After decades of working in financial markets I just can’t think of GBP as real money at all.
currency risk
The Brexit trade deal, vaccines, and Joe Biden in the White House are all good for the pound but what about your portfolio?
People get currency risk very wrong, so here’s an article to put us all right. I’ll warn you now it contains some maths – but it’s very simple maths!
This thought-provoking guest post is by Andrew Henderson, the author of Nomad Capitalist. Even when you have discovered the freedom of expat life, chances are that you will still need to process the transition. It can feel a bit like a home-country detox. This is more than just dealing with cultural shock. In many cases, [...]
Opting for a currency hedged US S&P 500 tracker over a standard ETF doubled your return in 2017. What’s the catch?
Spooked by the soaraway pound? Not entirely comfortable with seeing your portfolio bounce 20% up or down with currencies? ETFs offer a solution…
Currency risk arises from exchange rate moves between pairs of currencies. If you have investments or assets in a foreign country with a different currency, you face currency risk, unless the foreign currency is pegged to your domestic currency or your exposure is hedged. A simple example shows how currency risk affects your returns. Suppose [...]
Spreading your money overseas as liberally as any colonial power ever did means you reduce all sorts of risks when investing in shares, provided you’ve a long-term horizon.
(Source: Yahoo) Books on investment often suggest investing overseas as a method of diversifying your portfolio. There are several reasons why investing abroad can be a good idea, including: If one country or region’s market is doing badly, another could be doing well. Mixing up the returns from several regions helps to smooth the return [...]