2 Jul 2015
Japan's giant pension funds to invest more aggressively in domestic equities
FXStreet (Bali) - As the Nikkei reports, the Japanese Government Pension Investment Fund (GPIF) and three mutual pension funds are about to embark upon a more aggressive investment stance on the Japanese stock market.
The four big whales like local waters
From Nikkei: “GPIF's new strategy allows for the actual ratio to be nine percentage points above or below the 25% target. The three other whales on the Japanese stock market -- the Pension Fund Association for Local Government Officials (Chikyoren), the Federation of National Public Service Personnel Mutual Aid Associations (Kokkyoren) and the Promotion and Mutual Aid Corp. for Private Schools of Japan (Shigaku Kyosai) -- are all expected to ramp up their domestic stock purchases, too.”
Impact on the Yen
The more the Nikkei 225 is buoyed by GPIF buying, the more sources of supply the Japanese Yen should find during Asian hours. Even the anticipation of that occurring will most likely produce a self-fulfilling prophecy in which the market starts to price in and bet for the rise of Japanese stocks, which should help keep the Yen heavy, barring risk-off markets or BoJ easing expectations being tempered.
The four big whales like local waters
From Nikkei: “GPIF's new strategy allows for the actual ratio to be nine percentage points above or below the 25% target. The three other whales on the Japanese stock market -- the Pension Fund Association for Local Government Officials (Chikyoren), the Federation of National Public Service Personnel Mutual Aid Associations (Kokkyoren) and the Promotion and Mutual Aid Corp. for Private Schools of Japan (Shigaku Kyosai) -- are all expected to ramp up their domestic stock purchases, too.”
Impact on the Yen
The more the Nikkei 225 is buoyed by GPIF buying, the more sources of supply the Japanese Yen should find during Asian hours. Even the anticipation of that occurring will most likely produce a self-fulfilling prophecy in which the market starts to price in and bet for the rise of Japanese stocks, which should help keep the Yen heavy, barring risk-off markets or BoJ easing expectations being tempered.