Most international-stock funds have long gone light on Japan, whose economy has been beset for years by problems including a strong currency that has weighed on exports, a fast-aging population and massive government debt. But now some fund managers say they are finding some attractive bargains among Japanese stocks.

The average fund in Morningstar Inc.'s world-stock category recently had 7.6% of its portfolio in Japanese shares, below the benchmark MSCI World Index's 9.1% exposure to Japan at the end of March. Funds focusing on non-U.S. stocks had an average of 15% of their assets in Japan, compared with a 21.6% weighting for Japanese stocks in the MSCI EAFE Index of developed overseas markets.

But some individual global and foreign-stock funds, particularly those with a bargain-hunting "value" orientation, have stakes in Japanese shares that range up to about 40% of fund assets.

"We are not investing in Japan but in companies domiciled in Japan," says Rob Taylor, a co-manager of the Oakmark Global fund, with a 21.6% stake in Japanese stocks as of the end of last year, and Oakmark International, with a 20.5% stake. In Japan, he says, investors can find "beautiful businesses at dirt-cheap prices" despite the gloom that has long surrounded the country's economy.