I am embarking on a new path with this blog to outline my thoughts on deep value stocks in Japan with the hope of sparking a discussion on stocks at a time when interest in my adopted home is on one of its periodical upticks.
It makes sense to start with what we know, or think we know, about investing in Japan
1) First, do no harm - minimize downside risk above all else, with the occasional lottery ticket exception that is priced right.
2) Value works in Japan, more so than elsewhere - a simple low P/B strategy is about all it takes to beat the indexes on a consistent basis, although there are plentiful ways to supplement this strategy.
3) Macro and micro differ - the decline of Japan is closely tied to the aging population and sclerotic major companies made famous in the 1980s, but a host of small cap companies are on a different trajectory altogether
4) Momentum matters - don't catch the falling knives, because things can always get cheaper in Japan.
In coming posts I hope to discuss some of my value picks I own and some I hope to own at the right price in the future.
Stocks I own:
Kuriyama 3355
Daiwa Industries 6459
Sakai Hikoshi Center 9039
Kawasaki Kinkai Kisen 9179
Stocks I am watching
Kato Sangyo 9869
Softbank Technology 4726
