The implied volatility of ATM contracts for near month expiries of this the pair has been inching higher from 8.5% for 1w expiry to 9.5% for 1m expiry.

NPV of 1w ATM call is 46032.85 while premiums trading above 20.33% at JPY 59391.83 for lot size 100,000 units.

NPV of 1w ATM put is 46437.06 while premiums trading above 20.18% at JPY 55809.80 for lot size 100,000 units.

Hence, comparing this difference in options premium with implied volatility and market upward sentiments we think the hedging cost for upside risks would not be economical as result of deploying ATM instruments.

Contemplating that factor we cannot afford to remain stuck in this riddle without hedging, so what's the alternative, in forwards markets at least..?, subsequently, here comes the strategy arbitrage strategy in which options trading that can be performed for a riskless profit as USDJPY ATM call options are overpriced relative to the underlying exchange rate of USDJPY.

To perform this conversion, the hedger holds the underlying spot FX and offset it with an equivalent synthetic short spot FX (long put + short call) position.

Profit is locked in immediately when the conversion is done, the profit would be strike price of call/put - purchase price of underlying + call premium - put premium.