Psigma’s Becket increases position in Japanese equities

Chief investment officer Tom Becket said investors’ concerns about the country were overplayed, adding that the market is one of the cheapest in the world.

The Japanese Topix index has fallen by 7.3 per cent so far this year in sterling terms, with certain sectors falling much further.

Mr Becket said the fall was down to concerns that the country’s reform plan – dubbed ‘Abenomics’ after prime minister Shinzo Abe – is failing, as well as fears the increase in consumption tax in April will have a crippling impact on the economy.

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But Mr Becket insisted that “Abenomics is working” and that the “economy is now strong enough to withstand the rise” in consumption tax.

Mr Becket said he had been adding to his holdings because the pull-back meant Japanese equities were trading on cheaper valuations than before the market’s huge rally that began at the end of 2012.

He said investors shouldn’t wait for a catalyst to invest as they might miss out, but he said he expected the giant Government Pension Investment Fund to up its weighting to domestic equities soon, which could have “huge” market impact.