Good morning,
Last week I proposed this Q&A:
Q. So… who is doing all that buying and selling of stocks on the TSE (Tokyo Stock Exchange)?
A. Basically…1. The Japanese Government (see last week), 2. Corporations and 3. Individuals
- Corporations become listed (public) and sell shares (to the public) to gain access to the global investment community.
- Individuals, ie. you and me, meanwhile, buy specific company shares directly, or via funds – mutual, ETFs, Indexes, etc. – that hold a portfolio of company shares.
Japanese Individual investors (vs Americans)
Article. The Japanese Need to Learn to Invest Before It’s Too Late. True? About 10% of savings are in stocks
Article. Ex-Nomura exec opens school to help shift Japan’s savings to stocks
Article. Americans: 60% are in stocks – about 40% of their savings. It’s a big difference!
Investing In Japan – Foreign Perspective
Article. Positive Outlook – A foreign perspective
Video with script. (7 min). Japan Equity Funds Performance. Also quite positive! It’s technical, is use the script if you like.
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Bonus material. About Mutual Funds and ETFs
Who wants the risk of picking specific stocks? Very few people. About 5% of stocks are bought directly, the rest is Mutual Funds, ETFs and various types of “indexes”.
Article & Video (2 min). Mutual Funds and ETFs. Two common options to spread your risk,
Article. Understanding Mutual Funds. Similar to the above, but more great jargon and simple graphics. Plus lots more personal investing learning.
List. Biggest ETF Management Companies on the JPX. It’s just a list – just in case you’re in the market for a fund…
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March Dialogues: Business Funding and the Balance Sheet.
The stock markets are only a piece of the financing puzzle. Companies can raise funds using Debt (long & short-term, borrowing & bonds, on & off-balance sheet, convertible…), Equity (private equity, venture capital, crowdfunding), and even Grants. It’s all found on a company’s Balance Sheet.
April Dialogues: Unique Business Success Stories
In April we’ll look at interesting, important, cool and unique businesses – small and large – that are making an impact.
Enjoy,
Best,
Eric Cole
EDC Business Strategies
On Feb 18, 2023, at 13:27, Eric Cole <eric@edcbenchstrength.com> wrote:
Good afternoon,
So far, we’ve looked at why stock exchanges were created, how and why companies go public or private, what causes share prices to move, and more. See Parts 1 and 2 attached.
Q. So… who is doing all that buying and selling of stocks on the TSE (Tokyo Stock Exchange)?
A. Well… the answer is, basically … 1. The Japanese Government, 2. Corporations and 3. Individuals. In all three, ETFs & Funds play a big role.
1. Government
BOJ. Bank Of Japan.
Article: Criticism of BOJ being top shareholder in Japanese stocks. A bit technical, perhaps, but worth knowing about.
Article. BOJ and GPIF hold 12% of market – large stakes in 84% of listed companies. From 2020, but still relevant.
GPIF. Government Pension Investment Fund of Japan.
Article. GPIF, World’s Largest Pension Fund Posts Loss. Even the most powerful and diversified funds can lose.
Article. GPIF Now Investing In Startups. 32% of USA VC funds come from Pension Funds. In Japan, it’s only 3%!
Video (2 min). GPIF works for all generations. A promo video, but some simple listening.
Video (6min). How GPIF revolutionized sustainable investing. A very powerful message from the boss.
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Bonus Material on GPIF
Annual Report. GPIF Annual Report 2021. Like corporate annual reports, this one is full of great Business English learning.
Article. GPIF Explained
Next week…
We’ll look at 2. Corporations and 3. Individuals
SNEAK PEAK… Renowned ex-Nomura exec opens school to help shift Japan’s savings to stocks. I think this is very telling about individual investing in Japan.
Enjoy.
Best,
Eric Cole
EDC Business Strategies
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Part 2 Stock Markets.
On Feb 11, 2023, at 10:58, Eric Cole <eric@edcbenchstrength.com> wrote:
Good morning,
We all survived the “heavy snowfall warning” forecast for Tokyo last week. The reality failed to live up to the expectation: very little fell and none stayed on the ground for long!
This can happen in the stock market too, and often does, since there are many things at play affecting share and bond prices. We learned last week that stock markets follow the economy over the longer run, but they often don’t in the shorter run. Just as share prices will reflect companies’ underlying value over time, prices often swing wildly along the way.
Article. What Causes Share Prices to Change? Yes, indeed, there’s a lot at play
IPOs – Initial Public Offerings – Where it all starts for Listed/Public Companies
- Article and Video (5 min). IPOs and How They Work. There’s a lot involved!
- Article. The Pros and Cons of “Going Public”. There’s a lot to consider!
- Article. Why Some Companies Go Private. Yes, it’s the opposite of an IPO!
IPOs In Japan
- Article. Few IPOs in Japan in 2022… but Kishida’s New Capitalism will need lots of them!
- Article & listening. Socionext achieves top prices in IPO. Share price is up 100% since October 2022 IPO.
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Bonus Material. Stock Market and Financial Jargon. Great Fun!
Check out this jargon. Now, you’ll understand everything you read / hear about the markets.
Bull and Bear Markets. The ups and downs…
Common and Preferred Stocks. Not all shares are created equal
Share Buybacks. Companies often buy their own listed shares back
Dollar Cost Averaging. To reduce the risks for investors: buy/sell at high and low points.
…
Bonus Bonus Article & Video (8 min). If you’re really keen.
The IPO Market – From Boom to Bust in 2022. A wide-ranging CNBC review
Enjoy!
Best,
Eric Cole
EDC Business Strategies
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Part 1 Stock Markets.
On Feb 4, 2023, at 8:50, Eric Cole <eric@edcbenchstrength.com> wrote:
Good morning,
You can’t read or listen to the news without hearing about domestic and global stock markets:
- Are indexes up or down overall? What were the big stock price moves?
- New listings or delistings, big M&A transactions, shareholder activist activity.
- Stock market connections to economic performance, currencies, global events, etc.
If you are investing in funds, indexes or public / listed companies, you may follow market moves. For everyone, though, does stock market activity matter? I think we can learn a lot about economics and business in stock market news.
Today, we’ll look at some history of stock markets, their purpose and role in society. In future weeks, we’ll look at how investors and companies use them, types of stocks and other instruments, and so on. As always, enjoy the topics and materials, and most importantly, polish up your English!
Articles. First of all, here are reports for yesterday (Feb 3) and for all of 2022. Just to get a taste of typical Japanese stock market news.
Articles and Quick Videos. The Birth of Stock Exchanges and What Is the Stock Market, What Does It Do, and How Does It Work? Cool to learn how coffee shops, sinking ships and slate led to the virtual markets of today.
Article: The history of “Kabuto-cho”, where Tokyo Stock Exchange is located. Dating back to 1603 – very interesting.
Video (7 min). The Difference Between the Stock Market and the Economy.Q: Does Economic performance affect the markets? What about the other way around? A. Yes and No. Note: He’s a fast talker, but a lot to learn from him.
Bonus Material:
Article. JPX Website. Japan restructures the stock markets in April 2022. It’s a bit technical, but some clear graphics too. Japan restructured the markets to be more globally attractive.
Article. JPX Website. Real-time market data. Updated every minute. Just look around.
Finally, grab some popcorn and snacks and watch Netflix!
Video (20 min) Netflix: on the role of stock markets in society – A USA-centric view. Like a documentary and some fun learning.
There is just so much great business jargon all through these materials. So, whether you are an active market investor or not, I hope you’ve learned a few new things today about the markets, and all the great Business English it uses!
Enjoy!
Best,
Eric Cole
EDC Business Strategies