10-K: Invesco CurrencyShares Japanese Yen Trust Reports Annual Results for Fiscal Year 2024

Invesco CurrencyShares Japanese Yen Trust reports its financial results for the year ended December 31, 2024, highlighting the impact of market volatility on the trust's performance.

Summary

• The Invesco CurrencyShares Japanese Yen Trust's investment objective is to reflect the price in USD of the Japanese Yen, less the Trust's expenses.
• The Trust's net comprehensive loss for 2024 was $1,630,251, compared to a net comprehensive loss of $1,442,296 in 2023.
• The Sponsor's fee for 2024 was $1,474,607, accruing daily at an annual rate of 0.40% of the Japanese Yen in the Trust.
• The Trust did not pay any distributions during the year ended December 31, 2024.
• As of January 31, 2025, the Trust had 6,700,000 Redeemable Capital Shares outstanding.
• The Trust will terminate on February 1, 2047, unless a termination event occurs earlier.
• The interest rate in effect as of December 31, 2024, was an annual nominal rate of 0.00%.
• The Trust's assets primarily consist of Japanese Yen held on deposit.
• The Trust is treated as a grantor trust for federal income tax purposes, with interest, gains, and losses passed through to shareholders.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While the Trust experienced a loss, the report is factual and provides necessary information for investors. The risks are clearly outlined, and the management structure is detailed.

Positives

• The Trust maintains a passive investment strategy, avoiding active management risks.
• The Trust provides a cost-effective means for investors to gain exposure to the Japanese Yen.
• The Trust has established internal controls over financial reporting, as assessed by management and audited by PricewaterhouseCoopers LLP.
• The Trust's shares are listed on NYSE Arca, providing liquidity for investors.

Negatives

• The Trust experienced a net comprehensive loss of $1,630,251 in 2024.
• The Trust's expenses, primarily the Sponsor's fee, can reduce the amount of Japanese Yen represented by each share over time.
• The Trust is subject to fluctuations in the price of the Japanese Yen, which can adversely affect the value of the shares.
• The interest rate paid by the Depository may not be the best rate available.
• The Trust did not pay any distributions during the year ended December 31, 2024.

Risks

• Fluctuations in the price of the Japanese Yen could materially and adversely affect the value of the Shares.
• If interest earned by the Trust does not exceed the Trusts expenses, the Trustee will withdraw Japanese Yen from the Trust to pay these excess expenses, which will reduce the amount of Japanese Yen represented by each Share on an ongoing basis.
• The Shares may trade at a price which is at, above, or below the NAV per Share.
• Substantial sales of Japanese Yen by the official sector could adversely affect an investment in the Shares.
• International Armed Conflicts May Result in Market Volatility that Could Adversely Affect the Fund's Performance.
• Pandemics and other public health emergencies could disrupt the global economy and adversely impact the Trust's performance.
• Changes to United States tariff and trade policies may increase the volatility of foreign exchange rates.
• Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act of 1940.
• If the Depository becomes insolvent, its assets may not be adequate to satisfy a claim by the Trust or any Authorized Participant.
• Due to the increased use of technologies, intentional and unintentional cyber attacks pose operational and information security risks.

Future Outlook

The report contains forward-looking statements regarding future performance, which are subject to various factors including fluctuations in the price of the Japanese Yen.

Industry Context

This announcement provides insight into the performance of a currency-based ETF, which is influenced by macroeconomic factors, monetary policies, and global events affecting the Japanese Yen.

Comparison to Industry Standards

• Comparable currency trusts include those tracking the Euro (FXE), British Pound (FXB), and Swiss Franc (FXF).
• The expense ratio of 0.40% is a key factor in comparing the cost-effectiveness of FXY against similar currency ETFs.
• Performance should be benchmarked against spot JPY/USD exchange rate movements and other JPY-based investment products.

Related Party Transactions

• The Trust pays Invesco Specialized Products, LLC, the Sponsor, a fee that accrues daily at an annual nominal rate of 0.40% of the Japanese Yen in the Trust.

Stakeholder Impact

• Shareholders are exposed to the risks and rewards of fluctuations in the Japanese Yen.
• Authorized Participants are responsible for the creation and redemption of Baskets.
• The Sponsor is responsible for managing the Trust and overseeing its service providers.

Key Dates

Keywords

Japanese Yen, CurrencyShares, Invesco, Trust, FXY, Exchange Traded Fund, Currency ETF, Financial Results, Foreign Exchange, Investment