From: Tazia Smith

From: Tazia Smith To: jeevacation(kgmail.com Cc: , Paul Morris < Subject: Japanese Equity Basket... [C] Date: Wed, 18 Dec 2013 19:31:51 +0000 Inline-Images: unnamed; unnamed(]); unnamed(2) >, Vahe Stepanian Classification: Confidential Jeffrey - Now that the FOMC decision is behind us (with the S10bn taper we just talked about), here is the basket of single-name Japanese equities that we put together to build on your bullish view (presently in DXJ). To incorporate your bearish yen view, we could quanto this basket like we talked about...in note form, we priced 13mos with liSBC, comes to a 95% participation eg. if the basket was up 18%, note would be up 17.1%; if basket is down 10%, note is down 9.5%. max loss 95% of principal (indicative levels only, subject to market movement, as of 12/18/13). We can look to add to your yen short position opportunistically as an alpha overlay (USDJPY now at 103.40). Let us know your thoughts, Tazia Sector Company Ticker Current Price DB Price Target % Auto Toyota 7203 JP Equity 6180 8000 29% Retail Rukaten 4755 JP Equity 1496 1710 14% Finance Resona 8308 JP Equity 506 650 28% Consumer Electronics Panasonic 6752 JP Equity 1158 1300 12% Automation Equipment 0mron* 6645 JP Equity 4105 4426 8% Shipping Kawasaki Kisen 9107JP Equity 236 280 19% Average implied up/downside: 18% Not covered by DB. Price target reflects Bloomberg Average target. Indicative levels, subject to market movement. Source: Bloomberg and DB Global Markets Research 12/16/13. Supplemental Information: DB Research ex ects Ja •anese e • uities could double b 2015 • Abenomics will lead to higher operational leverage and an improved domestic economy • BoJ will ease further as needed; DB expects USD/JPY FX to reach 120 by 2015 • Strong macroeconomic data and increase in overseas asset purchases by the Japanese • GPIF panel report (a third arrow initiative) strongly positive for Japanese risk assets http://www.cas.go.jp/jp/seisaku/koutekisikin unyourisk/pdf/e final report.pdf Yen weakening will likely continue to be a theme, benefiting exporters. EFTA01140901 Toyota: 7203 JP Buy Current price 6170 Target price (11rn) 8000 Upside 29% Panasonic (6752 JP Buy Current price 1158 Target price (12m) 1300 Upside 12% Omron 6645 JP Not rated at DB Current price 4105 Target price (12m) 4426 (Bloomberg avg. Not covered by DB) Upside 8% Kawasaki Kisen: 9107 JP Buy Current price 236 Target price (12m) 280 Upside 18% Reflation is the other major theme, which should be positive for retailers and banks, where DB Research is bullish Rakuten and Resona respectively. Rakuten: 4755 JP Buy Current price 1531 Target price (12m) 1710 Upside 12% Resona: 8308 JP Buy Current price 512 Target price (12m) 650 Upside 27% Tazia Smith Director I Key Client Partners - US Deutsche Bank Securities Inc Deutsche Asset & Wealth Management 345 Park Avenue. 26th Floor Maw Vnrk NY 10 EFTA01140902 This communication may contain confidential and/or privileged information. If you are not the intended recipient (or have received this communication in error) please notify the sender immediately and destroy this communication. Any unauthorized copying, disclosure or distribution of the material in this communication is strictly forbidden. Deutsche Bank does not render legal or tax advice, and the information contained in this communication should not be regarded as such. EFTA01140903