After $8053 (-0,19 %) last month, the next Japanese stock is leaving my portfolio. As already mentioned, I am not too bullish on the Japanese market and since Itochu has been falling for months, it was quite easy for me to sell.

Next week, the decision on a possible interest rate hike in Japan is due. Although the interest rate level in Japan is still very low, the last Japanese interest rate hike caused quite a stir and price losses.

Due to the development of wages and prices in Japan, the professionals are also expecting a rise in key interest rates

I am therefore reducing my Japan position in the portfolio from 5% to around 3.5% and Sumitomo is out. The following remain in the portfolio for the time being $8001 (-0,05 %) Itochu and $8002 (+0,37 %) Marubeni remain in the portfolio.

Rio Tinto $RIO (+1,14 %) shares Winu valued at 2 billion US dollars following a buy-in deal with a Japanese heavyweight partner

Japanese mining giant Sumitomo Metal Mining $8053 (-0,19 %) has paid A$615 to join Rio Tinto in its underdeveloped Winu copper-gold province in the Great Sandy Desert.

Winu, which famously began the rush for the land in the once desolate East Pilbara after its discovery in 2017, will now be split 70-30 between Rio Tinto and Sumitomo.

Rio Tinto has been looking for viable partners for Winu since January this year.

There were several local options on the table

- recently, The Australian had reported that South32 and IGO were both interested - but it was Rio Tinto's new Japanese partners who signed the AUD615 million deal earlier this week.

Sumitomo has already paid US$195 million, with US$204 million bundled into "deferred consideration" which will then be capitalized at certain milestones.

As part of the transaction, both parties entered into a letter of intent to work together to develop a broader strategic partnership.

$8053 (-0,19 %) First position 💪

It was about time🤣

Today with Marubeni $8002 (+0,37 %) my third Japan position in the portfolio.

Marubeni is a wonderfully boring broadly diversified trading and industrial conglomerate, which complements my long-term portfolio well.

The valuation is fair, but of course includes the usual conglomerate discount. The development of the balance sheet and P&L over the past years is just as continuously positive as the share performance and the dividend development (3% p.a. with strong div growth). Although the stock may be somewhat overbought, the MACD is positive, as is the SMA 20/50/200.

On the risk side, one must certainly mention the increased currency risk, among other things, also due to the current interest rate differentials, such as a possible upcoming interest rate hike by the Japanese central bank, which is likely to lead to turbulence on the Japanese stock markets.

With Itochu $8001 (-0,05 %) and Sumitomo $8053 (-0,19 %) Japan now has a 6% share in my portfolio, so that should be fine.

And while I'm at it....

Rio is building a hydrogen plant in Australia together with $8053 (-0,19 %) (who are unfortunately not in the depot) a hydrogen plant. I like that. Plus the dividend yield of just under 8% and upside potential as soon as the economy in China really picks up again.

As is well known, Rio usually does quite well over the winter. Just cyclical. However, the position is only one third full. So there is still room.

Sumitomo $8053 (-0,19 %)

Today happened to see one of my machines as a shareholder in use under difficult conditions.

Use in the rainy season in Thailand ... and the machine runs ... Business case unchanged given 😉

About GQ I was made aware of the jap market, which I had completely hidden. Something rummaged (also in the GQ portfolios) and yesterday opened my first jap. position.

Sumitomo has amS solid numbers and especially an attractive chart. Of course, you have to like conglomerates, but for a long-term investment, I hope for a reliably growing pole of tranquility with attractive dividends in the portfolio and therefore also accept the currently strongly increased share price.

Also on the shopping list for Japan in the next few days are $8001 (-0,05 %) This would close Japan in my portfolio for the time being with a share of about 5%.

Warren Buffett was "deeply irritated" by opportunity in Japan

Last week it became known that star investor Warren Buffett's investment holding company Berkshire Hathaway had raised fresh money in the form of yen by issuing bonds.

Now Warren Buffett has confirmed that Berkshire Hathaway has increased its stake in the five Japanese trading companies Mitsubishi, Mitsui, Itochu, Marubeni and Sumitomo to 7.4% each and is considering further investments in Japan.

Buffett is currently in Tokyo for talks and gave an extensive interview to U.S. financial broadcaster CNBC on Wednesday. In the interview, Buffett also explained why he originally joined the Japanese trading houses in August 2020.

"I was deeply irritated by the fact that we were able to buy into these companies," Buffett said. The stocks had "an earnings yield of maybe 14% or something like that, but the dividends would go up."

The earnings yield is the inverse of the price-to-earnings (P/E) ratio, which is a more common metric. A high earnings yield corresponds to a low P/E ratio and vice versa. An earnings yield of 14%, as mentioned by Buffett, corresponds to a P/E ratio of about 7. So Buffett was mainly surprised by the fact that the shares of Japanese trading houses could be had so cheaply. Despite interim price gains, the shares are also currently trading at very favorable fundamental valuations.

Buffett emphasized in the interview that these were great companies "that I generally understood what they were doing." He also said the Japanese trading houses were comparable to Berkshire in that they owned many different holdings. "And they were sold at what I think was a ridiculous price, especially compared to the prevailing interest rates at the time."

The Mitsubishi, Mitsui, Itochu, Marubeni and Sumitomo groups are large trading houses that deal in raw materials, intermediate products, finished goods and services, among other things. In Japan, these corporations are also known as Sōgō Shōsha.

Only copy paste but interesting

Source Stock3 : https://stock3.com/news/warren-buffett-war-zutiefst-irritiert-ueber-chance-in-japan-12191603

$8058 (-0,44 %)
$8031 (-0,98 %)
$8001 (-0,05 %)
$8002 (+0,37 %)
$8053 (-0,19 %)