In a recent discussion about index performance, financial expert Takashi Raidou addressed the rising concerns of investors regarding the traditional investment strategy of relying solely on global indexes. Amid ongoing geopolitical tensions, such as the situation in Iran, and the effects of the AI bubble in the U.S. market, many investors are reconsidering their reliance on the All Country World Index (ACWI).
Performance Analysis: Comparing TOPIX and Nikkei Against S&P 500
Since the introduction of the new NISA in Japan, many investors have been focused on the performance of various indexes, notably the Nikkei average and the TOPIX compared to the S&P 500. Notably, recent trends indicate a shift in prioritization away from just the ACWI.
The Current Market Landscape
As of early 2026, the Nikkei has reached its highest levels in history, fluctuating significantly in response to global events. Despite the popularity of the ACWI, Raidou pointed out that the Nikkei has outperformed it since the new NISA’s inception.
- Key Index Performances:
- Nikkei 225: Highest performing index since new NISA was introduced.
- TOPIX: Displayed strong performance but not as prominent as the Nikkei.
- ACWI: Not the top performer despite its widespread use.
- S&P 500: Experienced volatility amid AI bubble concerns.
- Risk Assessment:
- ACWI shows lower annual volatility compared to the Nikkei.
- Risk-adjusted returns favor the Nikkei when considering the investment horizon.
Long-Term Investment Perspectives
An analysis covering three, five, and ten-year time frames reveals that the highest total returns belong to the Nikkei. Although the ACWI and S&P 500 have shown considerable returns, especially over five years, these are influenced by currency fluctuations.
| Investment Horizon | Nikkei | TOPIX | ACWI | S&P 500 |
|---|---|---|---|---|
| 3 Years | High | Moderate | Moderate | Volatile |
| 5 Years | Moderate | Low | High (due to yen depreciation) | High |
| 10 Years | High | Moderate | Moderate | Volatile |
In conclusion, while many investors gravitate toward global indices like the ACWI, the performance of Japanese indexes, particularly the Nikkei, highlights the importance of evaluating investments based on risk, performance, and the current market context. For those looking for stability and growth without significant currency risk, focusing on Japanese equities may prove beneficial.
