Japan’s high-frequency trader Dharmacapital moved all its staff to Singapore earlier this month, according to people familiar with the matter, effectively leaving Tokyo with no such firms operating out of the city. The country’s high tax rate compared to other Asian financial hubs, such as Singapore and Hong Kong, was partly behind the decision to relocate, according to one of the people, who asked not to be identified discussing private information. Most peers, including Citadel Securities, Virtu Financial and Jane Street, trade from Singapore or Hong Kong.
Tokyo has struggled to cement its status as a major international financial hub. Comparatively high income tax rates and language barriers are among the factors cited by some finance professionals for choosing other cities over the Japanese capital. Singapore this month unveiled a proposal for tax exemptions for fund managers, as rival Hong Kong sees a resurgence in its fortunes and an influx of returning talent.
Market-making firms accounted for more than 30% of trading value in the Tokyo Stock Exchange since at least 2024, according to a survey by the FSA.
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