3 ETFs Offering Exposure to Japanese Yen
As yen is the official currency of Japan and the currency of the accounts of the Bank of Japan, the Japanese central bank, yen is the third-most traded currency in the foreign exchange market, after the United States dollar and the euro.
Japanese yen-focused exchange traded funds, a.k.a. ETFs, allow traders and investors to get long or short exposure to the JPY currency. Furthermore, Japanese yen ETFs also can be bought and sold through a traditional brokerage account, with no need to open up a foreign exchange, a.k.a. forex, account.
New ETFs launch all the time, but currently, there are three different yen-focused ETFs for traders and investors to consider – two of which are issued by ProShares, and the other is issued by Invesco. Here are the three specific currency ETFs to look at:
Invesco CurrencyShares Japanese Yen Trust (NYSE: FXY)
Launched in February 2007, the Invesco CurrencyShares Japanese Yen Trust is designed to have performance that tracks the price of the Japanese yen, and therefore only holds yen. Shares of the Invesco CurrencyShares Japanese Yen Trust trade on NYSE Arca under the symbol FXY, and its shares can easily be bought and sold in most brokerage accounts, Roth IRA accounts, and more. As shares of FXY are priced in U.S. dollars, the ETF offers an alternative path to a dollar yen trade. FXY has an expense ratio of 0.40%.
ProShares UltraShort Yen (NYSE: YCS)
Launched in November 2008, the ProShares UltraShort Yen ETF targets daily investment results, before fees and expenses, that correspond to two times the inverse (-2x) of the daily performance of the price of the Japanese yen versus the U.S. dollar. Shares of the ProShares UltraShort Yen ETF trade on NYSE Arca under the ticker YCS, and its shares can also be bought and sold relatively easily through any major broker. It should be noted, however, that as this is an inverse ETF, a long position in YCS is a bearish position against yen. Furthermore, it should be noted that this is a leveraged ETF and, as with all leverage can carry greater risk. YCS has an expense ratio of 0.95%.
ProShares Ultra Yen (NYSE: YCL)
If you’re a yen bull looking to make a bullish bet with an ETF – look no further. Also launched in November 2008 alongside the ProShares UltraShort Yen ETF, ProShares’ Ultra Yen ETF seeks a return that is 2x the return of its underlying yen benchmark for a single day, as measured from one daily net asset value calculation to the next. Shares of the ProShares Ultra Yen ETF trade on NYSE Arca as well, under the symbol YCL, and its shares can also be traded relatively easily through any major brokerage. Just like YCS, YCL is a leveraged ETF and, as with anytime leverage is in play, can carry greater risk. Just like YCS, YCL also has an expense ratio of 0.95%.