Asset Managers & FinTech Companies Registration Guidebook

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0 When an asset manager does business in Japan, the approach (i.e., licenses and products) differs depending on which customer segment is targeted. If you are targeting retail investors, you may set up and manage public “Toshin”, which is the investment trust fund domiciled in Japan. You will consider building a relationship with either distributors that have a strong sales network for retail investors, or major Japanese asset managers that form fund-of-funds to wrap your products. If you are targeting institutional investors, which are financial corporations, you will consider managing private “Toshin” funds. For pension funds, you will approach pension consultants or public pensions who evaluate asset managers. You will manage separate accounts based on discretionary investment agreements, otherwise, you will find a way to provide investment advice. When managing funds domiciled in other countries, you will approach broker-dealers who distribute the funds or have them wrapped in fund-of-funds of Japanese domestic asset managers. Expanding “Toshin” fund market “Toshin” fund is the most common investment vehicle for retail investors. The main distribution channels for retail investors are through one-on-one sales at securities companies and banks. People have easy access to these distributors through the branch network across Japan. Online brokers are also a growing channel for retail sales. “Toshin” funds are widely selected for long-term investment schemes such as NISA and iDeCo. Institutional Investors such as regional banks have also shifted investments from Japanese Government Bond to private “Toshin” funds for higher returns under today's low interest rate environment. According to the figure below, the total assets of “Toshin” funds have increased about 3.2 times from 86 trillion yen in 2011 to 279 trillion yen in 2022. (2) Opportunities in Asset Management Market How to approach asset management market? Changes in Assets of Public & Private Toshin fundsDec2011Dec2012Dec2013Dec2014Public Toshin Funds(Source: The Investment Trusts Association, Japan (JITA)） (in JPY Trillion)Dec2015Dec2016Dec2017Dec2018Private Toshin Funds3002502001501005047403229945764824 869062741111059897Dec2019Dec2020Dec2021Dec202211111010599164169123139