6 Best Single-Country ETF Plays Of 2013

December 04, 2013

4. The WisdomTree Japan Hedged Equity ETF (DXJ | B-45) is up 37.7 percent, year-to-date

DXJ is by far the most popular ETF this year, having attracted more than $8.7 billion in net new assets year-to-date. DXJ has been rising sharply this year on the heels of a Japanese economic recovery fueled by an aggressive quantitative easing program there.

Prime Minister Shinzo Abe's ambitious "Abenomics" expansionary plan has definitely attracted investors who are hoping for some upside. The Nikkei 225 is now up roughly 51 percent year-to-date—the best-performing stock market in the world this year.

A lot has been said about DXJ's quick rise to success following the implementation of “Abenomics” earlier this year. Indeed, Japan's ongoing quantitative easing program is the most aggressive the market has yet seen.

What has helped DXJ’s gains and asset gathering has been its first-to-market status—one that has given it a competitive edge in the asset gathering game. The fund’s revised methodology late last year that essentially tilted the portfolio’s exposure toward exporters also has helped it. Export-focused companies are the very same that benefit the most from a weakening yen.

DXJ also takes off the table exposure to currency risk, something that has proven worthwhile in a year when the yen has plummeted against the U.S. dollar. DXJ is now an $11 billion fund.


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