Over the past few years, the carry trade has been a major talking point in the financial markets. It is often mentioned in the news because a large number of investors use it as a trading strategy. The strategy is based on the economic theory of supply and demand since funds tend to flow into countries that have a higher return on investments. Simply put a carry trade is where a trader borrows money in a low interest currency (e.g. the Japanese Yen) and buys assets in a high-yielding currency (e…
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