Heart shaped hedges, Japanese gardens (« Johnson’s aeroplane” – INXS, 1984) When it comes to buying Japanese equities for a non-Japanese investor, this emotional question always resurfaces: how do I manage the currency risk for the seeds I sowed in the Japanese garden, i.e. do I hedge the JPY currency…
What is it good for? Nothing! What is Japan’s desperate effort to lower its currency good for? Well when having a look at the chart below the answer is clear: nothing! Japan’s central bank has increased its balance sheet by 20% just for 2016 so far, and the result is pretty…