At a time when Japanese stocks continue to rise and international capital flows are erratic, Buffett once again sends a signal to look at multi-day stocks.

According to Bloomberg, Buffett's Berkshire Hathaway issuedBaccaratpredictoronline263.3 billion yen (17BaccaratpredictoronlineThis is the first batch of yen bonds issued by overseas issuers after Japan ended negative interest rates in March.

It is reported that the Japanese yen bonds issued by Berkshire have seven issues with maturities ranging from 3 years to 30 years, totaling 263.3 billion yen. Among them, the largest is the three-year yen bond, which raised 169 billion yuan. As an overseas issuer, Berkshire offers a coupon of nearly 1% for three-year yen bonds, much higher than the rate at which Japanese companies sell similar bonds.

Berkshire has issued yen bonds eight times since 2019, making it one of the largest overseas issuers of yen bonds. At the same time, yen bonds are also the most issued by Berkshire, issuing yen bonds twice in 2022 and 2023. Kazuma Ogino, an analyst at Nomura Securities, said Berkshire has issued a large number of yen-denominated bonds in the past, totaling more than 100 billion yen, which is enough to show the attractiveness of the Japanese market.

For this issue of yen bonds, it is speculated that the move is to lock in the current low interest rates of the yen and continue to increase the value of Japanese stocks by borrowing the yen. At the same time, issuing bonds can also avoid the risk of foreign exchange fluctuations and increase the efficiency of the use of funds. Buffett has also said that most of Berkshire's investment in Japanese stocks comes from previously issued yen bonds.

Munger has explained why Buffett issued yen bonds to invest in Japanese stocks: buying high dividend assets at low interest rates. "the interest rate in Japan is 0.5% a year for 10 years. So you can borrow all the money 10 years in advance, you can buy stocks, these stocks have 5% dividend, so there is a lot of cash flow, there is no need to invest. "

When another 263.3 billion yen of debt is issued, there is more concern about which stocks Buffett will invest his money in.

In the last three years, Berkshire has continued to add size to five major trading houses, which can be regarded as one of Buffett's most successful trades, with five stocks more than doubling on average.

In August 2020, Berkshire announced that it had bought about 5% of the shares of five major Japanese companies-Itochu, Marubeni, Mitsubishi, Mitsui and Sumitomo. In June 2023, the holding ratio increased to more than 8.5%. In February 2024, Buffett disclosed in a letter to shareholders that Berkshire already owns about 9% of the five major companies.

Buffett said in the shareholder's letter that diversified business, high dividends, high free cash flow and prudent issuance of new shares are important reasons why he favors the "five major trading houses". Berkshire plans to hold five major businesses for 10 to 20 years, it said. However, Buffett also promised the "big five" that he would not buy more than 9.9% of the shares without the approval of the boards of directors of the five companies.

In addition to the "big five trading houses", Buffett has also said publicly that some Japanese stocks will consider buying when they are undervalued enough. Several Japanese analysts said that undervalued Japanese banks, insurance company stocks or Buffett considered investment targets.

In 2023, the Nikkei index rose 28.2%. Driven by optimism about corporate governance reform and the continued increase in Buffett's weather vane, global money poured into the Japanese stock market. Net foreign capital inflows into the Japanese stock market totaled about 6.3 trillion yen in 2023, including 3.12 trillion yen into cash stocks and 3.17 trillion yen into financial derivatives, breaking the previous net sell-off, according to JPX, the Japanese exchange.

As the Japanese stock market continues to rise, outside money begins to wobble. In the last week of March, foreign investors bought a net 1.18 trillion yen of spot and futures of Japanese stocks, the highest level since the last week of September 2023, according to the Japan Stock Exchange. However, there has been a net inflow of money into Japanese stocks in the two weeks since April, with a total net purchase of 3.5 trillion yen.

Takehiko Masuzawa, head of equity trading at Huili Securities Japan Co., Ltd., believes that Buffett's issuance of yen bonds is good news for Japanese stocks. "it could be a buy signal for the Japanese stock market and could change the trend of the Japanese stock market, which has been selling at a profit."