Cheap European tech ETF's could prompt rotation away from U.S. tech, says NewEdge's Ben Emons

THE YEN A RUNAWAY DEVALUATION, BUT SEES A TECH TRADING OPPORTUNITY HERE IN THE WEAKNESS BEN IS A SENIOR PORTFOLIO MANAGER AND HEAD OF FIXED INCOME AT NEW EDGE WEALTH GREAT TO HAVE YOU WITH US. THANKS FOR COMING IN SO, WE HAVEN'T -- YEN CARRY TRADE. THAT'S WHAT'S FUELING A.I. HERE? >> I THINK IT'S PART OF RISK TAKING IT'S A TRADITIONAL TRADE PEOPLE BORROW YEN, GO OUT

AND TAKE RISK. SO, YOU GO BACK IN, SAY, 20, 30 YEARS AGO, THAT WAS ONE OF THOSE KEY TRADES THAT WAS UNWOUND AND BECAME REVELATION OF, YEAH, JAPAN WILL STAY AT ZERO AND STAYS AT ZERO, EVEN TODAY, TRYING TO ASK HIM ABOUT, WHAT DO YOU DO NEXT? STILL SAYING AT ZERO, NEGATIVE SO, CHEAP MONEY IS THERE, EVEN THOUGH ELSEWHERE, MONEY'S GOT A LOT MORE EXPENSIVE IF

YOU LOOK AT IT THAT WAY, SO, IT FEELS RISK-TAKING. I THINK THE YEN CARRY TRADE IS SOMETHING TO REALLY WATCH. >> IT FEELS LIKE, BEN, AS LONG AS THE YEN REMAINS WEAK, THIS CARRY TRADE COULD, IN FACT, CONTINUE AND SO, WHAT COULD THE WAY TO DO TO STEM THIS WEAKNESS? I MEAN, INTERVENTION, HISTORICALLY, DOES NOT WORK AT LEAST FOR SUSTAINED PERIODS OF TIME, MAYBE JUST TEMPORARILY,

SO -- I MEAN, WHAT WOULD NEED TO HAPPEN FOR THIS TRADE TO END >> YEAH, THE LINE IN THE SAND IS THE DIFFICULT ONE, YOU KNOW, TRADERS LOOK AT 145 TO 150 TO THE DOLLAR THERE WAS SOME STATEMENTS OUT FROM OFFICIALS IN JAPAN THAT WE'RE MONITORING IT CAREFULLY, BUT THAT VERBAL INTERVENTION, THAT DOESN'T DO MUCH SO, IT COMES DOWN TO TWO THINGS, I THINK. ONE, JAPAN

DOES SUCCEED AND BANK OF JAPAN CAN STAND UNWIDING THAT CONTROL. OR THE OTHER TURN IS THAT THE FEDERAL RESERVE REVERSES THAT LATTER, I THINK, IS NOT YET HAPPENING. POWELL WAS PRETTY CLEAR ON THE PANEL, WE HAVE MORE TO GO, AND THE MARKETS ARE SPRICED THERE SO, WE WAIT UNTIL WE GET AN INTERVENTION AND THAT'S A LOT OF THINGS >> SO, TO ME, LIKE, WHEN I HEAR

THIS, I THINK OF IT IN A COUPLE WAYS ONE IS THAT MAYBE THIS A.I. TRADE WILL LAST EVEN LONGER, AS LONG AS THE YEN IS WEAK, AND YET, YOU SAY THAT THERE WILL BE A ROTATION OUT OF U.S. TECH INTO EUROPEAN OR ASIAN TECH WHAT CAUSES THAT ROTATION >> FAIR POBINT, IN THE SENSE THT YOU CAN CONTINUE WITH THIS YEN/U.S. TRADE SO TO SPEAK BUT IF

YOU LOOK AT EURO/YEN, THAT'S EVEN MORE OUT OF CONTROL. THAT'S MOVING UP, AND THAT'S REALLY BECAUSE THE ECB IS EVEN MORE ON A TRAJECTORY TO TIGHTEN. SO, IF YOU THINK ABOUT IT FROM A CURRENCY PERSPECTIVE THAT WAY, AND YOU LOOK AT EUROPEAN TECH, AND THAT'S A BIT DIFFERENT SECTOR THAT WE HAVE IN THE U.S., BUT IT'S AN INTERESTING ONE, BECAUSE THERE'S COMPANIES LIKE, BACK HOME WHERE

I'M FROM, THE NETHERLANDS, WHERE YOU HAVE, YOU KNOW, A COMPANY THAT DOMINATES THE SUPPLY CHAIN ASML IS A COMPANY THAT GENERATES MACHINES, THAT ALLOWS YOU TO BUILD CHIPS. SO, THE COMPANY, I THINK, ABOUT 32, 35 FORWARD MULTIPLE, BUT IT'S ACTUALLY TRADING CHEAPER THAN NVIDIA ANDORS AND ACTUALLY LAGGED ON THE YEAR SO, IT'S AN INTERESTING THING IN TERMS OF EURO/YEN VERSUS EURO TECH >> I THINK I'M

ABOUT TO LEARN SOMETHING. THE NIKKEI IS UP A LOT THIS YEAR, UP 27-PLUS, BUT ADJUSTED FOR CURRENCY, UP 15, 16 MAYBE? ISN'T THAT A LOT OF MONEY GOING INTO THE NIKKEI AND GOING INTO -- DO MOST OF THOSE, DO THEY BUY THEM IN DOLLARS, EURO YOU FIRST HAVE TO BUY IT IN YEN AND KEEP IT IN YEN, OR CONVERT IT TO SOMETHING ELSE THAT COUNTERBALANCE WHAT

YOU'RE SAYING >> MAYBE IT TO AN EXTENT, KARNGS B KAREN, BUT THE TRADITIONAL IDEA OF YEN HEDGING, I USED TO DO THIS IN PORTFOLIOS, HEDGING T-BILLS TO DOLLARS, YOU BUY YNEZ ST JAPANESE STOCKS, PROBABLY DONE A LOT BY FUND MANAGERS THAT WANT TO ALLOCATE TO JAPANESE STOCKS I THINK THE WEAKNESS OF THE YEN IS DIFFERENT THEY STICK WITH THIS POLICY, THEY WANT TO GET TO THE

2% INFLATION, THEY ARE NOT GIVING UP ON THAT GOAL, SO, IT'S GOING TO DRIVE THE YEN EVEN WEAKER