Many asset allocators put an overweight to Japan in place over the past year as they whittled down US, UK and emerging markets exposure.
The asset class has been volatile recently as can be seen below, but the allocation shift has been a partial success so far, at least for those who made it in the first quarter of 2015 or before.
There was a significant wobble in August but that was in line with world markets and resulted from the turmoil in China's stock market. There was a significant climb back from late September on.
As this chart based on a survey of European asset allocators produced by our sister publication Expert Investor shows, few are planning to cut back anytime soon and significant numbers are planning to add to their Japanese equities weightings.
Japanese equities sentiment:
The question is, to what degree is this favouring of Japanese equities deserved based on the merits in isolation. Or, is it a relative judgement based on the unattractiveness of other developed market equities.
The corporate governance reforms under way could be the key to how this story pans out.