How to Invest in Japan's Internet Trading
Investing in the Japanese stock market online is only possible, ironically enough, if you live in Japan. With Japan's economy making a slow but steady recovery from the post-"bubble" recession, investing in one of the many companies on the Tokyo Stock Exchange may seem like a tempting opportunity, but the Ministry of Finance requires investors to possess a Japanese address to participate. Once you are living in Japan, finding a broker is just a matter of research and overcoming the language barrier.
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Things You'll Need
- Japanese address
- Internet access
- Certificate of alien registration or other proof of legal residence
Instructions
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Establish your residence in Japan. This step is mandatory before you can proceed. Many foreigners accomplish this through a work or study visa that proves your intent to live in the country for a given length of time, at least a few years. Some investors have found a loophole by purchasing through a friend who lives in Japan, or alternately, investing through an international broker. However, these options are less secure and, due to the difference in time zones, often frustrating when real-time prices change as the information travels abroad.
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Choose an online broker. The brokers in Japan aren't used to English-speaking clients and there are no English websites run by a broker, so you must have a working knowledge of the Japanese language to set up an account. Monex Securities is known for its relatively user-friendly interface and simple instructions, and it takes less than a week to set up, so this may be an option if you aren't very confident in your Japanese skills.
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Fill out the online application. As mentioned in the previous step, you won't find one in English, although you can use a translation service such as Babelfish to gain a crude knowledge of what is written on the page. After you fill out the application, within a few days to a week, you'll receive a packet in the mail requesting the necessary documents to set up an account.
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Prove to the broker you reside in Japan with supporting documentation. The requirements each broker has varies, but usually you'll be required to provide a driver's license or passport; non-citizens additionally require a copy of their "gaikokujin toroku shomeisho" (certificate of alien registration card).
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Fund your account. Again, each broker will have its own specific rules, but generally, the application packet will ask you for information about your bank account and give you the opportunity to make a deposit when you return the papers. Once your online account is funded, you can begin trading.
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Tips & Warnings
When you fill out the application, you'll most likely need to decide at that time how you're going to pay taxes on the account. You can choose to either have the broker do it for you, or pay taxes on your own. The former choice frees you from having to figure out all the numbers yourself, but the latter offers more freedom with your money prior to tax day.
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Resources
- Photo Credit japanese yen image by Photosani from Fotolia.com
