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Vanguard FTSE Developed All Cap ex North America Index ETF (VIU $45.31)
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Japan Smaller Capitalization Fund Inc (JOF $11.40)
Q: This fund has done well over the last few years but historical really up and down. It shows a 9% dividend -is that correct? Could you let me know how high risk it is, and if you would recommend it as part of a basket of international ETF's? Is there others you prefer that you think would do better over the next few years and any in Canadian dollars? Currently I only own ZDI.
Thank you!
Thank you!
5i Research Answer:
JOF is a closed end fund focusing on Japanese small cap stocks. We do not have a Canadian-traded equivalent. It trades at an 11% discount to NAV. 5-year annualized is 10.26% but one year is 58.50%. Indicated yield is 9.34% but note it only started repaying dividends in July 2025. It has had several long prior periods with no dividends. We would not count on this level to be sustained. In terms of risk, it is high. We have Japan stocks, small caps and currency risk. The fund lost 17% in 2022, 6% in 2021, and 15% in 2018. We like small caps in general, but it is a highly specific regional/sector fund. We think it is OK for that purpose, however. For general, safer, international exposure we would continue to suggest VIU.