Foreigners Swap Bets On Japan’s Stock Index For Select Shares | 1/6/2020 | Staff
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TOKYO (Reuters) – Foreign investors are dumping derivatives contracts on Japan’s TOPIX equity index but buying up individual, select company shares in a trade investors and analysts say is a vote of confidence in the earnings potential of companies.

Investors outside Japan net sold TOPIX futures last week at the fastest pace in almost four months and turned net buyers of cash equities for the first time in three weeks.

Investment - Managers - Bets - Gains - TOPIX

Active investment managers are likely paring bets on gains in the broader TOPIX index, which includes many small illiquid companies, and instead investing in companies in the Nikkei 225 with better liquidity that will benefit from a pickup in global semiconductor demand, investors and analysts said.

“This looks like an active strategy where investors get out of the TOPIX because it is not rising so much,” said Kiyoshi Ishigane, chief fund manager at Mitsubishi UFJ Kokusai Asset Management Co in Tokyo.

Investors - Equities - Shares

“However, these investors are still positive on Japanese equities, so they’re buying individual shares that they expect to rise faster...
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