The Japanese yen has had quite the struggle over the past few years, as an anemic economy has failed to bolster the currency. As such, the yen has been one of the hardest hit currencies. Japanese monetary policy has been quite loose, with a number of asset-purchasing programs in place that have artificially lowered the yen. For now, a lower yen will help Japan grow because it is forced to import many of its resources and goods. Once the economy begins to pick up, however, monetary policy will likely tighten and the yen will rise to a more natural level.
The economy has already shown a few sparks of life, with GDP growth increasing threefold last quarter. For the contrarians at heart, the CurrencyShares Japanese Yen Trust (FXY) is your best bet. The fund is sitting near five year lows, presenting a great entry point. Note that as a currency, this pick will be particularly volatile. But the upside could be quite handsome for anyone willing to stomach the volatility.
Jared Cummans writes for ETFdb, which offers a comprehensive and original ETF database and analytical consulting services for advisors and investors, as well as a free newsletter. Learn more about their services by visiting ETFdb.com. Disclosure: the author had no positions in the securities named in this article at the time of writing.