Japan election result sours hedge funds’ yen options bets
Dealers saw flows in significant size for JPY weakness but were forced to take profits
Hedge funds that bet the yen would materially weaken following last weekend’s Japanese election were left disappointed after prime minister Shigeru Ishiba announced he would stay on, despite his ruling coalition party losing control of the country’s upper house.
Going into the election, investors had turned bearish on the yen, holding roughly $1.1 billion in short futures and options wagers
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