"Buy Japan" Buffett Increases Stake in Japanese Trading Company to an Average of 8.5%

Investment company Berkshire Hathaway, led by 'investment master' Warren Buffett, has increased its stake in five major Japanese trading companies to an average of over 8.5%. The company also plans to maintain its long-term investment in these firms.

[Image source=AP Yonhap News]

According to Bloomberg and other sources, Berkshire Hathaway confirmed on the 19th (local time) in a statement that its subsidiary National Indemnity has expanded its holdings in the five major Japanese trading companies. These companies are Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. The total value of these stakes reportedly exceeds the total value of Berkshire Hathaway's stock holdings outside the United States, the company stated.

Earlier, Buffett expressed his intention to make additional investments in Japanese stocks, including trading companies, during his visit to Japan in April. Following this announcement, foreign investors' purchases of Japanese stocks surged. NHK reported that from March 27 to June 2, foreign investors bought more Japanese stocks than they sold for ten consecutive weeks. The Nikkei 225 index of the Tokyo Stock Exchange recently recovered to the 33,000 level for the first time in 33 years.

However, Berkshire Hathaway has not invested in other Japanese companies besides these trading firms. Separate from Buffett's investments, there are concerns about the potential for further stock price increases. Hiroshi Namioka, Chief Strategist at T&D Asset Management, evaluated, "Since the market has already factored in Buffett's additional purchases, the upside potential for these companies and the Japanese stock market overall may be limited."

On the same day, Berkshire Hathaway announced that Buffett would purchase up to 9.9% stakes in the five major trading companies. The current stance is that no purchases beyond this will be made unless specific approval is obtained from the board of directors. The company also confirmed its policy of long-term investment in these firms.