Daiwa Securities Group Inc.

Daiwa Securities is Japan's second-largest broker-dealer and one of the cleaner ways to hold the Japanese-markets reflation trade. The share price has run with the story — up two-thirds over the last year — as trading volumes, brokerage commissions and wealth-management fees all responded to the Nikkei's own move.

• The just-reported Q1 print landed a modest EPS beat and revenue advanced again sequentially — the fourth straight sequential lift — with underlying trading and asset-management fees both compounding, which is exactly the mix you want if you think the reflation persists.
• At roughly 12x trailing earnings the stock isn't cheap for a Japanese broker but it isn't demanding either — the setup gets more expensive only if reflation stalls, in which case broker earnings give back fast because they gear directly to daily volumes and net-new-money flows.
• The stock trades at the 87th percentile of its 52-week range and roughly 19% above its 200-day moving average — the tape has already priced most of the good news, and further upside now depends on either a BOJ-tightening scare not materializing or corporate-Japan buyback flows accelerating from here.

The compounder-of-Japan-reflation read still works while trading volumes and household equity allocations keep rising. Watch the November print for whether wealth-management inflows keep pace with market appreciation, and any BOJ tightening beyond consensus would compress the multiple quickly.