Neuberger Berman has launched a new fully transparent, actively managed ETF that offers exposure to high-quality Japanese equities across all market capitalizations.
Neuberger Berman notes that the ETF serves as a means to capitalize on the potential new growth cycle in the Japanese economy.
The Neuberger Berman Japan Equity ETF (NBJP US) has been listed on NYSE Arca with an expense ratio of 0.50%.
According to Neuberger Berman, Japan’s economic growth is currently supported by several key drivers. Strong wage increases are boosting consumer spending, which is a critical component of domestic demand. Furthermore, this consumption growth is occurring in an environment of moderate and stable inflation, providing a healthy backdrop for continued economic expansion.
Additionally, the Bank of Japan’s phased approach to monetary policy is carefully managing interest rates and liquidity, helping to sustain economic stability. Both institutional and retail investors are increasingly optimistic, which is driving more capital into Japanese equities, further supporting market growth.
Investment approach
The Neuberger Berman Japan Equity ETF seeks long-term capital growth by investing in Japanese companies using a three-step investment process.
Firstly, the portfolio managers conduct quantitative screening, focusing on financial metrics like ROE and EBITDA margins to identify companies trading below their intrinsic value.
Secondly, they perform a qualitative business analysis, evaluating factors such as management quality, industry trends, and competitive positioning.
Finally, the managers assess the strategic valuation of these companies, adding those with attractive investment opportunities to a “Watch List” for further consideration.
The ETF seeks to construct a diversified portfolio across various sectors, selecting securities from the Watch List based on their potential for long-term sustainable growth. The fund also integrates ESG factors into its analysis, considering how issues faced by a firm might impact its long-term financial performance.
Neuberger Berman has significantly expanded its active ETF platform since debuting its first product in April 2022. The firm now offers 12 funds, covering a range of asset classes including equities, fixed income, real assets, and liquid alternatives.