After a nasty 25-year bear market, Japan is still far cheaper than both U.S. and European equities, despite its huge rally, says IVA CIO and portfolio manager Charles de Vaulx.
Bridget Hughes: Hi, I’m Bridget Hughes, one of the analysts here at Morningstar, and I’m at the Morningstar Investment Conference. I’m here today with Charles de Vaulx, who joined us for ourInternational Opportunities panel.
Thank you, Charles, for joining us.
Charles de Vaulx: You’re welcome.
Hughes: I wanted to start by asking you about Japan, because you’re one of the few international global investors that actually has had a meaningful commitment to Japanese stocks, and has had so for a long time.
It’s one of the best-performing markets this year. How do you feel about the story in Japan? And then, how do your stocks kind of fit into that story, or are they distinct from it?
Charles De Vaulx: You’re right. We had a pretty high allocation to Japan over the past few years. We have taken advantage of this huge rally that started mid-November last year to trim some positions. In fact, we’re down to around 8% in Japan in our worldwide fund, down to around 16% only in our pure international fund.