SWIP's Carver backs long yen/short euro trade

James Carver, manager of the SWIP Absolute Return Bond fund, is making a call on the Japanese currency strengthening against the euro as money continues flowing into Japan's equity market.

The manager is shorting the euro versus the yen in his portfolio in the view the currency cannot continue weakening, despite the central bank's efforts, if investors remain positive on Japanese stocks. "The trade has been a negative one for much of the year so far, but it does not make sense for the currency to keep weakening if everyone keeps buying Japan," said Carver (pictured). "If there is any more strength in the Japanese data, the currency might start strengthening, and investors who are currently hedging out their yen exposure may start to remove their hedges." Earlier this...