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Investing In Currencies Other Than Sterling

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Got cash in the bank (sterling) and I am very concerned that the pound is likely to take a tumble. Australian and Canadian dollars look tempting / more reliable. I have also read a bit about the Norwegian Krone. Euro and US dollars both appear to have issues, but could be a hedge against a big fall in the pound.

I am trying to protect the value of my pounds...and maybe make a little bit....or a big bit if the £ tanks.

Iwould appreciate advice on several counts:

Any thoughts re the choice of currencies? What would you buy?

Is it easy to get interest bearing accounts from UK banks?

Do you still get the protection of Govt savings guarantees in currency accounts?

Can you get bonds in foreign currencies...How?

Other recommended investments that might be worth considering for a balanced and fairly secure home for my wealth?

Interested to hear your thoughts. Thanks in advance.

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HSBC recently said that the Krone will be the safest currency in the world over the coming years.

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I did a poll on here a while back asking what currencies to move into if you had to. I plan to bring this up in exactly a year to see what would have panned out.

Nothing wrong with spreading your savings in different currencies. However it should be as a hedge and nothing more IMO. Otherwise you are simply speculating on currency - which is deemed by most to be one of the most risky strategies out there.

So if planning to diversify - choose a few you like - start paying into them and most imporantly IGNORE WHAT HAPPENS TO THE EXHANGE RATE.

Otherwise - you are just speculating, and may well get seriously burnt.

I am still not sure whether to diversify myself. Really stuck in a quandry with this one.

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Got cash in the bank (sterling) and I am very concerned that the pound is likely to take a tumble. Australian and Canadian dollars look tempting / more reliable. I have also read a bit about the Norwegian Krone. Euro and US dollars both appear to have issues, but could be a hedge against a big fall in the pound.

I am trying to protect the value of my pounds...and maybe make a little bit....or a big bit if the £ tanks.

Iwould appreciate advice on several counts:

Any thoughts re the choice of currencies? What would you buy?

Is it easy to get interest bearing accounts from UK banks?

Do you still get the protection of Govt savings guarantees in currency accounts?

Can you get bonds in foreign currencies...How?

Other recommended investments that might be worth considering for a balanced and fairly secure home for my wealth?

Interested to hear your thoughts. Thanks in advance.

h'mmm, now let me think......h'mmm, surely there must be a golden opportunity somewhere or a silver lining. :D

Edited by grumpy-old-man-returns

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I did a poll on here a while back asking what currencies to move into if you had to. I plan to bring this up in exactly a year to see what would have panned out.

Nothing wrong with spreading your savings in different currencies. However it should be as a hedge and nothing more IMO. Otherwise you are simply speculating on currency - which is deemed by most to be one of the most risky strategies out there.

So if planning to diversify - choose a few you like - start paying into them and most imporantly IGNORE WHAT HAPPENS TO THE EXHANGE RATE.

Otherwise - you are just speculating, and may well get seriously burnt.

I am still not sure whether to diversify myself. Really stuck in a quandry with this one.

Is it possible to get an interest paying savings account or are you just moving the capital into another currency at the available exchange rate and leaving it there in a current account effectively?

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I did wonder how long for them to get a mention. Buy physical?

I am sure buying gold would have been a great idea when Gordon sold ours at under 300. Now at $900 ish, is it still?

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Cheers MOP...Who would I open a krone savings account with though?

Funningly enough - you can open one with HSBC - service charges and probably zero interest. Always a catch. :rolleyes:

You have to remember you will lose out by the following:

1) No interest. Interest is not great in £ but you can get 2-3% quite easy.

2) Service charges.

3) Spread when changing between currencies (No idea what this actually is for bank account in foreign currency ?)

So if you plan to diversify - you are probably 5-10% worse off immediately. Fair enough if the currency you choose appreciates againt the £ by 40%. Great.

However if it stays roughly the same or even depreciates ? Far from great. This is why I am not sure whether to do it myself.

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Is it possible to get an interest paying savings account or are you just moving the capital into another currency at the available exchange rate and leaving it there in a current account effectively?

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Funningly enough - you can open one with HSBC - service charges and probably zero interest. Always a catch. :rolleyes:

You have to remember you will lose out by the following:

1) No interest. Interest is not great in £ but you can get 2-3% quite easy.

2) Service charges.

3) Spread when changing between currencies (No idea what this actually is for bank account in foreign currency ?)

So if you plan to diversify - you are probably 5-10% worse off immediately. Fair enough if the currency you choose appreciates againt the £ by 40%. Great.

However if it stays roughly the same or even depreciates ? Far from great. This is why I am not sure whether to do it myself.

My other worry is that at close to record historic lows against other currencies, unless we suffer total state / currency failure etc, the £ might not fall much further....certainly against $ and euro.

If the next leg down is nasty however and the dollar and Euro join us in the gutter, then what is the best hedge?

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My current thinking is probably:

Sterling savings 20%

Premium bonds 20% (ask the wife)

Heavy stuff 20%

Nor Krone 20%

Oz or NZ dollars 20%

Too many different currency accounts would involve too much in fees. Should I look at other currencies. If so which?

Is the £ as low as it is likely to go (sorry BXLONDONMAN) and should I stay in sterling?

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My other worry is that at close to record historic lows against other currencies, unless we suffer total state / currency failure etc, the £ might not fall much further....certainly against $ and euro.

If the next leg down is nasty however and the dollar and Euro join us in the gutter, then what is the best hedge?

Look at what happened to the £ in the last 6 months. Al talk of doom and collapse, QE on a huge scale- and it shoots up :blink:

Really is too much for us chumps to work out. Even the big boys have no clue IMO.

I suppose the best hedge is to get maybe 6 acconts in totally different currencies. SOme linked to commodity rich countries. Some in Asia, some Europe etc...

Then you can be pretty sure you are covering most eventualities. It probably wont appreciate much, but then you wont depreciate either. You will have fees to pay, no/very low interest and the loss of the spread to consider. Then again if it is a hedge - then who cares.

Pound

Dollar

Euro

Oz

Japanese

Brazil Real

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Look at what happened to the £ in the last 6 months. Al talk of doom and collapse, QE on a huge scale- and it shoots up :blink:

Really is too much for us chumps to work out. Even the big boys have no clue IMO.

I suppose the best hedge is to get maybe 6 acconts in totally different currencies. SOme linked to commodity rich countries. Some in Asia, some Europe etc...

Then you can be pretty sure you are covering most eventualities. It probably wont appreciate much, but then you wont depreciate either. You will have fees to pay, no/very low interest and the loss of the spread to consider. Then again if it is a hedge - then who cares.

Pound

Dollar

Euro

Oz

Japanese

Brazil Real

Can you buy into a mixed currency fund like this? It would save the fees etc on holding separate accounts.

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My other worry is that at close to record historic lows against other currencies, unless we suffer total state / currency failure etc, the £ might not fall much further....certainly against $ and euro.

If the next leg down is nasty however and the dollar and Euro join us in the gutter, then what is the best hedge?

grumpy old man already mentioned them both.

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If you opened an account for online share dealing with a firm that offers stock dealing in different countries couldn't you hold money there in diffrerent currencies ready for trading you might never do?

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If you opened an account for online share dealing with a firm that offers stock dealing in different countries couldn't you hold money there in diffrerent currencies ready for trading you might never do?

Cunning.....But how secure is it?

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Look at what happened to the £ in the last 6 months. Al talk of doom and collapse, QE on a huge scale- and it shoots up :blink:

Really is too much for us chumps to work out. Even the big boys have no clue IMO.

I suppose the best hedge is to get maybe 6 acconts in totally different currencies. SOme linked to commodity rich countries. Some in Asia, some Europe etc...

Then you can be pretty sure you are covering most eventualities. It probably wont appreciate much, but then you wont depreciate either. You will have fees to pay, no/very low interest and the loss of the spread to consider. Then again if it is a hedge - then who cares.

Pound

Dollar

Euro

Oz

Japanese

Brazil Real

The Real and the AUS are really just commodity plays

Why not just buy a commodity tracking ETF and something like the Vanguard Global aggregate bond fund to get exposure to Euro/Dollar/Yen?

Alternatively I think ishares do short dated Euro and Dollar treasury funds...

Simples...

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My other worry is that at close to record historic lows against other currencies, unless we suffer total state / currency failure etc, the £ might not fall much further....certainly against $ and euro.

If the next leg down is nasty however and the dollar and Euro join us in the gutter, then what is the best hedge?

Pwoperdee! Buy houses!

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Got cash in the bank (sterling) and I am very concerned that the pound is likely to take a tumble. Australian and Canadian dollars look tempting / more reliable. I have also read a bit about the Norwegian Krone. Euro and US dollars both appear to have issues, but could be a hedge against a big fall in the pound.

I am trying to protect the value of my pounds...and maybe make a little bit....or a big bit if the £ tanks.

Iwould appreciate advice on several counts:

Any thoughts re the choice of currencies? What would you buy?

Is it easy to get interest bearing accounts from UK banks?

Do you still get the protection of Govt savings guarantees in currency accounts?

Can you get bonds in foreign currencies...How?

Other recommended investments that might be worth considering for a balanced and fairly secure home for my wealth?

Interested to hear your thoughts. Thanks in advance.

Zloty is still rising and is fundamentally undervalued.

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My other worry is that at close to record historic lows against other currencies, unless we suffer total state / currency failure etc, the £ might not fall much further....certainly against $ and euro.

If the next leg down is nasty however and the dollar and Euro join us in the gutter, then what is the best hedge?

Historic low??

Pound reached near parity with the dollar in the past. $1.65 is bang on average.

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When I wanted to get out of Sterling (a bit) I went looking for stock funds in industries I thought would do well that made all or most of their investment outside the UK, in countries whose currencies I thought would do well against Sterling.

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