After a year of stellar returns from Japan, investors are concerned the Japanese equity funds that beat competitors in 2013 will not be able to deliver again this year.
The country’s flagship Nikkei index rose 57% last year and the best performing fund in the IMA Japan sector, Legg Mason Japan Equity, made a whopping 62% over the year. However, with Japan posting a record high annual trade deficit in 2013, markets are concerned the so-called ‘third arrow of Abenomics’, structural reform, is not working as it should. The Nikkei index tumbled on the news, and fell again last Thursday after the US Federal Reserve confirmed it will push ahead with tapering. Further selling this week, incuding a huge 4.2% fall overnight - means the Nikkei is down 14% in t...
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