Japanese Flocking to Monthly Income Mutual Funds

Japanese investors are increasingly flocking to mutual funds that pay out monthly incomes or dividends, with such funds now accounting for 55.7% of all of the nation’s assets in funds, or $303 billion, Nikkei newswire reports.

For the year, assets in income-producing mutual funds are up 3%, whereas all types of open-ended investment trusts are down 6%.

Japanese investors are taking particular note of monthly payout funds with exposure to foreign fixed income, as they perceive them to be low-risk.

The most popular income-producing mutual fund in Japan is Kokusai Asset Management’s Global Sovereign Open Fund, which took in an additional $3 billion in assets under management year-to-date through July. The second most popular such fund is Daiwa Asset Management’s World Bond Fund, whose assets have swelled by $2.4 billion year-to-date.