The companies listed on the Nikkei 225 index include global brands such as Sony, Canon, Toyota, Nissan and many others. The 225 companies are spread out over 35 industries, with each stock measured based on its performance. You can buy individual shares via your broker or track the index by investing in a tracker fund or an exchange-traded fund (ETF).
Investing in the Nikkei 225 via an Index Fund
One of the most prominent Nikkei ETFs is that of the Nikkei 225 Exchange Traded Fund offered by Nomura Asset Management. Although the expense ratio is slightly higher at 0.22%, this still provides good value if you prefer the ETF route. The ETF itself operates on the Tokyo Stock Exchange, meaning that you have the option of trading it on the open marketplace at your will. As such, you will need to use a third party institution that tracks the Nikkei 225 index themselves. Each institution will have their own underlying mechanisms in their attempt to track the official index.
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Investing in the Nikkei
The performance of the Nikkei also influences other Asian stock markets due to Japan’s economic significance in the region. The Nikkei is short for Japan’s Nikkei 225 Stock Average, the leading and most-respected index of Japanese stocks. It is a price-weighted index composed of Japan’s top 225 blue-chip companies traded on the Tokyo Stock Exchange. The Nikkei is equivalent to the Dow Jones Industrial Average (DJIA) Index in the United States. You can trade this on the spot price, which is closest to the underlying price with low spreads, but includes overnight fees. Alternatively, you’ll trade via futures which have wider spreads but no overnight fees using our CFD trading account.
Historical Prices for NIKKEI 225
- Each institution will have their own underlying mechanisms in their attempt to track the official index.
- With an expense ratio of just 0.16%, this particular fund is one of the most competitively priced in the space.
- The only way to trade on the Nikkei 225 price directly with us is through our Japan 225 index.
- Native Japanese also use the term Nikkei for the emigrants and their descendants who return to Japan.
- We follow strict ethical journalism practices, which includes presenting unbiased information and citing reliable, attributed resources.
This methodology differs from other indices, such china and russia dump dollar signaling a possible financial alliance as the S&P 500, which are market-capitalization-weighted and consider the size of a company based on its market capitalization rather than its stock price. Buying and managing each individual stock in the Nikkei 225 is costly and impractical, with substantial tax implications. Individual investors can gain exposure through exchange-traded funds (ETFs) whose underlying assets correlate to the Nikkei 225.
Often referred to as the ‘Nikkei Stock Average’ or just the ‘Nikkei’, it consists of the top 225 blue chip companies in Japan listed on the Tokyo Stock Exchange. In addition to monitoring the performance of the Nikkei 225, you must consider exchange rate fluctuations between the yen and the dollar. One of the leading index funds in this respect is the Daiwa Japan Nikkei 225 Index Fund. With an expense technical forex trading strategies ratio of just 0.16%, this particular fund is one of the most competitively priced in the space.
The index represents the history of the Japanese economy following World War II. However, you can gain exposure to this index by buying shares of an ETF that tracks the Nikkei. We have expanded over the years to include newer topics such as blockchain, eCommerce and tech news but have remained true to our original vision and are now trusted by millions of visitors each year. When you purchase an ETF, the process works in a very similar way to that of a conventional equity. The reason for this is that the market value of the Nikkei 225 ETF will rise and fall throughout the day.