Japan is a heaven for foreign investors after Shinzo Abe became the Prime Minister of Japan in December 2012. The country’s equities is over flowing with foreign investment and this year, till now, investors including BlackRock Inc has pulled out $46 million, which is a huge amount.

  This was possible when Shinzo Abe visited New York Stock Exchange in September 2013 with a message of “Japan is back”. From then on foreign investments started pouring into the country. But the hitch is Bank of Japan’s (BOJ) Negative interest rate, which hasn’t worked as effective as predicted, which has made the country to double up stimulus crossing $184billion.
  No one is sure if this will work, but in past artificially increasing the asset prices has never worked, because of which there is continuous outflow on money from Japan for past one year. Federal Reserve hiked their rates four times in 2016 as opposed to the normal two times which shows that perception’s importance in investment world.
  Investment Approaches
  If Shinzo Abe keeps on spending, more foreign investments will flow into Japan, which in turn will lead to higher equities. The situation will be similar to the US with Federal Reserve, but comparatively worse in Japan considering its oldest population and demographics. Japan being the second oldest populated country spending will be less unlike the US millennial generation. 
  Considering these components together, traders should seriously think about playing the bull side while investors about playing short.
  The approach to Japanese Market is via a 2x inverse exchange-traded fund (ETF) which has an expense ratio of 0.95%.  The ProShares UltraShort MSCI Japan (EWV), has appreciated 2.04% than the past year. Since its inception in 2007, November 16, it has depreciated by 83.32%, it tracks 2x the inverse performance of the MSCI Japan Index. 
  iShares MSCI Japan (EWJ) and WisdomTree Japan Hedged Equity ETF (DXJ) are worth considering if someone wants to go long in Japan.
  EWJ’s original net assets which were $17.12 billion came down by 27.97% since its inception on March 12, 1996 with a depreciation of 8.88% last year, which tracks the performance of mid-cap and large-cap stocks of MSCI Japan Index. It also focuses on consumer discretionary, financials and industrials. Though it offers a dividend of 1.34% this year, the expense ratio is 0.48%
  Similar to EWJ, DXJ is to track the performance of the WisdomTree Japan Hedged Equity Index. This is to track Japanese equities while also neutralizing exposure to the Japanese yen relative to the U.S. dollar.  With an expense ratio of 0.49% and yielding a dividend of 1.64% this year, DXJ has net assets of $9.79 billion, which has depreciated 22.15% last year with an overall depreciation of 17.13% since its inception on June 16, 2006. 
  The End Result
  The Japanese stocks may see a rally because of Shinzo Abe’s hostile approach despite its deflationary economy. This may lead to good things like more foreign investment into Japan as expected by the investors.