Raw Japan

Slices of Japanese business, politics and life

Kimono trader sees no easy money

January 30, 2009

Japan’s best known retail currency trader, a housewife who made 800 million yen ($9 million) on the dollar, euro and pound, warns there is no such thing as easy money and investors must work hard and educate themselves not to get caught out in the volatile market we see these days.

Nicknamed the “kimono” trader by foreign and Japanese media, 61-year-old Yukiko Ikebe says many retail traders in FX margin trading lost big money late last year when Lehman Brothers collapsed and the yen soared broadly on safety bids.

The financial damage was severe for those who had a lot of money to spend and they now come to Ikebe’s lecture tours on FX trading to learn how to cope with tsunami in the foreign exchange markets and to find ways to recover their huge losses, she says.

Forex

“Those who had managed to survive the yen’s advance in August 2007 and March 2008 by paying margins to avoid automatic closure of the positions were all crushed with yen’s big jump in October last year,” Ikebe told me. “That became a wake-up call for everyone.”

For years Japanese retail investors profited from investing in higher yielding currencies abroad like the Australian and New Zealand dollars, with the yen shrinking, and higher interest rates elsewhere offering better returns.

But that has all changed with world financial markets in crisis and the yen at 13-year peaks versus the dollar and seven-year highs versus the euro.

Ikebe became a social phenomenon overnight when she hit the headlines two years ago for facing a tax bill on profits of $4.5 million from her trades. She is shy of being photographed but has become an icon for housewives looking for ways to make extra money, and has written a book called “The Secret of FX”.

But her success in Japan’s popular FX margin trading since 2000 was not just a result of a favourable market environment and her technical analysis originated in the years of her trading commodity futures.

Charting rapidly became a passion which improved her trading performance, and she rattles through instructions for candle charts, Fibonacci retracements, and relative strength indexes.

She closed many of her positions last July, just before the collapse of Lehman Brothers, and her lecture tours mean she doesn’t trade as much as before or have time for her favourite hobby of designing artificial flowers.

Given the choice between the two, she confesses there is no competition: “If I were asked to choose between art flowers and trading, I want to pick art flowers because I like it so much.”

Photo credit: REUTERS/Kim Kyung-Hoon

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