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Asia’s 13% Carry Return Lures Record Japan Funds Amid Yield Hunt

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Japanese investors are buying Asian assets like never before as Prime Minister Shinzo Abe’s policies make the yen a lucrative means to fund bets on regional growth.

A net 1.82 trillion yen ($15.4 billion) flowed into stocks and bonds in the rest of Asia in the first nine months of 2014, 76 percent more than the previous record in 2007, data from Japan’s Ministry of Finance show. Borrowing in yen to invest in the 10 currencies that make up the Bloomberg-JPMorgan Asia Dollar Index returned an annualized 13 percent this year through yesterday. That beat so-called carry trades funded in euros and dollars, which gained 11 percent and 0.3 percent, respectively.