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Start a Hedge Fund in Currencies Now!

28 February 2008 - Features - Editor

You need not indulge in any unduly aggressive investing to deal with dollar, Euro, and RMB market conditions of 2008. A bank would typically employ an army of specialists to decide on short-selling, leverage, swaps, and other derivatives. The risks are not worthwhile from your individual stand-point because the market could take turns very differently from what people predict at this point of time.

Shipping is a typical example of things can change very quickly in a global market place. The US economy is not growing as quickly as in many other parts of the world. That could be one of the reasons for more shipping taking place between Asia and the Middle East, than to and from North America. However, the container traffic could swing very quickly if droughts in various parts of the world ramp up demand for grain from the US and Canada.

It is the same with the dollar. We could see better budgeting in Washington under a new President. The Chinese may finally yield some ground with their currency manipulations. Domestic markets in Europe may not sustain their high currency value. Alternative energy and defense exports could also see a strengthening of the dollar.

You might not want to get in to full-scale hedge fund operations, but here are a few things that you can do for protection against the current dollar trend:

  • Negotiate early payment discounts for anything you need to buy from abroad during the course of the next one year. A vacation in Italy would be an example. Ask your bank to buy foreign currencies for your foreign purchases if you cannot pay early.
  • Take a look at our publication on this web site entitled ’Can a Made in USA Financial Planning Strategy save US from Recession’. Drop all the foreign goods you can from your house budget. French wine is an example! What a great way to re-discover California!
  • Start an online business aimed at the European Union. The popularity of our soaps and stars says that there is a demand for Americana on the other side of the Atlantic!
  • Buy stock of companies that market goods and services abroad. Take a look at our article entitled ‘A Stock that Looks Inside Young Minds’ to get your own ideas flowing.

Speaking about ideas, can we lean on your hedge fund expertise? Join our forum and tell our community all about swaps, derivatives, and how to make big gains on small margins. Risk management will be a key part of dialog on this tough subject. We wait to hear from you!

 


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