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fanl1
11-13-2006, 10:07 AM
Hello everybody.

I have looked arount the forum a little bit but have not found any thread specializing in currency pair.

I am checking to this pair for quite some time. I am a newbie in Forex, but possess a simple understanding of the market.

So my question to you, the pros, is the following:

If I was to go long (I know, not a very intelligent choice in the moment) - but somewhere in the following months, and decide for a carry trade i.e. maintain the NZD for a lengthier time period.

I've done some calculating and got the following figures:

Investment - 1500EUR
Long two minilots
Daily interest rate (in the momet 7%/365) = ~1,9 EUR
In annually that the interest will be ~714 EUR, which is 48 percent of the initial investment.

This position could be with no stoploss order, because the 1500 EUR would mean that could fall for 1100 pips, which might mean that the value could fall to (if bought at 78,00) 67,00. The value for this pair was 64,32 and lowest this season was 67,77.

In theory if the currency is ranging from lets say 67,00 to 87,00 (max value, as well as max 2006), this position could remain open throughout the year.

A 48% annual income isn't such a bad thing?

Please post your opinions on this notion and feel free to rip it apart, it will save money .

Oh, and I forgot - that the leverage is 400:1.

Any other comments on this pair are very welcome.

Thanks for writing.

Regards.

fanl1
08-19-2023, 10:07 AM
You are most likely right there Jan about the current interest rate differentials between the afore mentioned currencies (I have not checked them!!) .

However, I was refering to the interest payments you're going to get from your broker.

OK, an individual ought to reflect another, but apparently that's not the case (and I have no idea why!!) .
Taking fxcm for instance, their interest payments for 1 mini lot of NzdJpy is $1.23 per day, for GbpJpy it is $2.40 daily.

Except for not keeping this thread dedied solely to Nzd/Jpy!!

Cheers,
Tim. I believe this is plausible, as 1 lot of NZD/JPY means that you own 100.000 NZD=83*100.000JPY and long for 1 lot GBP is 100.000GBP=232,5*100.000 JPY. Then you figure out the rates (7% for long NZD and 4,75% for long GBP daily (/365). That's where the difference is. 1 lot of NZD is of less worth than 1 lot of GBP.

okeinamixxiok
08-19-2023, 11:28 AM
In GFT u need only 25nzd for each and every mini !

Oxnirropk
08-19-2023, 12:49 PM
. . .exchange rate growth is much more important than interest:

What if the trade goes against you?
You say whether it goes to 67,00 the first capital is lost, so if that happens at the end of the year, your ROI will be -52%! If it looses more, you would be. On the other hand if it goes in your direction you would acquire a lot more than 48% of course.

The fantastic news is that (in my limited experience ) the currency with the reduced interest yield is more inclined to depree. I believe in the long term interest rates mean more liquidity, greater inflation and finally valuable fiat money.
If that's true, the only doubt would be that the BOJ is coming to its senses and proceeds to increase the rates.

So you ought to only do it, if you believe NZDJPY will grow or stay it is. Don't simply bet the losses will be outweighed by the interest gains.

suarwzsj
08-19-2023, 02:10 PM
Rabax,

Leave enough space so you feel very safe regarding the trade. If your max drawdown wouldn't lead to a margin call, yes this is a great investement.

Additionally look at such currencies as ZAR/JPY, I think that is an 8.5% difference or something crazy.

fanl1
08-19-2023, 03:30 PM
,

Leave sufficient space so that you feel really safe regarding the trade. If your absolute max drawdown wouldn't cause a margin call, yes this is a fantastic investement.

Also look at these currencies as ZAR/JPY, I think that's an 8.5% gap or something mad. That is exactly it.

With 1,5k EUR, I could manage the currency (if purchased at 78,00) to lose 1100 pips with 2 minilots purchased. Of course with interest, my position will be getting stronger as interest flows in, so I could manage a broader span.

In my view the perfect buy price would be 74-76, that's why I chose to wait a bit longer. I am hoping it will drop a little bit more.

ZAR/JPY from what I can see is about 50% more volatile than NZDJPY, which I would believe a far riskier investment. I don't want to get overly greedy.

Greed usually hits you in the face... with a major steel rod.

Even if the position will fall, I'm in no hurry to liquidate it. It is better if it goes up, but not my aim.

Of course, there'll most likely be an increase in interest rates of BoJ from the following year and maybe a decrease in interest rates of Bank of NZ. But so far it seems okay.

It would be great if anybody knows of any websites (maybe even this one?) That have a log of interest rates. Or I'll just go check it on google.

As for the NZD/JPY rate, I am pretty certain NZD/JPY will fall to somewhere around 77, or even lower. I am thinking about buying at about 76 or less (as mentioned previously). We are going to have to wait and view only time will tell.

fanl1
08-19-2023, 04:51 PM
You just have to enjoy NZD. Still it's doing great, although didn't drop to 77 or lower, it had been near fortunately.

If anyone has any other comments about this pair, please discuss them. It's interesting to find the NZD getting more powerful, even tough it's a opinion that rates will likely be rised on JPY and greater next year.

Gotta love the interest rates combined with leverage!

Went so long over the AUD/JPY as well, but I'm more concerned, because it's on a record high, we'll see how long it lasts.

Regards to all,
Jan

Sarioli
08-19-2023, 06:12 PM
Hi Jan,

Merry Christmas, great thread. I am in aud/jpy and on the lookout for similar zar/jpy or kiwi/yen.

I know the idea and think for a newb its a good way to grow our caps prior to reaching other higher risk currencies.

Can you because nov? If yes, what is it doing? Will be good to hear from you.

Your swap needs to be about your capital by now I guess, kaching!

Anaapple
08-19-2023, 07:33 PM
First, I discovered this site offering exceptional fundamentals on NZD: http://www.beehive.govt.nz/
Secondly I built a system around the NZD/JPY. It requires some work. If you exchange this pair, please check out my system, hyperlinked on my signature.

Tom

fanl1
08-19-2023, 08:53 PM
Hi Jan,

Merry Christmas, Excellent thread. I am in aud/jpy and looking for similar zar/jpy or kiwi/yen.

I understand the idea and believe for a newb its a good way to cultivate our caps prior to reaching other high risk currencies.

Did you since nov? If yes, how's it doing? Will be good to hear from you.

Your swap needs to be about your funding by today I guess, kaching!
Well.

First I have to emphasize that I am still demoing, and it's not real money right now (that is awful at the moment, since I would have made a healthy profit), however there will be chances within the next year too.

I have to say, that previously I made some stupid choices, and tried to get as much out as you can, without any regard, to risk. First I went 3 lots, once I made over 2500 EUR on the 3 lots (beginning capital was 5000 EUR). It was great having the value of NZD growth and receiving high interest at the moment. So of course, if we are profiting, why don't you profit more? I went and bought 5 lots of NZD. I figured since I was 2500 EUR in profit, the profit could cover a possible loss, but was at precisely the exact same time convinced that NZD will still continue to go up.

Properly the transaction turned against me, but I could afford to wait it out. After about a week, I had a negative balance of cca. 2000 EUR (since 5 lots weighted against the profitable 3 lots heavily). I shut the transactions and chose to cut back my lossess.

If I would stick it out, I would have a huge profit by today, but when the NZD would not rise again, I would have lost all.

This combined with a few other stupid things I did, reduced my account to 1500 EUR.

That is when I decided to begin playing by the rules (money management, stops, assess the currency pair, in regard to what will happen with it in the future, etc.). This is how I chose I use right now and this is the greatest problem of all - impatience and Greed.

Since 17th of November I've been playing by the rules, and so far I've an account (in open transactions) of cca. 2300 EUR, that is the that I've been planning for. I am scaling up in to trade, therefore additionally covering together with the already made profits.

I wonder what will happen with the real money, but I believe I learned my lession. Getting wealthy if not an option, losing all immediately to it is. Play your cards right, minimise risk and keep profit is the secret. Greed is the killer of all.

I can not wait to start. And I have to say I really like NZD/JPY pair, have done two transactions on AUD/JPY too, but since I said I am more concerned about those 2 transactions turning against me, but it's covered so far.

Regards, Jan

fanl1
08-19-2023, 10:14 PM
First, I found this site offering exceptional fundamentals on NZD: http://www.beehive.govt.nz/
Second, I built a system around the NZD/JPY. It needs some work. If you exchange this pair, please check out my system, hyperlinked in my signature.

Tom I posted my view in your system in your own thread.

Regards,
Jan

luanatika
08-19-2023, 11:35 PM
Jan,

Have you looked into running exactly the same carry trade on Gbp/Jpy?

IMHO, I believe the rollover credits/ interest payments per mini/lot are almost double that of Nzd/Jpy (OK, the trading range is far greater also!!) .

Cheers,
Tim.

fanl1
08-20-2023, 12:56 AM
Jan,

Have you ever looked into running the same carry trade on Gbp/Jpy?

IMHO, I believe the rollover credits/ interest payments per mini/lot are almost double that of Nzd/Jpy (OK, the trading range is far greater too!!) .

Cheers,
Tim. It is a very interesting pair too and has been in a very pleasant long-term uptrend this year and this month. Would think about it a buy definately, no matter how the interest rate gap is far lower (5%-0.25%=4,75%) then NZD/JPY (7.25%-0.25%=7%). But if we'd think about the development in the value, it would be a massive gain. A definite buy.

Regards,
Jan

luanatika
08-20-2023, 02:17 AM
You are probably right there Jan concerning the current interest rate differentials between the afore mentioned currencies (I haven't checked them!!) .

But, I was refering to the interest payments you're going to get from your broker.

OK, an individual should reflect another, but apparently that's not the case (and I have no idea why!!) .
Taking fxcm as an example, their interest payments for 1 mini lot of NzdJpy is $1.23 per day, for GbpJpy it is $2.40 per day.

Sorry for not keeping this thread devoted solely to Nzd/Jpy!!

Cheers,
Tim.

oxrayselas_
08-20-2023, 03:37 AM
Jan,

Have you ever looked into running exactly the same carry trade on Gbp/Jpy?

IMHO, I think that the rollover credits/ interest payments per mini/lot are nearly double that of Nzd/Jpy (OK, the trading range is far greater too!!) .

Cheers,
Tim. Interest works out to be much with GBP/JPY as your lot is worth nearly twice up to 1 NZD lot. If you purchased 3 NZD lots, it might come out in USD to be just a little more than what the USD value of 1 lot of GBP

Thus, NZD = less equity per lot.

Hope that helps to understand that the diff

GF

Orduniik11
08-20-2023, 04:58 AM
Surely, GBP/JPY and NZD/JPY bith have pip values of $0.85 a pip (to get a US$ account) so how can you be worth less than the other?

Bonus points to get an 'Airplane' quote at the reply!!

suarwzsj
08-20-2023, 06:19 AM
This dip on each of of the JPY pairs seems like the ideal chance to begin watching for a long set. Though caution clearly ought to be high considering the discussion of as high as .50 bp rate rise within the next few months. Since I've no place in any carry trades, I welcome this dip... I expect for my sake (isnt it : ) that this dip continues and now I'll get cheaper prices for my hopefully long hold north.

CHF has been shortened a lot as well right now, with rising rates coming (possibly) in Japan, CHF can become close as equivalent a carry trade using its low 2 percent currency interest.

Any other ideas?

fanl1
08-20-2023, 07:40 AM
I believe the thing that is main is going to be the decision on interest rates in Japan. We are going to have to wait and see, what's going to happen. The truth is, that NZD and AUD are still very strong against JPY.

Between us, I'm hoping for the YEN to gain against NZD and AUD, so we get a better for both.

Haven't looked into the fundamentals a lot recently, so this is simply a wish with no company arguments. But so much as I hear, BoJ should increase rates this month and lay ground for further rate rises. Who knows, we'll have to wait and see, but I'd short in the moment, as the retracement is far from over.

suarwzsj
08-20-2023, 09:00 AM
Between us, I'm hoping for the YEN to gain against NZD and AUD, so that we get a better for both.

. Although I have taken advantage of this change and plan to maintain as long as possible, I couldnt agree more with your statement. With a .50 rate raise by Japan, the market will have no currency to carry against. With JPY power it'd do good things for those that are looking to get into pairs long term such as NZD and AUD JPY.

fanl1
08-20-2023, 10:21 AM
Darn, I missed the entrance at 77...

recre_90
08-20-2023, 11:42 AM
High impact news on Wednesday.
Keyword: Inflation (Suppressed)
Inflation figure: https://www.rbnz.govt.nz/monetary-policy/inflation

Barclay's prediction for this week: http://www.forexlive.com/news/!/barclays-trade-for-the-week-ahead-is-short-nzdjpy-entry-stop-target-20180211
Validity: By the Wellington open Monday morning into the New York close Friday

Entrance 78.78 Take-profit: 76.20 prevent loss at 80.08
https://www.cliqforex.com/attachments/1519044694147422573.jpg