What is a yen carry trade? - MoneyWeek Investment Tutorials

In investment circles the 'yen carry trade' has been gathering popularity in response to Japans crises. Tim Bennett explains what a yen carry trade is and why its proving so popular in this timely educational video. Don't miss out on Tim Bennett's video tutorials -- get the latest video sent straight to your inbox each week, before it's released on YouTube: http://bit.ly/TimBSubscribe To receive Tim's 50 FREE MoneyWeek Basics emails: http://bit.ly/mwk-basics Watch over 100 of Tim's videos for free: http://MoneyWeek.com/tutorials Or download them to your mobile device: http://bit.ly/TimBpodcast For the most important financial stories and how to profit from them: http://MoneyWeek.com http://Facebook.com/pages/MoneyWeek/110326662354766 http://Twitter.com/moneyweek Video series by CFA UK Highly Commended journalist Tim Bennett. http://twitter.com/TimMoneyweek

Comments

1. Is this what is happening right now??
2. Thank you very much, Tim! I finally understood what a carry trade is. I subscribe to what Hungtington said :)
3. really helpful thank you!
4. If  a hedge fund had to go into the market to buy more yen to cover a margin call wouldn't that perpetuate the problem (buying more yen creates more demand) by further increasing the value of the yen?
5. Thank you. Understand you better than my teacher :D
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8. I may be rather naive and uninformed, but would it not be possible to hedge the risk of a strong Yen, with an options (or even futures) contract? Please let me know!
9. Thank you, Tim. Great job explaining this, very helpful!
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11. @Jdjohnjd If the yen gets high Japanese products get expensive for export. Exports goes down, trade surplus goes down. Result japanese corporations will move manufacturing to other countries. Japan gets hollowed out. Possibly more unemployment the younger generation is already having a tough time finding employment. Domestically Japan is in a deflationary situation less yen asked for same goods just to stimulate domestic spending i.e. discounts and sales.