The Yen Carry is Perfectly Correlated with the Stock Markets (even--intraDAY!!!)

Ivanovich,

If S&P futrs are up, it doesnt mean they'll stay up, and thus you can get tapped out on the yen trade. Am I wrong here?


Some of you are not understanding the full extent of this correlation, it is a "dynamic correlation"! In other words, the Yen can move up or down .05, .11, .16 etc. and the Dow/S&P will move up or down in a corresponding fashion. Charting and juxtaposing the two financial instruments is useful even for scalping, and trading pivot points, entrances/exits depending upon your trading time frames.

I am sure there are some stat arbitrage possibilities, that black boxes, computer programs are taking advantage of that is even exacerbating the correlations between these financial vehicles.
 
Ivanovich,

If S&P futrs are up, it doesnt mean they'll stay up, and thus you can get tapped out on the yen trade. Am I wrong here?


Some of you are not understanding the full extent of this correlation, it is a "dynamic correlation"! In other words, the Yen can move up or down .05, .11, .16 etc. and the Dow/S&P will move up or down in a corresponding fashion. Charting and juxtaposing the two financial instruments is useful even for scalping, and trading pivot points, entrances/exits depending upon your trading time frames.

I am sure there are some stat arbitrage possibilities, that black boxes, computer programs are taking advantage of that is even exacerbating the correlations between these financial vehicles.
 
That defense at 114 and turn in US after hours yesterday was all she wrote for the big world selloff. Wouldn't think of not having yen screen this year.
 
Yes you could be right about arbs. But how does the private trader benefit from this? I agree there is correlation, but the moves seem to happen at the same time. So whats the difference buying Usd/jpy than buying e-mini S&P?
 
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