Key Points
The WisdomTree Japan Hedged Equity Fund provides exposure to all five of the Japanese financial services firms in which Berkshire Hathaway owns shares.
Buffett, famed for his value investing approach, looked at these companies' balance sheets and came away stunned at how cheap their stocks were.
Newby investors may be apt to think that Warren Buffett investments are limited to the U.S. After all, the "Oracle of Omaha" often said over the course of his storied decades-long career, "Never bet against America."
Plus, some of Berkshire Hathaway's(NYSE: BRKA)(NYSE: BRKB) "forever" holdings are deeply ingrained in American culture, including American Express and Coca-Cola, among others. That doesn't mean Buffett confined his search for value stocks to the U.S.
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This ETF is home to shares of six stocks owned by Berkshire Hathaway. Image source: Getty Images.
Late in his career, Berkshire invested in some Japanese equities, which brings us to the WisdomTree Japan Hedged Equity Fund(NYSEMKT: DXJ). No, the conglomerate previously steered by Buffett doesn't directly own this exchange-traded fund (ETF). Still, the nearly 20-year-old $6.23 billion fund is an effective tool for investors seeking exposure to Berkshire's Japanese holdings.
What happened, what's happening now
First, a quick history lesson. In 2020, Berkshire Hathaway initiated stakes in five Japanese trading houses, also known as "sogo shosha." Those companies are Mitsubishi, Mitsui, Itochu, Marubeni, and Sumitomo. Four of those five are top-15 holdings in the WisdomTree ETF, with Marubeni as the outlier.
In true Buffett fashion, he found value in those Japanese financial companies. Berkshire's original stake across the quintet was $6.3 billion. While there were additions along the way, those positions were worth more than $31 billion in the fourth quarter, confirming Buffett's magic touch travels well.
Fast-forward to 2026, and Berkshire still holds those stocks, and it's expanding its Japanese investments. Now under the stewardship of CEO Greg Abel, Berkshire recently took a 2.5% stake in marine insurer Tokio Marine(OTC: TKOMY), initially valued at $1.8 billion. It's worth significantly more today because the stock surged on the news of Berkshire's investment.
That's music to the ears of investors holding the WisdomTree ETF because Tokio Marine is the fund's fourth-largest holding, and that's noteworthy because Berkshire is likely to be involved with this stock for the long haul. It could eventually own up to 9.9% of the company. Combined, Berkshire's Japanese holdings represent approximately 12% of this Japan ETF's roster, confirming it's a viable tool for "being like Buffett," but in Japan, not the U.S.
DXJ embodies the Buffett style
Buffett is perhaps the greatest value investor of all time, and value is exactly what he found in Japan. Regarding Berkshire's initial buys in Japan, he once said that all he did was look at the companies' balance sheets and came away stunned at how cheap the stocks were.
Investors worried that they missed the value boat with the WisdomTree Japan ETF don't need to fret. Over the past 15 years, members of the MSCI Japan index, of which plenty reside in the Japan ETF being discussed here, delivered earnings-per-share growth well in excess of other developed markets, including the U.S. Making that scenario all the more appealing is that valuations on Japanese stocks remained subdued over that period.
Cementing the case for this Japan fund as an ETF to buy is Japan's increasing embrace of shareholder rewards, something Buffett often looked for when considering new investments. Last year, buybacks in the Land of the Rising Sun notched new records while dividends continued a multi-year growth spurt.
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American Express is an advertising partner of Motley Fool Money. Todd Shriber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.
