New Japanese Small-Cap ETF Fund Is Promising

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.
[Japanese Prime Minister Shinzo Abe]

Earlier this year, I wrote about taking advantage of Abenomics and the Bank of Japan’s plan to create inflationary, yen-weakening pressures in the Japanese economy to spur exports and growth. One of this year’s many new exchange-traded funds (ETFs), WisdomTree Japan Hedged SmallCap Equity Fund (DXJS), plays right into that strategy.

For that reason, I want to introduce you to DXJS. The fund seeks to reproduce, before fees and expenses, the performance of an index of small-cap Japanese equities. The index hedges against exposure to fluctuations between the value of the U.S. dollar and the Japanese yen. Specifically, the index is designed to have higher returns when the yen is weakening relative to the U.S. dollar. This fund is non-diversified.

The fund has gained 10.79% since its inception date of June 28, 2013. There have been no dividends issued as yet.


The fund is heavily weighted towards industrials, 26.66%, and consumer discretionary, 24.38%. Other sectors include materials, 11.65%; financials, 11.16%; consumer staples, 10.39%; information technology, 9.98%; and health care, 4.32%. The top 10 holdings constitute only 6.42% of this ETF’s assets. The top held companies are Iida Group Holdings Co Ltd, 0.85%; Denki Kagaku Kogyo K K, 0.73%; Ube Industries Ltd/Japan, 0.69%; Tokai Tokyo Financial Holdings, 0.69%; and Kinden Corp, 0.69%.

This fund is attractive not only because it’s a play in a recovering Japanese market and because it’s a small-cap fund (and therefore focused on selling to the second-largest developed economy in the world), but also because it uses a hedging strategy to take advantage of a deliberate policy of weakening the yen against the dollar. If this all seems like good news to you, you may be interested in WisdomTree Japan Hedged SmallCap Equity Fund (DXJS).

Exclusive  Bet on Health with This Cap-Weighted Fund

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful Investing newsletter. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

share on:
share on:


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income PRO (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options Alert
  • Hi-Tech Trader

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader

Used by financial advisors and individual investors all over the world, is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor