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Trading Japanese Stocks Online

Trading Japanese Stocks

Published: 19th June 2017

Hello, and welcome to the first post of this blog about Trading Japanese Stocks.

The stocks are available to trade online via brokers that cater to the Retail Trader. I use a company called Monex which I like apart from the fact that there is no English Language Support so I tend to use Google Translate a lot.

The only need to talk to a member of staff seems to be when setting up your account. At the time of looking for a suitable broker, all of them seemed to be in Japanese as you may expect. However, I don't have any major issues when using the trading platform.

But, I miss out on some of the features of the site regarding analysis, news, and live charting. And one thing I don't know how to do yet which I should figure out is how to cancel a pending order. Unlike most functions, this one is not obvious how to do it.

If you have traded stocks before, many features of the trading platform will be familiar such as the price displays where we have the stock and it's 4 digit code, the bid and ask prices, high and low price records, and volume.

The buy and sell button colours are back to front with Europe where in Japan red indicates buying and blue is for selling.

A big plus over UK stock trading is that there is no 0.5% stamp duty on purchases. So the window between profit and loss is narrower. For example, many stocks have a tight spread of a couple of yen and the commission may be just 100 yen per deal so you can move into profit more easily.

Another plus is that the price data is live at no extra cost. In the UK I had to pay for an expensive live price feed since 15 minute delays on prices are useless for day trading.

Tax on profits is easy to take care of. I registered to have consumption tax deducted on each profitable sell trade. So I don't need to do annual tax accounting and settling any tax bill seperately.

Transferring money in and out via a linked account is easy too, and doesn't seem to incur fees. Just when you input funds, you need to do some compliance check via checking an agreement box.

When trading, I am able to specify limits to trigger my buys/sells and specify over what period the instruction should remain active. Much the same as what you would expect from a UK online broker. In fact, I set a limit on every trade that I initiate so that I don't get zapped by a sudden price swing whilst I submit my order to the vultures of the market.

The trading hours are convenient since there is a lunch break and early finish. The hours are: 9:00 - 11:30 in the morning and 12:30 - 15:00 in the afternoon, on weekday working days. Lunch wimps rule!

Monday morning can be a bit wild since Japan is one of the first markets to open with built-in uncertainty since Europe and America are asleep.

And then we have a guy firing missiles into the sea of Japan on a regular basis.

The price swings can be very erratic with trends instantly reversing, so you wonder what is going on much of the time, imagining nervous traders panic selling as soon as they finally edge into profit. In fact, I did once read an article about a single guy trading from home that could move markets because his positions were so large.

Then we have corporations sitting on massive amounts of cash that they are afraid to invest whilst prime minister Abe tries various tactics to try to get people to spend and invest in the economy.

I believe that the recently privatised Post Office can only drip feed it's pension fund cash pile into the market to avoid being too overweight as a shareholder in particular companies and not artificially move the market.

I am excited to make more money in this market and feel like it is a big puzzle to solve and crack the code for making bumper profits. I look forward to sharing my experiences and ideas on this blog. Happy trading!