The depreciation of the yen is unstoppable! So what about individual investors?

The depreciation of the yen has not subsided at all.

Well, at the Bank of Japan meeting on the 14th”It doesn't do anything after all」「Postpone the problem for a month and a halfIt became”,The government side also does not specify any means other than interventionSo if you say it's natural, it's natural.

Whether you complain to the Bank of Japan or Governor Ueda, whether you complain to Prime Minister Kishida, or complain to the Ministry of Finance, the situation will not change. We individual investors who use charts to look at market pricesCorrectly grasp this fact and respond to it to defend yourselfThere is nothing but that.

First, take a look at the chart below.

This is the top halfJapan-US interest rate difference。

As a simple synthetic index in TradingView,
US10Y - JP10Y
Just type it in and it's OK.

The great thing about TradingView is that it is possible to synthesize these different indices and stocks using only simple arithmetic operations. I don't think there are many Japanese securities company apps that can do this kind of thing flexibly.

And the bottom row is simplyDollar yen: USDJPY It's just showing. This is the only chart.

Vertical lines, arrows, and text are written in a jumble, so it looks like a slightly confusing chart, but the content is very simple.

But look at this”Review and correctly adjust your investment tactics and portfolio” You have to be able to do it.

This isEven with the same Japan-US interest rate difference, yen depreciation has progressed frighteningly in a short period of time such as 6 months or 9 monthsIt shows.

First, let's take a look at the green line.
The interest rate difference between Japan and the US on 23/12/1 was 3.55. And that day's dollar yen was 147.0 yen.

Next, if we look at the same Japan-US interest rate difference level of 3.55 in the right direction, it is around 2/22, around 3/19, and around 5/9 where it once exceeded 3.8% and then dropped to 3.55% again. What is the dollar to yen at this time
2/ 22:150.3
3/ 19:150.8
5/9:155.8
And, the depreciation of the yen is progressing. Since the dollar yen on 23/12/1 was 147.0,The yen depreciated by a whopping 8.8 yen until 155.8 on 5/9 due to the same interest rate differenceIt has become.

Similarly, if you look at the blue line and the 3.43% level, 12/7 '23 is 144.2 yen, and 6/11 is 157.1 yen. whoppingThe yen depreciates by 12.9 yen even with the same interest rate differenceIt's swaying.

Finally, today's 6/18 level, interest rate difference is 3.33%.
At this year's big launch, the interest rate difference that once divided by 3.3% surpassed 3.3% again. The dollar to yen at this time was 143.3 yen.
And today it's 157.7 yen.The yen depreciated by 14.4 yen in six monthsSo that's it.

You can see that in half a year with the same interest rate difference, the depreciation of the yen has been steadily widening.

As we all already know, the depreciation of the yen is not just about interest rate differences between Japan and the US, and there are a wide range of reasons why yen is sold, such as digital trade deficits, explosive demand for overseas stocks due to NISA, the yen does not turn even if a company makes a profit overseas, and yen carry trade does not easily converge...

butI don't care about thatThat's it.

The fact is, as this chart shows,Even at the same Japan-US interest rate difference level, the yen depreciated by 10 yen or more in half a year、The fact that yen cannot be bought even if interest rate differences shrinkThen, look at thisIt is important for us individual investors to be aware that we have to change our investment tacticsIt is.

Even with such a simple chart, there are many important points of view.
You can see that paying at least a large swap interest rate, shorting the dollar to yen over a long period of time, and increasing losses while praying for exchange intervention is an investment tactic that should not be done the most.

Furthermore,If you don't distribute Japanese yen assets into assets such as stocks, bonds, foreign stocks, foreign bonds, commodities (mainly gold), crypto, and real estate (mainly REIT), it's more dangerous than you can understand in your headYou'll notice that this isn't going to happen.

Of course, the current depreciation of the yen is also a major factor in supply and demand, which has gone too far, so if the US cuts interest rates and the Bank of Japan enters the phase of raising interest rates, a major reversal will come and the yen will appreciate. Originally,Calculation that the interest rate difference between Japan and the US can rise by 5 yen to 7 yen just by reducing 0.1%because that was it.

If the US cuts interest rates by 0.25% once by the latter half of this year, and Japan raises interest rates once to +0.25%, the interest rate difference is reduced by 0.5% by simple addition. If it is at the 10-year interest rate difference level, if you expect the interest rate difference to shrink by about 0.35%, it is an arithmetic factor of 15 yen to 20 yen appreciation.

In other words, if the yen depreciates to the first half of the 140 yen range.

However, this is a simple calculation of interest rate differences, and it is a situation where yen depreciation progresses by 10 yen or more even if interest rate differences do not change in the past 1 year or 6 months. Even if a certain amount of excesses are resolved, it can be predicted that the yen will quickly depreciate again.

In other words, even if the yen appreciates to about 142 yen in half a year from here this year, there will be a bias of +2 to 3 yen depreciation during that time.
Even if there are further interest rate cuts in the US and interest rate hikes by the Bank of Japan in 2025, there is no way that the yen will appreciate according to the arithmetic that I envision now.

I think that even if the yen appreciates to the 130 yen level in 2025, it will be 145 yen around 2027, and 150 yen if it doesn't work well. And when the US goes into a business cycle where interest rates have to be raised again, isn't the dollar yen going back and forth at a level up to about 165 yen with a lower price of 150 yen? I think so.

If you look at this Japan-US interest rate difference and the dollar-yen level chart, I think you can see the flow with a sense of sight without looking up difficult or specialized things.

If so, I think I have to set up an asset portfolio based on that premise.

If it is a long-term portfolio of 5 to 10 years, I think we should not stop doing US stocks, US bonds, and dollar-denominated assets... since the yen will appreciate from now on, and think again about what to do with assets other than yen in anticipation of an era where 150 yen will fall.

Even in that sense, the value of our yen would be damaged, I also think that Japanese people should look at gold (Gold) and BTC.
Of course, they invest in stocks and bonds.