What’s it like working for a hedge fund … in Tokyo? Read on.

Q: Do you speak Japanese? Do you need to?
A: Speaking the local lingo certainly helps although it is a very difficult language to master for a foreigner like myself. Speaking some Japanese certainly helps when ordering drinks or telling the cab driver where you want to go. In Tokyo most streets have no names so it is crucial to be able to describe the way to the taxi driver if you want to make it home after a night in Roppongi.

Q: How would you describe the expat hedge fund community in Tokyo ? Is it kind of like Cheers, where everybody knows your name?
A: Many of the foreigners in the Japanese hedge fund community do know each other. While there are now hundreds of firms involved in the Japanese hedge fund industry it is still a fairly small community and most are involved in the Tokyo Hedge Funds Club.

Q: Is there a consensus in the Japanese hedge fund industry on the recent fund blow ups (Amaranth, etc)?
A: The Amaranth blow-up had very little impact here in Japan . A majority of all Japanese institutions have invested in hedge funds and this number continues to grow. Blow ups in other countries can have a negative impact as some investors become wary of hedge funds in general, but the serious and more sophisticated investors know the game and won’t change their investments because of Amaranth. However, Japanese investors are now paying more attention to risk management.

Q: How developed is the industry compared to the U.S. , in terms of assets, sophistication, appeal…?
A: Nowadays there is quite a developed hedge fund industry in Japan . This is the second biggest economy in the world and there is plenty of money going into hedge funds. The last few years have seen enormous growth in assets under management in hedge fund strategies. Originally Japanese investors opted for funds of hedge funds but as they are becoming more sophisticated they start questioning the extra layers of fees. Thus many have now started to do direct investments with single-strategy managers.

Q: Let’s talk about the social aspects of living and working in Tokyo. What is a common business faux pas that you see foreigners commit, and what are some of the basics people should know about doing business there?
A: Foreigners tend to talk too much. Japanese business people listen rather than talk. The Japanese also don’t like to confront issues or people and thus never say no. This means many naïve foreigners who are sales people think that all their prospects are really going to buy. They won’t. “Very interesting” is Japanese for “Are you kidding me?” and “We will get back to you” means “Get the hell out of my office”. “Maybe” is a big fat “No”. “Yes” means “Maybe – we will monitor this for three years and get back to you”.

Q: What about stereotypes and misconceptions. Can you think of a commonly held belief that is simply not true about Japan or Japanese people, for instance, like how the Japanese still want to take over Asia, or how they dress like surfers?
A: What’s wrong with dressing like a surfer? I am all for it. If it was up to me I would do all my business meetings in an Aloha shirt. The Japanese won’t be interested in taking over Asia again until the Chinese will lower their voices and stop talking too much.
Q: Now to the flip side — what is the strangest custom or thing you have witnessed in Japan?
A: Some curious things, such as whale sushi, people peeling the skin off grapes before eating them and grown-up and men in suits reading cartoon porn on the rush-hour train on the way to work makes you think.
Q: What are the advantages/disadvantages of living in Tokyo versus say, Hong Kong , or another major Asian city?
A: Things work here. Public transport runs as it should – on time. People are polite and considerate. It is a much safer city than other Asian cities. The little crime we have is organized crime controlled by the yakuza (the Japanese mafia) so you won’t notice it. On the other hand, Tokyo is expensive so you’d better be a well-paid banker in order to survive.

Q: I hate myself for asking you this, but did you watch Lost in Translation, did you like it, and does it capture what it’s like to be a foreigner in Tokyo?
A: Sure, all of us felt like that when we first arrived in Tokyo. Tokyo is one of the greatest cities in the world, but it is very different from the US or Europe. Hong Kong and Singapore are easy cities for foreigners to live in as they are English speaking places. In Japan they don’t even speak English at the immigration office.

Q: So do finance expats live like kings there?
A: I don’t think that the lives of finance expats in Tokyo are much different from other major cities. The biggest difference is that we get better sushi for lunch then they do in Chicago or London . And there are still no good ramen noodle shops in New York , are there? And if you fancy some whale sushi for dinner that would not happen in New York .

Q: What’s the best/hottest club there at the moment?
A: Mado Lounge on the 52^nd floor of Roppongi Hills in central Tokyo has a view to kill for. The tiny Brussels bar in Kamiyacho has some great Belgian beers but otherwise all the fun stuff happens behind closed doors at dodgy karaoke bars. For professional and social networking the Tokyo Hedge Funds Club is unrivalled.

Q: What do you miss the most about home?
A: Sarcasm and irony – two concepts that do not exist here in Japan.

Q: What advice would you give to either someone with a few years of experience in finance looking to work in Japan, or college kids who are trying to work abroad in finance in Asia after graduating? For instance, do Japanese firms (or foreign firms with Japanese offices) care about where you went to school?
A: Most Japanese banks only hire graduates from the top four or five Japanese universities. This is also true for many of the Wall Street firms in Tokyo. Foreigners in finance in Tokyo typically studied at Harvard, Princeton, MIT, Cambridge or Oxford. Most Japanese firms simply won’t bother with the trouble of even interviewing foreign candidates at the graduate level so many younger foreigners end up working for Western firms. Older and more experienced candidates may get away with not speaking Japanese if they are specialists or if they are sales people with the right network of potential clients. In all cases an understanding of the Japanese culture and language is certainly helpful.

Q: Arigato gozaimashita.
A: Dou itashimashite.