Monday, Jun 25, 2007
the day it happens some hedge funds will crumble
japan.seekingalpha.: What Will Unwind the Carry Trade?
We seem to be at an interesting period with the carry trade. There are some winds of change that are brewing, and I'm not so sure that the carry will carry on. We all have to agree that at some point, regardless of the circumstances, the carry will unwind. But, what would it take to get that started?In order to understand what might unwind the carry, first, look at what makes the carry. To begin with, in order to determine a yen cross rate, say the GBP/JPY, you have to multiply GBP/USD times the USD/JPY. That's the way the market determines the exchange rate of the crosses, off of the majors.
Posted by out of control speculators @ 05:07 AM (147 views) Add Comment
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