Editor’s Note: This story has been updated to correctly identify Mitsubishi Corporation as one of Japan's five largest trading houses.
Buffett’s Billion-Dollar Bet Gets Bigger
Buffett's love affair with Japan is nothing new. Back in 2020, Berkshire quietly snapped up 5% stakes in each of these trading giants, shelling out $6 billion. Fast forward to today and those holdings are worth $23.5 billion.
Now, with the 10% ownership cap lifted, Buffett's annual letter made it clear: "You will likely see Berkshire's ownership of all five increase somewhat."
Translation? Buffett's doubling down.
Why Trading Houses? Think Private Equity, Buffett Style
Why does he love these stocks?
Think of them as Japan's private equity powerhouses with portfolios spanning convenience stores, salmon farms, infrastructure and tech startups.
Jefferies analyst Thanh Ha Pham calls them “the private equity of Japan” but with a Buffett-approved long-term horizon.
ETFs, Stocks Riding The Buffett Wave
For ETF investors, Buffett's Japan bet shines a light on three key funds.
The iShares MSCI Japan ETF (NYSE:EWJ) is up 2.64% year-to-date, while JPMorgan's BetaBuilders Japan ETF (NYSE:BBJP) has climbed 2.37%. But the real standout?
The WisdomTree Japan Hedged Equity Fund (NYSE:DXJ), which boasts a 3.98% gain over the past year.
The Buffett effect is real and it's not just the trading houses riding the wave.
With Japan's corporate reforms, rising dividends and Buffett's backing, this might just be the start of a long-term bull run.
For investors, ignoring Japan now could be like skipping Apple Inc (NASDAQ:AAPL) in 2003 – a mistake Buffett himself vowed never to repeat.
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