So I was positioning the portfolio to have more BTC exposure than stocks, and this past month I’ve decided to keep them equal weight.

And in the process I also added JP stocks into the portfolio so I want to make a post to outline my thought process on that.

Reducing BTC allocation

So BTC has been in a bear market for the past 3-4 months.

Not that “because it’s in a bear so I reduce” (maybe a little?), but this bear market also show me that having too much weight can be really bad for liquidity especially in times of stress.

Meanwhile last time I was deciding to get BTC to this high of a ratio was back in April 2025 with the tariff fiasco, and US stocks dropped just as much if not more than BTC.

I thought hey BTC has no counter-party risks and can even be less volatile than tech stocks in times of stress, and it’s highly correlated to US tech stocks anyways.

But the reality is, in other times tech stocks can actually perform well while BTC really lags, like these past 3-4 months.

Therefore just a tad less BTC exposure is probably good, even if the entire return over 5-10 years might reduce a bit. In fact it might not because I can safely go with higher leverage if I make the adjustments that I am making now.

Increasing stocks allocation + adding JP stocks

If I just added those BTC exposure all back into tech stocks though, then it’s just a repeat of 2025, which isn’t what I had in mind.

Instead, I am rotating the capital to JP stocks.

I dipped my toes into JP stocks in 2024 but quickly pulled out fully.

So why am I getting back into it again?

Well, I guess partially because in the past 3-4 months it demonstrated it can perform really well.

Which is of course bad timing in a sense that I’m rotating from the weakest (BTC) into the strongest (JP stocks).

But despite maybe the bad timing, I really think this is good for the portfolio.

I am not putting it into the N225 – which was what I did in 2024 and it turned out the N225 is highly correlated with the US tech stocks and NDX100 index.

Because N225 consists of many semiconductors stock which is highly cyclical.

On the other hand, the Buffett “shouji” companies turned out to have vastly outperformed the N225, WHILE having lower volatility and lower correlation with US tech.

It’s unfortunate that I didn’t discover it earlier but its not too late I think. I was bullish on the Japanese market in 2024 and the thesis still remain actually.

Japanese stocks are being repriced with better management and higher growth, at least in nominal terms due to inflation. Especially the “shouji” companies is a really good inflation hedge + taking in Japanese growth if it happens.

Expectation for JP stocks

In any case, I don’t expect them to outperform US tech stocks in fact. Over 10 years they probably will underperform.

My view is, Japan is not as innovation and has less growth potential than the US after all.

But it dampens the volatility and allow higher margins.

Also I am adding in some higher growth potential stocks like MHI for the national defense + nuclear energy play.

If I find more high potential Japanese stocks with good themes, I might rotate some shouji stocks over as well.

For now I’ve started positions in 3 shoujis and MHI. Let’s see how it goes and I might readjust down the road.