Economy
Ethical Investors Use Economic Calendars When Buying Japan Securities
Are you passionate about making the world a better place? You should incorporate that principle into your investing strategy. A growing number of people around the world are practicing ethical investing.
Environmental, social and corporate governance (ESG) investing is a booming industry as more people care about helping the planet and the world at large. ESG transactions are now worth over $4 trillion, a figure which will likely keep growing in the future.
The ESG market in Japan is particularly strong. Clifford Chance wrote a great post about the evolution of ethical investing in Japan a couple of months ago.
Despite the growing appeal of ethical investing in the Japanese markets, many investors still have difficulty navigating it. One of the biggest challenges is trying to figure out how to respond to major events in the Japanese markets.
Fortunately, they can resolve these challenges with an economic calendar.
What is an economic calendar?
When making informed investment decisions, having access to accurate and up-to-date economic data is essential. For investors trading in the Japanese markets, an economic calendar is one of the essential resources for this type of information.
An economic calendar lists upcoming critical economic events and data releases, typically detailing the expected impact on financial markets. It can be a precious resource for investors as it allows them to plan their trades around major market-moving events.
Ethical investors can take things a step further when using economic calendars. They can use them to understand major developments pertaining to companies and events that focus on sustainability, human rights and other issues ethical investors are concerned about.
When it comes to evaluating data on economic calendars in Japan as an ethical investor, various methods can be used. In this article, we’ll look at three of the most commonly used methods: historical analysis, correlation analysis, and sentiment analysis.
Historical analysis
Historical analysis is the process of studying past data to make predictions. In the context of economic calendars, this might involve looking at how specific data releases have affected markets in the past and identifying any patterns or trends.
One way to use historical analysis when evaluating economic calendar data is by looking at the performance of certain assets or indexes around specific events. For example, you might compare the performance of the Nikkei 225 Index around the time of a particular data release to get an idea of how the market is likely to react. As an ethical investor, you can also look specifically at ESG indexes. Some of the best ESG indexes in Japan include the Nikkei ESG‑REIT Index and the S&P/JPX Carbon Efficient Index. Ethical investors may want to compare these indexes on their economic calendar.
Another way to use historical analysis is by studying the impact of specific data releases on different markets. For example, you might look at how specific releases have affected the yen’s value or the stock market.
Correlation analysis
Correlation analysis is a technique that measures the strength of the relationship between two variables. In the context of economic calendars, it can be used to determine whether particular data releases are correlated.
One way to use correlation analysis when evaluating economic calendar data is by looking at how certain pairs of assets have reacted around specific events. For example, ethical investors might compare the performance of the S&P/JPX Carbon Efficient Index and the USD/JPY exchange rate around the time of a particular data release. It can help you to understand how the two assets are related.
Another way to use correlation analysis is by looking at how specific data releases have affected the movements of different indexes. For example, you might compare the performance of the Nikkei ESG‑REIT Index and the S&P 500 Index around the time of a particular data release. It can give you an idea of how that particular release has impacted the broader market.
Sentiment analysis
Sentiment analysis is the process of assessing the emotional sentiment surrounding a particular topic or asset. In the context of economic calendars, it can be used to gauge market expectations for upcoming events. This information can help predict how markets might react to specific data releases. You can focus specifically on companies in the solar energy sector if you want to support them as an eco-friendly investor.
One way to use sentiment analysis when evaluating economic calendar data is by looking at the tone of news articles around specific events. It can help you understand how the market feels about that particular release.
Another way to use sentiment analysis is by analyzing social media data around specific events. It can give you a sense of what people expect from the release.
Critical sources of economic calendar data
In Japan, there are a few key sources of economic calendar data. The Ministry of Finance (MOF) publishes a weekly schedule of upcoming events. The Bank of Japan (BOJ) also releases a monthly calendar of events, including information on BOJ meetings and speeches by BOJ officials. Finally, the Japan External Trade Organization (JETRO) publishes a monthly report on upcoming trade data releases.
Each of these sources provides different types of information, so it is important to consult them to get a complete picture of what is happening in the Japanese economy.
Ethical Investors Should Take Advantage of Economic Calendars When Buying Japanese Securities
The ESG market in Japan is growing significantly. However, it can be tricky to make good investing decisions. Various methods can be used to evaluate data on economic calendars in Japan. By using historical analysis, correlation analysis, and sentiment analysis, you can better understand how the market is likely to react to upcoming events. If you would like more information on economic calendars visit Saxo today. This will help you make the most of your ethical investing strategy.