Allocations to Japanese mutual funds set to rise this year

05 February 2014   Category: News, Asia, Global, USA, Europe   By Maya Ando

Retail investors in Japan are poised to raise their allocations to mutual funds this year, according to Nomura Asset Management. The house says in a research note that these allocations will also be driven by the need to raise long-term retirement savings.
In a recent survey conducted by the firm, the findings show that mutual funds make-up 17% of household accounts,  an increase of three per cent from the previous survey undertaken in 2012. Furthermore, the number of investors who intended to begin making these investments rose by three per cent, according to the survey.
In terms of risk appetite, survey respondents preferred to park their savings in low risk funds; about 65% of survey respondents also noted that they would opt for dividend paying funds but the percentage fell to 36% if the tax rate imposed on such income is to rise to 20%. More than 40,000 individuals were polled for the survey.
Last year, the Nikkei 225 rose 56.7%, its highest return in 41 years.