSCI Japan Investable Market (IMI) -1.96% 3.37% 0.91% 8.72% 17.94%
Nikkei 225® -0.39% 7.30% 3.16% 11.93% 22.66%
Index   2018
in %
2017
in %
2016
in %
2015
in %
2014
in %
MSCI Japan 0.33% 9.00% 5.81% 20.62% 7.75%
TOPIX® 0.39% 10.27% 6.62% 22.73% 8.12%
JPX-Nikkei 400 0.54% 9.61% 5.80% 22.17% -
MSCI Japan Investable Market (IMI) 0.63% 9.96% 6.50% 23.08% 8.69%
FTSE Japan 0.67% 9.60% 5.65% 23.35% 9.17%
MSCI Japan Large Cap 0.74% 8.25% 5.63% 20.33% 6.52%
Nikkei 225® 3.16% 10.69% 8.95% 22.23% 8.06%

Source: justETF.com; As of 30.06.18; Calculations in EUR based on the largest ETF of the respective index.

 

The cheapest Japan ETFs
by total expense ratio (TER)

Show all

Japan ETFs with hedged currency risk

Currency hedged investing in Japanese stocks is popular. In total, you can consider 3 currency hedged Japan indices tracked by 11 ETFs. The total expense ratio (TER) of ETFs on Japan indices with currency hedge is between 0.18% p.a. and 0.64% p.a..

 
Index Investment focus Number of ETFs Number of constituents Short description
JPX-Nikkei 400 (EUR Hedged) Japan 4 ETFs 400
The JPX-Nikkei 400 EUR Hedged index tracks 400 Japanese stocks. The stocks are mainly selected by return on equity and cumulative operating profit. Currency hedged to Euro.
Index factsheet
MSCI Japan (EUR Hedged) Japan 5 ETFs 321
(29.12.17)
The MSCI Japan index tracks around 320 leading stocks on the Japanese market. 100% currency hedged to Euro.
Index factsheet
TOPIX® (EUR Hedged) Japan 2 ETFs 2,037
(30.11.17)
The TOPIX® EUR Daily Hedged (total return) index tracks over 1,900 Japanese stocks on the TSE First Section segment of the Tokyo Stock Exchange, which comprises the largest market capitalisations. Currency hedged to Euro.
ETF
ISIN
  Fund size
in m EUR
TER
in %
Use of profits Fund domicile Replication method
iShares MSCI Japan EUR Hedged UCITS ETF (Acc)IE00B42Z5J44 2,119 0.64% p.a. Accumulating Ireland Optimized sampling
Xtrackers MSCI Japan Index UCITS ETF 4C (EUR hedged)LU0659580079 1,002 0.40% p.a. Accumulating Luxembourg Full replication
Amundi Japan Topix UCITS ETF Daily Hedged - EUR (C)LU1681037864 815 0.48% p.a. Accumulating Luxembourg Unfunded swap
Lyxor Japan (Topix) UCITS ETF Daily Hedged D-EURFR0011475078 372 0.45% p.a. Distributing France Full replication
UBS ETF (LU) MSCI Japan hedged EUR UCITS ETF (EUR) A-accLU0950672476 362 0.45% p.a. Accumulating Luxembourg Full replication
Amundi JPX Nikkei 400 UCITS ETF Daily Hedged - EUR (C)LU1681039134 167 0.18% p.a. Accumulating Luxembourg Unfunded swap
iShares JPX-Nikkei 400 EUR Hedged UCITS ETFIE00BQT3W831 56 0.25% p.a. Accumulating Ireland Optimized sampling
Source JPX-Nikkei 400 UCITS ETF EUR HedgedIE00BVGC6645 52 0.19% p.a. Accumulating Ireland Unfunded swap
Xtrackers JPX-Nikkei 400 UCITS ETF 3C (EUR hedged)IE00BRB36B93 45 0.30% p.a. Accumulating Ireland Optimized sampling
ComStage MSCI Japan 100% Daily Hedged Euro UCITS ETFLU1033694107 6 0.45% p.a. Distributing Luxembourg Unfunded swap
SPDR MSCI Japan EUR Hedged UCITS ETFIE00BZ0G8C04 4 0.35% p.a. Accumulating Ireland Optimized sampling
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
JPX-Nikkei 400 (EUR Hedged) -0.13% 1.40% -4.45% 7.37% 5.74%
MSCI Japan (EUR Hedged) 0.04% 1.60% -4.38% 7.58% 3.62%
TOPIX® (EUR Hedged) -0.23% 1.21% -4.61% 7.70% 6.85%
Index   2018
in %
2017
in %
2016
in %
2015
in %
2014
in %
TOPIX® (EUR Hedged) -4.61% 20.18% -2.25% 11.06% 8.69%
MSCI Japan (EUR Hedged) -4.58% 18.52% -3.17% 9.06% 7.95%
JPX-Nikkei 400 (EUR Hedged) -4.45% 18.96% -2.51% - -

Source: justETF.com; As of 30.06.18; Calculations in EUR based on the largest ETF of the respective index.

 
Alternative investment opportunities

Japanese indices on small and mid caps or equity strategies

Alternatively, you may invest in indices on small and mid caps or equity strategies. In total, you can invest in 3 alternative indices on Japan tracked by 3 ETFs. The total expense ratio (TER) of ETFs on these alternative indices is between 0.30% p.a. and 0.58% p.a..

 
Index Investment focus Number of ETFs Number of constituents Short description
MSCI Japan Mid Cap Japan
Mid Cap
1 ETF 183
(29.12.17)
The MSCI Japan Mid Cap (price) index tracks Japanese mid cap stocks (end of day).
Index factsheet
MSCI Japan SRI Japan
Social/Environmental
1 ETF 70
(31.12.15)
The MSCI Japan SRI index tracks Japanese stocks considering only companies with very high Environmental, Social and Governance (ESG) ratings relative to their sector peers, to ensure the inclusion of the best of class companies from an ESG perspective.
Index factsheet
MSCI Japan Small Cap Japan
Small Cap
1 ETF 930
(29.12.17)
The MSCI Japan Small Cap (total return) index tracks Japanese small cap stocks.
Index factsheet
ETF
ISIN
  Fund size
in m EUR
TER
in %
Use of profits Fund domicile Replication method
iShares MSCI Japan Small Cap UCITS ETF (Dist)IE00B2QWDY88 700 0.58% p.a. Distributing Ireland Optimized sampling
iShares MSCI Japan SRI UCITS ETFIE00BYX8XC17 33 0.30% p.a. Accumulating Ireland Full replication
Deka MSCI Japan MC UCITS ETFDE000ETFL318 2 0.50% p.a. Distributing Germany Full replication
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
MSCI Japan Mid Cap -1.95% 4.02% -0.02% 7.06% 16.35%
MSCI Japan SRI -1.99% 3.79% 1.02% 7.64% -
MSCI Japan Small Cap -2.53% 3.15% 1.55% 11.46% 33.79%
Index   2018
in %
2017
in %
2016
in %
2015
in %
2014
in %
MSCI Japan Mid Cap -0.02% 10.37% 4.96% 22.18% 11.26%
MSCI Japan SRI 1.02% - - - -
MSCI Japan Small Cap 1.55% 15.00% 10.64% 28.09% 12.56%

Source: justETF.com; As of 30.06.18; Calculations in EUR based on the largest ETF of the respective index.

 

Pacific indices with a large share of Japan

Besides, Japan ETFs you can consider ETFs on the Pacific stock market. On the Pacific region 3 indices tracked by 11 ETFs are available. The MSCI Pacific index contains a significant weight of Japan with around 67%. The total expense ratio (TER) of ETFs on the Pacific region is around 0.45% p.a..

 
Index Investment focus Number of ETFs Number of constituents Short description
MSCI Pacific Asia Pacific
Japan: 66.70%
(29/12/2017)
1 ETF 471
(29.12.17)
The MSCI Pacific index tracks the equity markets of the developed markets in the Pacific region.
Index factsheet
ETF
ISIN
  Fund size
in m EUR
TER
in %
Use of profits Fund domicile Replication method
ComStage MSCI Pacific TRN UCITS ETFLU0392495023 247 0.45% p.a. Distributing Luxembourg Unfunded swap
 
Index   1 month
in %
3 months
in %
6 months
in %
1 year
in %
3 years
in %
MSCI Pacific -1.70% 4.54% 0.53% 7.12% 14.15%
Index   2018
in %
2017
in %
2016
in %
2015
in %
2014
in %
MSCI Pacific 0.53% 8.96% 7.63% 14.03% 10.18%

Source: justETF.com; As of 30.06.18; Calculations in EUR based on the largest ETF of the respective index.