Yen carry trade

The Yen carry trade is a financial strategy where investors borrow money in Japan, where interest rates are very low, and use that money to buy assets in countries with higher interest rates or better returns. The goal is to profit from the difference between the low borrowing costs and the higher returns elsewhere. If the Japanese yen remains stable or weakens, investors can also benefit from currency movements. However, this trade involves risks, such as currency fluctuations and changes in interest rates, which can lead to losses.