A while back I sold the Invesco Currency Shares Japanese Yen ETF (FXY) out of my Perfect Five ETF Portfolio because I was looking for more diversification in that limited five ETF portfolio. (I replaced it with the iShares Large Cap China ETF (FXI) on April 20, 2020. That ETF is up 6.51% as of the June 25 close since that addition.)
Tomorrow, Friday, June 26, I’m also selling that Yen ETF out of my Jubak Picks Portfolio.
Cash flows indicate that the yen is likely to stay weak agains the dollar. Japanese investors and traders apparently (strangely enough) seem to prefer the prospects of earnings 0.68% on 10-year U.S. Treasuries to the 0% yield on 10-year Japanese government bonds. Japanese investors and traders have been buying long-term dollar swaps at a rate that in May sent the yen/dolar 30-year contract to its most negative for the year in May. And even the flood of dollars from the Federal Reserve haven’t tempted yen investor and traders to rethink their position.
It looks like, then, that the dollar will say strong against the yen for a while and that works against a position in this yen ETF.
Since I added this position in the Invesco Currency Shares Japanese Yen ETF in on January 4, 2019, I show a loss of 0.30% as of the close on June 25.
Closing this position also gives me more cash in case the August/September selling that I’m anticipating gives me a chance to buy a bargain or two.