Carry trade
A carry trade means buying a high-interest currency against a low-interest one to collect the rate differential through the swap.
The idea: borrow in a low-yielding currency, as the yen was for many years, and invest in a higher-yielding one. In trading, you simply go long the relevant pair to collect a positive swap every night.
The income is steady, but currency risk dominates. When risk aversion rises, carry trades are unwound en masse and the low-yielding currency rallies sharply. Summer 2024 gave a striking example on the yen pairs.
A carry trade is never guaranteed income: a move of a few percent against you wipes out months of swaps.