Investors in the Japanese and U.S. stock markets may end up nursing the same hangover in 2014, but for now they probably won’t let a little lull spoil the party.
Now that the Nikkei 225 has cooled a bit, questions are arising over whether the index’s nearly 70 percent surge over the past year has gotten overdone.
The simple answer is that while Japanese equities could be in for a brief pause, the buy-the-dip mentality remains firmly in place.
“When you’re up 60 percent in seven months you’re going to have a bit of a pullback, that’s to be expected,” Erik Davidson, deputy chief investment officer at Wells Fargo Private Bank, said in an interview. “Most U.S. investors are underexposed to Japan. That’s a big, big risk.”
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.