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Old 2005-12-19, 11:55   Link #9
Rurik
Golden
 
 
Join Date: Jul 2004
Location: 9th Temple
Age: 45
The problem with Currency investing, as some have noted is the fluctuation of the currency value, this market is very volatile, and normally investor do not do this kind of thing, they usually make their investment in a more commercial currency the most common the USD. However it is normally a low risk investment if you know what currency you are buying, and is just for short time comitment.

What people do is buy specific amounts of other currency for short term commitment and /or Payments to international vendors, some say it is less risky investing in the Stock exchange rather that buy thousands of a currency to save it.

Yet, If you have insiders that can tell you how the market will flow you can gain a couple of buck by it, a good example is the country where I’m from, where the currency devaluates often, so people buy large amount of USD, and wait for the currency to devaluate, we are talking about a 2 or 3 point gain.

The problem with this is that when a currency start devaluating in comparison to the USD (USD is consider the world #1 commercial instrument and more than 50% of intertanional comerce is done with this currency) this means that the local commercial value this currency holds is less than before. Even if Yen is having a gain in comparison to the USD, still USD has a much higher commercial value..Heck, it would be less risky to try and do it with Euros due to the fact that Euro is a more commercial currency than the YEN.
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