The ETF replicates the performance of the TOPIX index, composed of 1,692 securities listed on the Tokyo Stock Exchange (TSE) First Section. In terms of number of securities, the TOPIX index is the most representative of the Japanese economy since it offers a much broader diversification compared to the other indices: the Nikkei in fact comprises 225 securities, while the MSCI Japan index considers approximately 370. âThe TOPIX index is widely used as key benchmark by institutional investors throughout the world, for measuring the performance of the Japanese economyâ confirms Isabelle Bourcier, ETF global Co-ordinator for Lyxor AM.
Mr. Taizo Nishimuro, Chairman & CEO of Tokyo Stock Exchange (TSE), Inc. comments: âTSE warmly welcomes the listing of an ETF based on the TOPIX index published and calculated by the TSE on the Borsa Italiana, allowing Italian investors better access to the Japanese equity based ETF. We firmly believe that through our good business relationship, the cross-border flow of capital between Europe and Japan will be further enhancedâ.
As explained by Mr. Massimo Capuano, CEO of Borsa Italiana S.p.A.: "Borsa Italiana is pleased to list on its markets the first ETF based on the TOPIX, one of the Japanese marketâs most important equity indices. The listing of Lyxor ETF Japan (TOPIX) is confirmation of the excellent relations existing between the two stock exchanges and represents a first significant result of the cooperation set up on May 30th of last year in Tokyo with the signing of the MOU".
The high number of securities included in the index enables a strong effective diversification of the portfolio. The top 10 securities according to capitalization in fact represent approximately 20% of the basketâs entire value and the top 20, less than 30%. The TOPIX index sectors with most weight are cyclical consumer goods (25%), financials (over 23%) and industrials (approximately 20%). Exposure to the more volatile sectors is low: energy and technology account for, respectively, 1% and 4.4%.
Lyxor ETF Japan (TOPIX) was launched on 17 November 2005, it will be admitted to continuous trading on Borsa Italiana as an equity, carries no entry/exit/performance fee and the annual management fee is 0.5%.
With the Japanese ETF, Lyxor enhances its range of equity ETFs which already offered the possibility to invest in the most important European (including the only ETF on the Italian S&P/MIB index) and American equity asset classes and those of the emerging Countries (China and Eastern Europe), through global and style instruments (growth, value, small cap). Lyxor also offers a wide range of bond ETFs that allow investors to take positions in Government Securities issued by the Eurozone Countries with various fixed durations (1-3 years, 3-5 years, 10-15 years, global) or inflation-linked.