2011/4/23

Invest in Asian currencies is more complicated than it seems

Besides the economic slump in Western countries, Asia World maintains growth tips of arms. Buy Asian currencies is a good idea, but it's more complicated than you might think.
Indeed, few ETF trackent currencies in Asia and there are also some coins on the market. Many products are based on currency derivatives and their structure does not allow them to achieve the performance expected. Once the costs taken into account, you can lose money even if the yuan rises a little example.
Bond funds in local currencies to diversify its basket. But there still remain problems. Own bonds do just forced to watch the currency. Your profits depend on other factors such as interest rates, inflation risk or the credit crunch. Factors that affect bond prices.
To begin, we recommend for example the fund of Aberdeen Asset Management, a manager specializing in equity which has launched a bid bond in the Asian market. This fund helps to have a diversified basket of currencies and play on the exchange rate of one currency to another Asian.