18 Trillion Yen Goes Poof ¥

18 Trillion Yen Goes Poof

It’s been a rough few quarters. If you missed the five best trading days of the year, you’d still be down 30%. The good news is that at least none of us poured 18-trillion-yen down the drain. We all outperformed the Japanese government, investing the world’s largest pension pot.

The aging retirees of Japan best not look at their Roth-equivalents after state officials took active stock-picking into their own hands. The government went in big on domestic and overseas stocks, all battered by the virus, and domestic bonds that have lagged.

We can learn from this. The brains behind the world’s largest pension fund got adventurous with critical money and then considered different asset classes as separated into different mental accounts. As mental accounts, allocations shrunk and grew with all kinds of perverse and financially draining biases, risky and safe bets lumped in together.

The takeaway; don’t pretend some emergency funds are more important than others; try not to consider your investments separated in high-security vaults, immune from bias, transferable only using an elite team of undercover, genetically-modified apes.

The other lesson here is that no matter what the prestige of your resume, education, or past returns, no one’s bigger than the market. If Japan’s high-ranking investment officials Eiji Ueda and Naoki Fujiwara competed in the Invstr Raw Fantasy League last month, they’d have rocked up adrift lower than 600,000 places down in the leaderboards.

The pension fund has changed its allocation to stocks and bonds, foreign and domestic, with a quarter of a reformed pot invested in each. The ranges those allocations can deviate before a rebalancing have also been reined in. We’ll see how this affects fortunes!

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

Share:
More Posts
OPEC’s Decision 🛢

OPEC leaders just hosted an important late-November meeting that may signal a change in strategy.

Get your daily Invstr Crunch

Get the market news and updates you need, delivered to your inbox or available on our daily podcast.

Risk Disclosure:

Invstr is not a bank and banking services are provided by Vast Bank, N.A.

Brokerage and Banking services are currently only available to U.S. residents.

Invstr app and web services are provided by Invstr Ltd. Advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC) details of which can be obtained here. Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value.

Investing involves risk and can lead to losses. Past performance does not guarantee future results.

Invstr app and web services are provided by Invstr Ltd. Invstr+ advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC). Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value. Vast Bank N.A. a nationally chartered bank and member of the FDIC, provides the banking products, including the products and services related to digital asset accounts. As with any asset, the value of Digital assets can go up or down and there can be a substantial risk that you lose money buying or holding digital assets. You should carefully consider whether trading or holding Digital assets is suitable for you in light of your financial condition. Your digital account does not support wallet to wallet transferring of your digital assets (i.e. cryptocurrencies) outside the platform. Any Digital Assets in your digital asset account are not insured by any government entities, including but not limited to FDIC or SIPC. The Invstr Visa® Debit Card is issued by Vast Bank, N.A. pursuant to a license from Visa U.S.A Inc and may be used everywhere Visa debit cards are accepted. Invstr Ltd, Invstr Financial LLC and Invstr Securities Ltd are subsidiaries of Marketspringpad Holdings (collectively “Invstr”) and Invstr is solely responsible for the application services and website content.

Watchlists provided when users first access the service are not a recommendation to invest. Instead they are provided to help users better navigate the service. Users are free to edit and create their own watchlists. From time to time, Invstr will suggest instruments solely based on an individual’s interest and the interest levels of the Invstr community. The statistical and portfolio builder models generated by Invstr do not reflect actual investment results and are not guarantees of future results. Comments provided by Invstr leaders, influencers or members of the Invstr Community are not recommendations and should not be construed as such. Invstr does not endorse the content or the positions posted by them. Their investment approach, and that of the models provided by Invstr, may be different from yours and may not be appropriate for you.