Buffett’s $24 Billion Japan Bet Pays Off as International Markets Surge
Despite suggestions he was stepping back, Warren Buffett’s investment acumen remains sharply in focus, with a strategic bet on Japanese trading companies yielding a remarkable $24 billion profit in just half a decade. The success underscores a broader trend of international markets outperforming their U.S. counterparts, fueling a reassessment of global investment strategies.
Berkshire Hathaway first announced its foray into Japan in 2020, acquiring stakes of slightly more than 5% in five major Japanese trading companies – known as sogo shosha – for approximately $6.25 billion. The move signaled a long-term commitment, with the possibility of increasing holdings under favorable conditions.
By 2026, that initial investment has more than quadrupled in value, reaching over $30 billion. This substantial gain is attributed to a combination of Buffett’s astute stock selection, undervalued at the time of purchase, and significant policy shifts within Japan. These changes include corporate governance reforms and pro-growth government initiatives that have particularly benefited the technology sector.
The Rise of the Sogo Shosha
Beginning in 2019, Berkshire Hathaway strategically built positions in five prominent Japanese sogo shosha companies. These diversified firms operate across a wide range of industries, including energy and electronics. Buffett further increased these stakes in both 2023 and 2025.
Initially, the investment wasn’t widely perceived as a guaranteed success. Japan’s stock market had experienced nearly three decades of stagnation following the asset market crash of 1989, a period often referred to as the country’s “lost decades.” However, Buffett capitalized on this perceived undervaluation.
A key element of the strategy involved financing the investment with low-cost debt denominated in Japanese yen, at around 1% interest. Simultaneously, the trading companies were distributing dividends of approximately 4%, effectively covering the borrowing costs.
Political and Economic Tailwinds
Political developments further amplified the returns on Buffett’s investment. In recent years, Japan has embraced pro-growth and deregulatory policies, propelling its stock market to record highs. Sanae Takaichi, Japan’s prime minister since October, campaigned on a platform centered around ending “excessive fiscal austerity,” securing a landslide victory and a legislative supermajority in a snap election this month.
Despite a brief technical recession in 2024, triggered by high inflation and weak domestic demand – a risk that has persisted in subsequent years – these concerns have not significantly impacted Buffett’s success. The situation highlights the relative strength of international markets compared to the U.S. In 2025, overseas stock markets surged 28%, exceeding the S&P 500’s 16% gain. The Nikkei, Japan’s benchmark stock market index, significantly outperformed the S&P 500, rising 38.6% over the past year.
A Shift in Global Capital Flows
A weaker dollar, escalating trade tensions, and the concentration of the U.S. technology sector have contributed to increased capital flows abroad over the past year, a trend expected to continue into 2026. While Berkshire Hathaway remains largely invested in U.S. assets, it appears unlikely to divest from its Japanese holdings in the near future.
“It’s worked out very well so far, but we’ll be in these stocks 10, 20 years,” Buffett told CNBC in 2023, underscoring his long-term confidence in the Japanese market. This enduring commitment signals a broader recognition of the potential for significant returns beyond U.S. borders, even for the most steadfastly American investor.
