Preqin's new report on alternative asset investors in Japan finds that when the 
Bank of Japan adopted negative interest rates in 2016, it led many investors to 
seek more diversification and higher yields by investing in alternative assets. 
In 2019, two-thirds of Japan-based investors now allocate to at least one 
alternative asset class. Investors are primarily focused on local investments 
in private capital, with the largest proportions targeting the Far East. But 
increasingly, Japan-based investors are also seeking to allocate to other 
regions in search of diversification. Investors are also more favourable toward 
strategies higher up the risk/return curve, indicating that they are looking to 
alternatives to provide yield, not simply protect capital.

See the full report here:
https://docs.preqin.com/reports/Preqin-Investor-Outlook-Alternatives-in-Japan-June-2019.pdf 


Jie Sin Chia, Head of Asia Products:

"A persistent low-interest environment set by the central bank, as well as 
stagnant growth in recent years, have put enormous pressure on Japan-based 
investors as they look to meet their returns targets. Alternative assets' 
ability to offer diversification and long-term yield have brought them to the 
forefront of investors' minds. While they are looking for opportunities to 
allocate to the rest of Asia, North America and Europe, investors remain 
primarily focused on domestic opportunities. We might see this change if the 
low-interest and slow-growth environment remains in place."

Key Facts:

There are currently 303 Japan-based investors active in alternative assets, 
second only to China (450) within Asia-Pacific. 
Of these, 66% invest in at least one alternative asset class. The largest 
proportion (58%) allocates to private equity, while the lowest proportion (34%) 
invests in hedge funds. 
The Far East remains the most sought-after investment destination for private 
capital investors. 
However, significant proportions of investors also look to allocate to funds in 
North America and the rest of Asia-Pacific. 
Ninety-six percent of private equity investors intend to make fresh investments 
in the coming year, compared to just 54% of hedge fund and private debt 
investors, and 41% of natural resources investors.
Preqin is the home of alternative assets, providing industry-leading 
intelligence on the market and cutting-edge tools to support participants at 
every stage of the investment cycle. More than 80,000 industry participants in 
over 90 countries rely on Preqin as their indispensable source of data, 
solutions and insights.

For more information, contact our dedicated press team at asiapress@preqin.com.

Source: Preqin