[Direct from an FP] The “World with Interest Rates” has arrived! 3 anomalies caused by rate hikes and the “win-and-run” strategy for new NISA beginners

Thank you for your hard work today!

I am “Yuyuyuyuyu,” a former bank engineer and parenting financial planner.
Every week, I set a different theme and, from the perspective of an FP and former bank SE, I share mechanisms and know-how centered mainly on household management.

Magazine “Investment Strategy Starting from Zero: The ‘First 10 Million’ Built with New NISA and High-Dividend Stocks”

Basics (Completely Free) *The latter half of this article contains practical paid know-how.

“Recently, the yen has strengthened and my new NISA valuation has dropped sharply…”

“I see news about rate hikes, but what impact does it actually have on my investments?”

Since the recent “rate hike (interest rate increase),” many moms and dads have likely been spending anxious days as their new NISA account balances, which had been growing steadily, have turned negative.

Until now, Japan has been in a “zero interest rate” bonus time (where there is almost no interest even if you borrow money), which is rare in the world.
With the tailwind of a weak yen, it could be said that it was an “easy mode” where assets would grow on their own if you bought US stocks or global stocks.

However, those rules are now about to change significantly.
We are entering a “world with interest rates.”
As an active financial planner and a parent of three, I deeply feel this turning point in the market.

However, there is no need to panic and stop investing or constantly change your strategy. This is because I know the rules of “what happens in the market due to rate hikes.”

In this article, I will take a step further from the previous “basics of rate hikes” to explain the “three phenomena (anomalies) that actually occur due to rate hikes” and “concrete investment strategies for them.”

[What I will share in the free section]
– What are the “three phenomena (anomalies) caused by rate hikes” that strike investors?
– Is easy mode over? The reality of the market from now on

[Value-added content provided in the paid section (main body)]
This article is a practical guide that breaks down the question “So, what should I do in the end?” into concrete strategies you can use starting tomorrow.

– Valuation plummeted due to a strong yen! Changing the “numbers to watch” for core (accumulation) investors
– A change in the lead for the satellite portion (individual stocks)! Shifting funds from “growth” to “value”
– How to identify “hidden debt stocks” that you should never buy during a period of rising interest rates
– “Portfolio maintenance techniques” for market turning points practiced by FPs

A “world with interest rates” is by no means a winter era for investors.
Rather, it is a “time to prepare” where only those who know the right strategy can grab the ticket to the next 10 million yen.
If you want to grow your assets steadily without being swayed by market changes, please be sure to receive the strategies that follow.

The “three phenomena (anomalies)” caused by rate hikes

When Japanese interest rates rise and, conversely, US interest rates begin to fall (rate cuts), the interest rate gap between Japan and the US narrows. This causes the following three phenomena to occur in the market.

Phenomenon 1: A powerful reversal toward a “strong yen”
The movement to sell off high-interest dollars and buy yen, which has begun to see rising interest rates, will intensify. The weak yen, which was at 160 yen to the dollar, will suddenly jump (strengthen) to the 150 yen range.
The contents of the “S&P 500” and “All Country (Global Equity)” popular in new NISA are mostly foreign currency-denominated (dollar-denominated).
Therefore, even if US stock prices themselves do not fall, the valuation on our smartphone screens will decrease just by the yen strengthening.

Phenomenon 2: Stock price decline for “companies that grow by borrowing money”
Rising interest rates mean that the “interest” companies pay when borrowing money increases.
In particular, cutting-edge IT companies and emerging companies (growth stocks) have achieved rapid growth by borrowing large amounts of funds from banks to invest in new businesses. Since rising interest rates squeeze the cash flow of such companies, they are easily disliked by investors, leading to a decline in stock prices.

Phenomenon 3: Headwinds for the real estate market (REITs, etc.)
The real estate industry also borrows large amounts of funds to build buildings and condominiums. If interest rates rise, loan payments increase and profits decrease. Also, if mortgage interest rates rise, the desire of individuals to buy homes will decrease, so strong headwinds will blow against real estate-related stock prices.

Now that the rules have changed, how should you move?

The era of “it’s okay to just buy US stock indices and pick up a few popular high-tech stocks” is on hold for now.
However, please rest assured. Money will not disappear from the market. Money that has fled from high-tech stocks and real estate stocks will simply move to “other places that are resistant to rising interest rates.”

In the paid part from here on, I will explain concrete action plans for a satellite strategy that anticipates this “destination of money” and a core strategy that invalidates the damage of valuation drops due to a strong yen.

*From here on is paid content.