The arrest of Nissan’s Carlos Ghosn underscores a key principle of Japanese corporate governance: greed and manipulation for personal gain will not be tolerated. Jesper Koll discusses how the high-profile Ghosn case can serve as an important case study for what good governance and good regulatory policing requires of corporate leaders in Japan.
The drop in Japan’s third-quarter GDP does not mark the start of a recession, but it does underscore that neither the Bank of Japan nor fiscal policy has room to change. Jesper Koll explains three fundamental trends to watch for.
Japan is not a value trap. Our analysis suggests the probability of a sharp positive inflection in earnings visibility is about to be delivered in Japan, possibly as early as the upcoming fiscal half-year results season, which is about to get going by the end of October.
The Japanese markets are trading near their lowest valuation levels in the last 30 years, with increased profitability and better returns on capital and improving profit margins. Yet investors aren’t interested. Here is why we believe Japan is an underowned value opportunity.
On Thursday, Japanese prime minister Shinzo Abe was re-elected as the ruling Liberal Democratic Party leader, winning by a very solid 70-30 margin against his one internal competitor. This bodes well for Japan’s economy in general, and Japanese risk assets in particular.
Jeremy J Siegel
Senior Investment Strategy Advisor
CEO of WisdomTree
Jeremy Schwartz, CFA
Executive Vice President, Global Head of Research
Christopher Gannatti, CFA
Head of Research, Europe
Christopher Gannatti began at WisdomTree as a Research Analyst in December 2010, working directly with Jeremy Schwartz, CFA®, Director of Research. In January of 2014, he was promoted to Associate Director of Research where he was responsible to lead different groups of analysts and strategists within the broader Research team at WisdomTree. In February of 2018, Christopher was promoted to Head of Research, Europe, where he will be based out of WisdomTree’s London office and will be responsible for the full WisdomTree research effort within the European market, as well as supporting the UCITs platform globally. Christopher came to WisdomTree from Lord Abbett, where he worked for four and a half years as a Regional Consultant. He received his MBA in Quantitative Finance, Accounting, and Economics from NYU’s Stern School of Business in 2010, and he received his bachelor’s degree from Colgate University in Economics in 2006. Christopher is a holder of the Chartered Financial Analyst designation.
Head of Fixed Income Strategy
Tripp Zimmerman, CFA
Head of Fixed Income & Currency
Associate Director, Asset Allocation and Modern Alpha
Head of Capital Markets
Associate Director of Capital Markets
Head of Europe
Joseph Tenaglia, CFA
Associate Director, Asset Allocation
Jianing Wu joined WisdomTree as a Research Analyst in October 2018. She is responsible for analyzing market trends and helping support WisdomTree’s research efforts. Previously, Jianing completed internships and projects at Geode Capital, Starwint Capital, and Invesco Great Wall Fund Management with a focus in quantitative research. Jianing received her M.S in Finance from the Massachusetts Institute of Technology. She graduated with honors from Boston College with degrees in Mathematics and Philosophy.
Jeff Weniger, CFA
Director, Asset Allocation
Alejandro Saltiel, CFA
Associate Director of Modern Alpha
Alejandro Saltiel joined WisdomTree as a Quantitative Research Analyst in May 2017. He is responsible for quantitative research on WisdomTree’s products and global equity markets. Prior to joining WisdomTree, Alejandro worked at HSBC Asset Management’s Mexico City office as Portfolio Manager for multi-asset mutual funds. He started his career working at a boutique hedge fund that specialized on trading options on sector-levered ETFs. Alejandro received his Master’s in Financial Engineering degree from Columbia University in 2017 and a Bachelor’s in Engineering degree from the Instituto Tecnológico Autónomo de México (ITAM) in 2010. He is a holder of the Chartered Financial Analyst designation.
Matt Wagner, CFA
Modern Alpha Analyst
Matt Wagner joined WisdomTree in May 2017 as a member of the Research team. He is responsible for research on WisdomTree’s products and communicating the firm’s views on the markets. Matt started his career at Morgan Stanley, working as an analyst in Treasury Capital Markets from 2015 to 2017 where he focused on unsecured funding planning, execution and risk management. Matt graduated from Boston College in 2015 with a B.A. in International Studies with a concentration in Economics. Matt is a holder of the Chartered Financial Analyst designation.
Investment Strategy Analyst
Brian Manby joined WisdomTree in October 2018 as an Investment Strategy Analyst. He is responsible for assisting in the creation and analysis of WisdomTree’s model portfolios, as well as helping support the firm’s research efforts. Prior to joining WisdomTree, he worked for FactSet Research Systems, Inc. as a Senior Consultant, where he assisted clients in the creation, maintenance and support of FactSet products in the investment management workflow. Brian received a B.A. as a dual major in Economics and Political Science from the University of Connecticut in 2016, and is pursuing the Chartered Financial Analyst designation.
Ryan Krystopowicz, CFA
Associate, Asset Allocation
Ryan Krystopowicz joined WisdomTree in March 2016 as a member of the Distribution Team and has transitioned over to the Asset Allocation Team as a Product Specialist, ETF Model Portfolios. He is responsible for maintaining and delivering data and content associated with WisdomTree Model Portfolios. Ryan also supports model development and decisions, as well as contributes to the commercial success of Model Portfolios by supporting the sales and client solutions team. He started his career at a Registered Investment Advisor working as Research Analyst and Assistant Trader. Ryan received a degree from Loyola University of Maryland and is a holder of the Chartered Financial Analyst designation.
Kara Marciscano, CFA
Quantitative Research Analyst
Jeremy Schwartz recently spoke with Jawad Mian, editor of “ Stray Reflections,” and Richard Clarida, global strategic advisor to PIMCO and economics professor at Columbia, regarding their thoughts on policy action by the Federal Reserve (Fed), the Bank of Japan (BOJ) and the European Central Bank (ECB), as well as global implications for investing. Below I outline the key takeaways.
It is the time of year when economists and strategists present their forecasts and baseline scenarios for the year ahead, 2016. Quantitative forecasts are based on de facto probability models, and qualitative scenarios are based on, well, a combination of experience and common sense. Either way, most methodologies leave little room for a discussion of true outliers and surprises.
Last week, Japanese prime minister Shinzo Abe presented an update on his economic policy priorities for 2016 and beyond. The new details of Japan’s “Abenomics 2.0” policy discussion suggest to us that structural growth policy is very much moving in the right direction, with Team Abe making concrete progress on building credible alliances with business leaders for his growth strategy.
The Bank of Japan decided to maintain its steady policy course this week, very much in line with consensus expectations. However, its policy statement did add a twist to a previously mentioned sentence.