For decades, carry traders have borrowed US dollars at low interest rates and invested in higher-yielding emerging-market currencies. But that flow is now getting turned on its head. The Federal Reserve’s tight monetary stance has extended for so long that some emerging economies are struggling to keep their yields competitive, making them the target of a so-called reverse carry trade. That trade is paying off. Borrowing in emerging-market currencies and buying the dollar has produced returns of as much as 9% this year. The Chinese yuan, Thai baht, Malaysian ringgit and even Czech koruna are some of the currencies ... (full story)