TSE Foreign Stock Market
Tokyo Stock Exchange (TSE) has been proactively engaged in market operations of foreign stocks since it established a foreign stock market in 1973. In particular, TSE has improved the listing system and rules in order to attract high growth companies in Asia and to promote the listing of such companies. TSE has been actively making efforts to establish a firm and unrivaled position as the region’s leading exchange, which grows with the development of Asian economy.
Foreign companies listed on TSE consist of two categories: “Blue Chip” companies set up and listed in their home countries such as the U.S., and foreign companies listed only on TSE.
The trading rules of foreign stocks at TSE are basically the same as those applied to the trading of Japanese stocks: they can be traded in Japanese yen and the trading on margin is possible according to the same criteria for Japanese stocks. Investors and market participants with experience trading in the Japanese market will find trading foreign stocks on TSE rather familiar.
Note that foreign companies have the option of listing their shares on TSE via the JDR scheme.
For details, please refer to the following page.
Why are foreign stocks so attractive to investors?
First, you can invest in leading “Blue Chip” companies in the world.
In addition to leading “Blue Chip” companies in manufacturing, financial sectors, you can invest in high growth companies in emerging economies of North America and Asia.
By investing in these foreign stocks, you can diversify and improve your investment portfolio.
You can engage in internationally diversified investment by composing your portfolio to reflect trends in stock prices, real economies, and foreign exchange markets of various countries.
You can invest in high-yielding stocks of the world.
In general, global “Blue Chip” companies offer investors higher dividend yields than Japanese issuers.
What is the merit of trading foreign stocks on TSE?
- On TSE, listed foreign stocks are tradable under the same system and rules as Japanese stocks. For example, stock prices are available on a real-time basis; orders can be placed in the same way; and the daily price limits (the parameters within which prices may fluctuate) are the same. Foreign stocks can be traded on margin as far as they meet the same criteria as Japanese ones.
- As foreign stocks can be traded in Japanese yen, it is unnecessary to think about currency exchange. Naturally, you don’t have to pay foreign exchange charges to banks.
- You can find stock price information in daily newspapers.
- You can invest in foreign stocks listed on TSE with a relatively small amount of principal, such as JPY 100,000.
- As they are traded on TSE, investors have only to pay trading fees to the Japanese broker you have a trading account with. In other words, you can avoid paying additional fees for placing orders to brokers in issuer’s home country.
- Disclosure materials such as quarterly reports, annual reports, and other important information on issuers are available in Japanese.
Please read more about foreign stocks listed on TSE on the following sites:
- You can search information such as basic corporate information, stock price information, and quarterly earnings results. Please search by selecting the market or section where the issue you want to know about is listed.
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