Nomura Asset eyes increasing toushin investment

TOKYO (Reuters) - Japanese retail investors look set to continue their love affair with investment trust funds, which may eventually account for 10 percent of their assets, more than double current levels, Nomura Asset Management said on Tuesday.

Seeking to increase their nest eggs amid very low interest rates, Japanese individuals have been keen to gain exposure to foreign instruments through investment trusts or toushin as they are known as in Japan.

Japanese retail investors have been net buyers of toushin for 14 straight months despite global market turmoil including the Lehman shock that has knocked the value of their investments about.

Of the 1,500 trillion yen ($16.8 trillion) in personal savings held by Japanese individuals, about 60 trillion yen, or 4 percent, have been tapped for toushin, Kazutoshi Inano, chairman of Nomura Asset, the nation's top money managing firm, told the Reuters Japan Investment Summit on Tuesday.

"It would not be surprising if toushin eventually makes up 10 percent of retail investments," he said.

"Preparing for retirement in an environment of extremely low interest rates and an aging population is a common theme for many investors amid doubts toward the country's social security system."

Nomura Asset, which managed a total of about 22 trillion yen ($246 billion) of assets at the end of March, has dominated the toushin market, attracting investors with toushin that invest in emerging markets such as Brazil as well as themed-funds such as its global auto equities funds.

Inano also said Nomura Asset wants to establish a strong presence in Asia to tap investor demand for higher yielding assets as Japan's economy wanes while other Asian economies grow.

"Expectations toward Japan and its economy are ebbing. Retail investor money has been heading toward emerging markets, rather than industrialized countries like Japan which doesn't appear to have fully recovered from the recent credit crunch," he said.

Nomura Asset now bases its equity chief investment officer in Singapore, underscoring its emphasis on Asia.

But Inano also there are still many individual Japanese companies which are globally competitive with high growth potential.

"We believe that vehicles investing in domestic stocks can achieve high returns," he added.

(Additional reporting by Chikafumi Hodo; Editing by Edwina Gibbs)