Kabu.com

For any MMM readers out there I'm sure you are already registered and posting on their nice new shiny forums they have.  I think these forums are an excellent place to get information and bounce ideas of of like minded people.  Your questions don't even have to be about FI!  I asked about photography and learning how to use a camera and got great information from several nice users.

So far the best part of the MMM forum have been not only meeting like minded people but meeting other like minded people that live in Japan.  Shortly after joining the forum I was messaged by a very nice gentleman who is in a similar situation to me.  He lives in Japan, teaches English, and is seeking FI.  However my new friend is dead set on staying in Japan for the rest of his happy days and therefore he is investing his money in domestic Japanese equities.

This was a great wake up call for me to start looking more at Japanese stocks.  However I feel there are good and bad points for investing in the market you live in.  For example if I lived in the USA and my local McDonalds or Coke distributor burns down or is robbed I might get an itchy trigger finger to sell the stock (unreasonably so I know).  But by living in Japan I don't get bogged down with the "news" that most people are inundated with every day and I can let my stocks just sit there and go up and down as they wish while I collect the dividends.  It's very out of sight out of mind.  On the other hand I don't know what's hip or up and coming necessarily.  It's hard for me to find new trends or physically see with my own two eyes how busy a particular industry is.  This is what I want to take advantage of here by investing in Japanese companies.  I have an eye from the ground view of what Japanese people are eating, buying, and what is trending.  This I feel gives me many advantages.  Plus many Japanese products start out local and then go global.  Tomogachi or Pokemon anyone?

Everything I have ever read about investing harps on the fact you need to diversify.  Putting all your eggs in one basket is like betting all your savings on a horse (you shouldn't bet anyway).  Well what better way to diversify than to hold equities in multiple countries?  Further more it would be nice to be able to track the prices of my stocks in real time.  With the US market I go to bed and wake up and the trading day has both started and ended!  With Japanese investments I can keep a closer eye on them.

My new friend introduced me to a website called kabu.com.  Kabu is the Japanese word for "stock" making the site name pretty self evident.  I'm in the process of getting signed up now so I haven't actually started trading just yet, but I wanted to point out some of the differences between Japanese and US stocks.

First from what I was told Japanese stocks are in general not as volatile and don't jump around as much as stocks in other markets.  That is good for my heart and my health.  I can sleep soundly at night.  Commission fees are also very low here in Japan.  Reading right off of the nice little chart they sent me fees start at 141 yen for trades up to approx. USD 500 (I'm just slicing off zeroes not running it through a currency converter).  236 yen up to USD 1500, 330 yen up to USD 2500, and 614 yen up to USD 5500!  Those are some nice fees!

Nice fees!

In addition to the dividends that I want to collect Japanese stocks are also have what I translate as "stock holder hospitality."  These are basically presents that they send out to stock holders who own a certain number of their shares.  For example I plan on purchasing 100 shares of Asahi beer.  This is the number one selling beer in Japan and I happen to really enjoy it.  I see people drinking it all the time and it pays a nice dividend.  Plus if I own 100 shares they will send me a pack of Asahi beer

One example of stock holder treatment in Japan.

Buy some coke stock and get some coke related merchandise.  Buy Kyupi stock (they make mayonnaise) and they will send you some mayonnaise.  Not all Japanese companies have this kind of stock holder gift policy but many do.  There are catalogs you can get that will outline several companies dividend as well as what kind of gift they are sending out.  

I think this whole idea is very Japanese.  Most westerners would rather forgo the gift and get a higher dividend (after all the companies are spending money to send you this "free" product when instead they could just pay you a higher dividend and I could buy it from the store).  However part of the thrill of investment is the feeling of being special.  How often does Johnson and Johnson send you a bottle of baby oil?  Probably not very often.  If they did it might make you feel special and more connected or confident about the product or company.  To me this is the idea behind these share holder gifts.

What about you?  Want to or already investing in Japan?