Why Japanese Yen Strong        s1170225
Introduction●   Japanese is the official currency of Japan.●   In the 19th century silver Spanish dollar coins    were com...
Japanese circulating●   ¥1 1oo% aluminium●   ¥5 60-70% copper 30-40% zinc●   ¥10 95% copper 3-4% zinc 1-2% tin●   ¥50 Cupr...
How to trade Japanese Yen●   Japanese Yen is currently trading at 15 year low    levels.●   A strong yen hurts Japan which...
Trade Cash Flow●   Japan has a trade surplus and is exporting    more importing●   The strengthening currency could lower ...
Investment Cash Flow●   There seems to be a strong demand from non-    Japanese assets, especially short-term money    mar...
Demand for Japanese Assets●   Party this could come from foreign reserves    diversification. Think about China for exampl...
Trade Example●   If I decide to buy Oct YUK calls, it was trading    for $1.06, when YUK closed at $83.7●   Maximum risk i...
Summary●   Repeating what we said above: the cause for    the strengthening of the Yen is that the Yen is a    that the Ye...
Reference●   http://www.stocktrendinvesting.com/blog/why-japanese-yen-so-strong●   http://en.wikipedia.org/wiki/Japanese_y...
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Week10 pre

  1. 1. Why Japanese Yen Strong s1170225
  2. 2. Introduction● Japanese is the official currency of Japan.● In the 19th century silver Spanish dollar coins were common South east Asia, the China coast, and Japan.● The spelling and pronunciation “yen” is standard in English.
  3. 3. Japanese circulating● ¥1 1oo% aluminium● ¥5 60-70% copper 30-40% zinc● ¥10 95% copper 3-4% zinc 1-2% tin● ¥50 Cupronickel 75% copper 25%nickel● ¥100 Cupronickel 75% copper 25%nickel● ¥500 72% copper 20% zinc 8% nickel● ¥1000,¥2000,¥5000,¥10000 paper coins
  4. 4. How to trade Japanese Yen● Japanese Yen is currently trading at 15 year low levels.● A strong yen hurts Japan which is a export driven economy.● US dollar is also attributed to Japanese govt not doing enough to stop to the rise.
  5. 5. Trade Cash Flow● Japan has a trade surplus and is exporting more importing● The strengthening currency could lower exports and increase imports in the long run.● This weakens the U.S. Currency.
  6. 6. Investment Cash Flow● There seems to be a strong demand from non- Japanese assets, especially short-term money market instruments.● The demand for assets outside Japan has definitely not been very strong recetly
  7. 7. Demand for Japanese Assets● Party this could come from foreign reserves diversification. Think about China for example who wants to be less depended on the U.S. Dollar or Euro.● Dollars will be printed than that there will be new Yen printed, will strengthen the Yen.
  8. 8. Trade Example● If I decide to buy Oct YUK calls, it was trading for $1.06, when YUK closed at $83.7● Maximum risk is only $106 and no matter how low USDJPY pair go.● However, if USDJPY rises to even ~86.5 in the next 30 days.
  9. 9. Summary● Repeating what we said above: the cause for the strengthening of the Yen is that the Yen is a that the Yen is a currency with net follows: more Yen are bought then that there are Yen sold.● In an historic perspective, the strengthening of the Yen is nothing new and not unexpected.
  10. 10. Reference● http://www.stocktrendinvesting.com/blog/why-japanese-yen-so-strong● http://en.wikipedia.org/wiki/Japanese_yen● http://www.optionpundit.net/trade-ideas/how-to-trade-japanese-yen-via-options

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