“By July 16th, the equity markets and many other risky asset markets peaked. For whatever reason, these asset markets began to sell off. As the sell-off continued, recent entrants into the YCT [yen carry trade] saw their assets falling, and to be clear, that is almost always the driver of unwinds. But worse, the Yen began rallying slowly. That began the unwind,” Andy Constan, CEO of Damped Spring Advisors, said in a detailed yen carry trade explainer on X.
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