NISA General Questions | SBI

[northSaver]

I'm already satisfied with my T.NISA portion, investing in both:
- eMAXIS Slim US stocks (S&P500) 60%
- eMAXIS Slim (All Country) 40%

I'm sure you're aware of this, but this allocation equates to about 80% US stocks and 20% rest of the world. This is because about half of the All Country fund invests in the US. No problem if that's what you're aiming for.

Personally I like to own some stocks in the country I'm living in and might retire in. So I'm currently about 20% Japanese index funds (mostly TOPIX) in the stock part of my portfolio.

Portfolio allocations are a personal matter. I'm not young enough or brave enough to own 100% stocks so I also own bonds, gold, REITs and even a little crypto. For me it's all about finding the optimal balance between risk and reward in terms of historical performance.

[styxomaniac]

I'm sure you're aware of this, but this allocation equates to about 80% US stocks and 20% rest of the world. This is because about half of the All Country fund invests in the US. No problem if that's what you're aiming for.

I remember reading somewhere that a big portion of ‘All Country’ funds are in the US, but I failed to realize it until you pointed it out. Thank you. I guess I'll make some adjustment later on maybe on my Growth NISA investments.

I also own bonds, gold, REITs and even a little crypto.

I plan to incorporate maybe 20%-30% bonds in my portfolio with the remaining invested in stocks, but I know nothing about them yet. Do you have any suggestions on what bonds to purchase so that I can start looking into it? Can bonds be purchased under Growth NISA?

Keeping things simple is valuable too, in terms of reducing the number of decisions you need to make.

Thank you and I agree with you, Ben. I would also like to keep it as simple as possible because I am not brave enough to huge risks

[RetireJapan]

I plan to incorporate maybe 20%-30% bonds in my portfolio with the remaining invested in stocks, but I know nothing about them yet. Do you have any suggestions on what bonds to purchase so that I can start looking into it? Can bonds be purchased under Growth NISA?

The easiest way to own bonds is with a mutual fund or ETF. The eMaxis Slim series of mutual funds has a developed country bond fund and a Japan bond fund. There are many similar funds from different providers too.

[Tkydon]

I also would like to know what is the difference between these 2 custody category

The first one is for your investments in your taxable account and the second one is your NISA holdings. If you have investments in both you can choose which part to sell. Also when you buy, you can choose to hold in taxable account or NISA account.

And in your taxable account on the left, you can either select your Regular - Ippan Account 一般口座, and you will be paid out Gross and be responsible for reporting and paying the taxes yourself,
or select your Tax Withheld at Source - Tokutei Account 特定口座, and you will be paid out Net of Taxes and your broker will be responsible for reporting, withholding, and paying the taxes on your behalf, if you don't want to have to deal with the tax filing yourself.

[styxomaniac]

The easiest way to own bonds is with a mutual fund or ETF. The eMaxis Slim series of mutual funds has a developed country bond fund and a Japan bond fund. There are many similar funds from different providers too.

Thank you for your suggestion. I’ll read more about bonds later on. For now, I’ve invested in both eMaxis Slim TOPIX and eMaxis Slim NIKKEI, which completes my Growth NISA portion. This forum has been really helpful!

T.NISA (85% of ttl invt)

• eMaxis Slim All Country 40%

• eMaxis Slim S&P500 60%

Growth.NISA (15% of ttl invt)

• eMaxis Slim TOPIX 50%

• eMaxis Slim NIKKEI 50%

[Tsumitate Wrestler]

The easiest way to own bonds is with a mutual fund or ETF. The eMaxis Slim series of mutual funds has a developed country bond fund and a Japan bond fund. There are many similar funds from different providers too.

Thank you for your suggestion. I’ll read more about bonds later on. For now, I’ve invested in both eMaxis Slim TOPIX and eMaxis Slim NIKKEI, which completes my Growth NISA portion. This forum has been really helpful!

T.NISA

• eMaxis Slim All Country 40%

• eMaxis Slim S&P500 60%

Growth.NISA

• eMaxis Slim TOPIX 50%

• eMaxis Slim NIKKEI 50%

Just to be clear, I don't think anyone here would recommend that degree of Japanese stocks exposure. Japan represents only 5-6% of the global stock market.

So market weight would only be 180,000-220,00 ish yen of your 3,600,000 Nisa allowance.

[northSaver]

Just to be clear, I don't think anyone here would recommend that degree of Japanese stocks exposure. Japan represents only 5-6% of the global stock market.

I agree that his exposure to Japanese stocks seems excessive. But I also think that 5-6% is... the opposite of excessive! (insufficient?)
The good thing about domestic stocks is the lack of currency risk. I've heard that 20-80% of domestic stocks is considered "normal". Personally I aim for the lower end of that scale, but to each their own.

[Tsumitate Wrestler]

Currency risk is not a concern for longーterm passive investing. Overexposure to a single market presents a more pronounced risk to an investor.

The Japanese equity market is only 5.4% of the global market. OP seems overexposured to a large degree, but we don't know about other possible holdings.

Funds like the MSCI ACWI adjust their holdings quarterly to match market cap, so an investor does not need to worry about rebalancing themselves.

One only has to look back to 1992, to remember the horrors over concentration caused for Japanese equity investors.

[styxomaniac]

Thanks for all your comments. I guess I need to explain my portfolio further.

My T.NISA is much larger than my Growth NISA at the moment because I (will) invest money there monthly. I contribute to my Growth NISA only when I have extra funds. While I plan to add more stocks and bonds to my Growth NISA, currently I am still figuring out how to budget my finances since this is the first month that I can invest in both. I make regular contributions to T.NISA, and whatever money is left for the month goes to Growth NISA.

Currently, my entire investment is approximately 85% in T.NISA (S&P500 & all country) and 15% in Growth NISA (Nikkei and TOPIX).

I am still very new with stock investing so any comments or suggestions is much appreciated.

[Tsumitate Wrestler]

Thanks for all your comments. I guess I need to explain my portfolio further.

Currently, my entire investment is approximately 85% in T.NISA (S&P500 & all country) and 15% in Growth NISA (Nikkei and TOPIX).

I am still very new with stock investing so any comments or suggestions is much appreciated.

Gotcha. Not too extreme, your overweighting American stocks and 3-4x overweighting Japanese stocks.

If you want to see what a market cap weighting looks like click on the facts sheet for or your emaxis slim all country fund, or Google MSCI ACWI and look at the fact sheet.

The easiest and most diversified option is All country I would recommend sticking with only that fund until you feel you understand the basics, and your investing goals.