Japan’s day traders are making record bullish bets on their home currency, just as the world turns against it.
As the yen slumped to a six-year low against the dollar last week, retail investor net-long aggregate positions in the currency climbed to ¥258 billion ($2.1 billion) — an all-time high — according to a Bloomberg analysis of Tokyo Financial Exchange Inc. data going back to 2006. A bulk of the yen positions versus 14 peers were against the dollar and the euro, while investors are bullish on the Mexican peso, South African rand and Turkish lira.
The data show mom-and-pop traders have traditionally held net-short positions against the Japanese currency, as they seek higher yields abroad than the near zero at home.