The Yen has been sinking like a stone against the dollar for the past 2 months, yet this triple short JGB ETF is down over that timeframe, while JGB 10-yr interest rates are relatively flat?
I thought this vehicle was supposed to capture the change in exchange rate of the yen vs. the dollar. So if the Yen is down 10%, shouldn't this ETF have risen 10% (or maybe 30%?) in the past 2 months, instead of sitting flat?
It looks like the Japanese are going to do a lot of printing to get out of this mess, and destroy the Yen. If this ETF can't capture that kind of action, but only captures actual interest rates and/or defaults, it isn't as robust as I imagined.
" he investment seeks to replicate, net of expenses, three times the performance of the DB USD Inverse JGB Futures Index. The index is intended to measure the performance of a notional short position in 10-year JGB Futures."
You would of have to bought YCS to capture the movement of the yen. IMHO once they lose control of the yen then this will start moving.