Japan Equities
Today’s price sits at the 56.8th percentile of modeled fair value — 40% of modeled scenarios put fair value above the market.
- Median fair value
- 97.2
- Upside to median
- -2.8%
- Last close
- $95.81
- Confidence
- moderate-high
Return distributions, not point forecasts
Percentiles describe the spread of scenario outcomes under the stated method. The width of the range carries as much information as the midpoint.
One year
modeled- P90
- +25.0%
- P75
- +17.5%
- Median
- +8.0%
- P25
- -1.5%
- P10
- -15.0%
71% of modeled scenarios end positive.
Total return decomposed into forward earnings growth of -6% to +14%, a change in the justified trailing multiple between 15.0x and 20.5x against the current 19.34x, and a 2.3% index dividend yield. Yen translation is treated as a symmetric unhedged exposure for a USD investor.
Three years, annualised
modeled- P90
- +16.0%
- P75
- +12.0%
- Median
- +7.5%
- P25
- +2.5%
- P10
- -4.0%
Three-year annualised total return from earnings compounding at 0% to 11% a year, a terminal trailing multiple between 16.0x and 18.5x, and a 2.3% dividend yield, discounted at a 7.5% to 8.0% required return.
Against the Treasury hurdle
- 1y Treasury
- 4.51%
- Expected excess
- +3.5%
- Basis
- direct
A modeled spread over the 4.51% one-year Treasury par yield, not a guaranteed excess return. The edge rests on earnings delivery and return-on-equity improvement rather than on a valuation discount, because Japan no longer trades at one.
5 in this asset class
| Symbol | Valuation | Fair value | Last close | 1y modeled |
|---|---|---|---|---|
| EWJ Japan Broad Market | -0.4Somewhat expensive | 97.2 | $95.81 | +8.0% |
| JPXN Japan JPX-Nikkei 400 | -0.3Fair | 97.5 | $102.15 | +7.8% |
| EWJV Japan Value Equity | +0.4Somewhat cheap | 104.0 | $47.97 | +9.0% |
| SCJ Japan Small-Cap Equity | +0.1Fair | 101.0 | $108.85 | +8.5% |
| DXJ Japan Hedged Equity | -0.9Somewhat expensive | 92.0 | $179.03 | +6.5% |