A new report from Aite Group, LLC provides an analysis of the Japanese securities and investments market, including market and technology trends, an industry structure overview, and industry asset projections.
It also identifies potential market opportunities for both financial institutions and technology vendors.
The report provides an overview of this thriving market, which is attracting interest from foreign investors and financial institutions, following a decade long recession.
“One of the major changes within the Japanese economy in recent years has been the increased participation in the securities market by retail investors. Driven by the rapid adoption of online trading, Japanese consumers have become an integral part of overall market growth, not only in the equities market, but also in other, more risky asset classes, such as retail FX,” says Sang Lee, managing partner, Aite Group and co-author of the report.
Japan’s assets under management, as of year end 2006, were approximately $2.9 trillion and are expected to grow at an annual rate of 28%, reaching $5.6 trillion by 2010. While Japanese investors only have 19% of their wealth in securities, compared to 52% of US investors’ wealth, total retail investment assets continue to grow quite rapidly. However, the pension community remains the dominant force in the Japanese asset management industry, with approximately $2.3 trillion in assets.
“Japanese investors of all types are benefiting from an ever-increasing variety of investment products, from target date funds, to environmentally-conscious investments, to infrastructure-related securities and emerging markets. While there is a strong preference for dividend-paying investments and even global government bonds, hedge funds and fund of hedge funds are gaining popularity and growing,” adds Denise Valentine, senior analyst, Aite Group and co-author of the report.