Hello, Does anyone on the forum know the mechanics of “toushin” funds? These funds, very popular among retail investors in Japan, have a portfolio of (usually USD denominated high yield) bonds, and a foreign currency swap overlay, where the portfolio manager sells USD vs. chosen currency exposure. The FX overlay is supposed to enhance the overall yield on the portfolio, while transferring the FX-related risks to the investors. The most popular foreign currencies are BRL, AUD, and ZAR, but there is an increasing tendency towards Asian currencies. What I would like to know is the mechanics of setting up and managing these kind of funds, such as what’s the notional of the swap overlay at the inception, how often are the funds rebalanced, what kind of swaps are usually used (the tenor, etc). Would appreciate if anyone can share their knowledge on this delicate topic. Thanks!