Characteristics of Japanese Stock Trading

There are subtle intricacies of Japanese economic analysis and stock-picking that are strange to Americans and Europeans, but the securities trading environment is stable.

Japan stocks move in well-defined themes, and these can change quickly. Scarcity value magnifies demand and price movement.

Perhaps even more than in the U.S., you must be cognizant of the global and Japanese economic environment, particularly with respect to China and also Taiwan and South Korea. You must also understand the role that domestic interest rates and foreign-exchange movements can have on the stocks you are trading.

Japanese traders, especially individuals, love technical analysis and charts.

Even if you are strictly a fundamentalist in your investment approach, you must still be aware of key price points and trends in Japanese stocks. For consistent success, you need to be acquainted with support and resistance, trend-lines, and Japanese candlestick charts.

Currency movement (the Yen vs. Dollar) is a major factor in trading Japanese equities. If you buy these stocks or ETFs, paying USD, you can hedge your currency position by also buying Japanese Yen in the currency market, but I suggest you'd have to be a big securities trader to do that.

Back to Japanese Stocks

Back to Main Article