Editor's Note: Our readers always benefit from our global perspective. We're sharing this Private Briefing interview with our readers because it gives them a unique window into the one profit play that beat George Soros to the punch – and delivered returns that were more than 60% greater than what Mr. Soros himself enjoyed. Here's Bill…
KYOTO, Japan – I can't think of any Westerner who has a better handle on Japan-related investment opportunities than our own Keith Fitz-Gerald.
And there's a reason for that. Keith, the Chief Investment Strategist here at Money Map Press, married into a Japanese family many years ago and spends at least part of each year living in that country.
That's given Keith an unrivaled global vantage point and has given his readers the kind of "first-mover" advantage that usually leads to big profits.
Let me share a story that illustrates my point…
Everyone knows that billionaire George Soros is a genius investor. In 1992, for instance, he famously made $1.7 billion – at today's exchange rates – shorting the British pound sterling.
More recently, in February 2013, The Wall Street Journal reported that Soros and some of this country's other big hedge-fund players had been reaping billions in windfall profits by betting against the Japanese yen – capitalizing on the fact that the Asian giant was forcing down its currency in an attempt to save its economy.
According to the newspaper, Soros in particular had made nearly $1 billion since November 2012 on wagers against the Japanese currency, which had skidded about 20% during the prior four months.
And he had lots of company. Such hedge-fund heavyweights as David Einhorn's Greenlight Capital, Kyle Bass's Hayman Capital Management LP, and Daniel Loeb's Third Point LLC had also been making big money on the falling yen. Indeed, in that story last February, the Journal reported that betting against the Japanese currency [had] "emerged as the hottest trade on Wall Street over the past three months."
I always laugh when I recall that story.
You see, back in a February 2012 interview here – a full year before that Journal story ran – Keith predicted the yen was soon to swoon. And he even showed us an ETF that offered an easy way to profit.
In short, Keith was eight months ahead of Soros and Co. His simple-to-deploy strategy yielded a peak gain of more than 71%. That gave us the chance to earn about 60% more than Soros … all because of that first-mover advantage I referenced.
Since Keith's in Japan right now, I figured we could use the opportunity to circle back with our chief investment strategist and gauge his current thinking on the world's No. 3 economy.
Here's a partial transcript of that interview…
Bill Patalon III: I know you try to spend part of each year in Japan. On this trip, you've now been there long enough and have been out and about to process what you're seeing and perhaps do a bit of analysis, too. I know that Japanese stocks are off about 11%, year to date, and that there are worries about the new consumption tax increase. What's the sentiment right now: Is it improving, or is it sagging?
Keith Fitz-Gerald: This is a great and timely topic, BP. In classic Japanese fashion, many in the nation are looking beyond the short-term market gyrations. The Olympics, in particular, have breathed new life and new hope into the nation at a time when this kind of an upbeat outlook is very much needed.
Bill: But there are still issues in the near term, aren't there?
About the Author
Before he moved into the investment-research business in 2005, William (Bill) Patalon III spent 22 years as an award-winning financial reporter, columnist, and editor. Today he is the Executive Editor and Senior Research Analyst for Money Morning. With his latest project, Private Briefing, Bill takes you "behind the scenes" of his established investment news website for a closer look at the action. Members get all the expert analysis and exclusive scoops he can't publish… and some of the most valuable picks that turn up in Bill's closed-door sessions with editors and experts.