DXJ: I'm Staying Hedged And Keeping An Eye On The Potential Decline In EPS

  • Despite the carry trade risk, the outlook for Japanese stocks has passed my stress test. Even if the market expects a falling DXY and a rising JXY, the hedged option remains mandatory, in my opinion. Key risks include a stronger yen hurting exporter profits and rising debt costs, but financial sector exposure could offset some negatives.