Young Japanese show no interest in stocks

[TOKYO] History is working against Japan's government as it seeks to convince a new generation of investors that equities are the best bet for funding retirement.

A programme of tax breaks that started on Jan 1 has not proved to be the answer, with less than 9 per cent of investments coming from people under 40. Now, policymakers are looking to tweak the plan. The Financial Services Agency (FSA) will this week recommend increasing the annual amount that can be invested through a Nippon Individual Savings Account (Nisa), according to a source familiar with the matter.

The challenges to any blueprint for encouraging equity investment in Japan start with the market itself, with the Topix index sitting more than 50 per cent below its 1989 high and almost 30 per cent below levels as recently as 2007. Even last year's 51 per cent advance is failing to coax a response because younger people have little money to spare, sceptics including the founder of the Sawakami Fund say. The measure fell 0.5 per cent to 1,285.01 at the close on Tuesday.