Japanese firms remain too expensive

japanese equities are 28% overvalued and china offers better prospects than the US over the long term, according to tom madsen of UBS

Japanese companies are expensive both on a top-down and a bottom-up basis, according to UBS's global head of equities Tom Madsen. Focusing on the global asset classes, Madsen said at present Japanese equities are some 28% overvalued, while, conversely, the UK is some 26% undervalued and emerging markets are 18% undervalued. Investors in Japanese companies, who are mostly foreign, are buying not on the returns they are generating but on the expectation of what they will return in the future, he noted. While not overly optimistic on Japan, Madsen argued that from a long-term perspective, th...