Invest in Japanese Yen

Table of Contents 2007’s Top 10 Investments Under $25,000 1. Invest in a single family or multi-family property 2. Invest in gold and silver 3. Invest in foreclosure …

Table of Contents
2007’s Top 10 Investments Under $25,000
1.Invest in a single family or multi-family property
2.Invest in gold and silver
3.Invest in foreclosure properties
4.Invest in mobile homes
5.Invest in fractional ownership of timber
6.Invest in loans
7.Invest with partners on larger projects
8.Invest in Japanese yen
9.Invest in a business or franchise
10.Invest in vacant land (domestic or foreign)

#8 Investment Under $25,000 for 2007

Investing in the carry trade has become very popular in recent years, with foreign exchange investors borrowing money in low-interest Japanese yen and investing it in currencies that bear higher interest. Although it is difficult to determine how much money is tied up in that carry trade, some estimates put the number in the trillions.

With so many investors using this strategy, the carry trade will almost certainly have to eventually collapse and reverse, with currencies returning to a more balanced state. In that event, the yen stands to increase dramatically. Experts have long been predicting that the yen’s value will rise and that the Japanese government will be unable to artificially hold down its value for much longer.

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The yen carry trade is “a tsunami in the making” and several hundred billion dollars of positions in the carry trade stand to be unwound, according to Money Week. The carry trade already appears to be starting a trend of unwinding, as the yen’s value has recently begun to rise, but it likely has a long way to go before the value of the yen reaches a balanced state. Those who believe the yen’s value will rise can put money in yen now, awaiting the widely-predicted rise in its value.

Of course, currency trading offers extensive leverage—up to 400 to one. Investors purchasing yen should be careful to limit their leverage to a manageable level in order to ride out any short-term fluctuations.

Where to find investments:

Those who want to invest in the foreign exchange market, also known as the forex or FX market, have a wide variety of retail dealers to choose from. OANDA and CMS Forex are among the many retail brokers offering online services for foreign exchange investing. Investors with futures accounts may also automatically have access to the forex market.

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