Yuan Carry Trade Is Back on Top as China Enforces Stability
- Yuan is gaining, volatility is low, interest rates are high
- High real yields make Chinese bonds attractive: Invesco’s Hu
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The yuan carry trade is back.
The appeal of owning the Chinese currency is growing, after two years of depreciation wagers. Selling the greenback and using the proceeds to buy yuan has delivered Asia’s highest Sharpe ratio -- a measure of returns adjusted for price swings -- over the past three months.