Dan Chamby, one of the co-managers of BlackRock’s top-performing Global Allocation Fund, is betting big on Japan.
“Japan is far and away the most attractive market,” Chamby told Bloomberg. “Japan is confronting an existential crisis and it’s a powerful stimulant for change.” Chamby added that “the threat of being overrun by China” has created a sense of urgency for the Japanese.
About 14% of the money invested in the funds Chamby manages is in Japanese companies. He has shares in about 130 Japanese firms, including construction stocks with large cash piles, and is looking to buy more if stocks fall, Bloomberg says. Japan “provides the best combination of macro policies with valuations and earnings,” he said. “If there were a meaningful correction, all else equal, we would probably be adding further.”
“The most interesting changes in Japan, and the most meaningful, are what’s happening at the corporate-governance level,” added Chamby. While a weaker yen has helped propel stocks, he thinks that’s changing, and gains will now be driven by the change in how companies are run. Chamby talks about some industries he’s high on, as well as one — drugmakers — he’s cutting back on.