Buy Japan

Two fund recommendations to take advantage of the world’s most-hated asset class.

First is the iShares MSCI Japan Index Fund (NYSE:EWJ). It mirrors the performance of the MSCI Japan Index, a very broad swath of Japan’s largest companies. And it gives you a good shot at outperforming the benchmark Nikkei 225 Index. On both a one-year and a five-year basis, EWJ has beaten the Nikkei.

But don’t limit yourself to the blue chips. In almost every market turnaround, small-cap companies lead the way. So pick up the Fidelity Japan Smaller Companies Fund (FJSCX) as a supplement. This fund outperformed the MSCI Japan Index during the post-rebound in 2009. And it might do so again when Japan really starts to rebuild. Plus, you’ll gain exposure to many companies in this fund that you won’t find in EWJ.

Remember, this is the Trade of the Decade. Not the Trade of the Week (http://dailyreckoning.com/buy-japan/)