Hedging yourself against the falling dollar

Discussion in 'Trading' started by Sky123987, Apr 13, 2008.

  1. If you buy say an ETF say for the UK is that hedged against the dollar?

    My thinking is no because I bought the ETF in dollars. But then in if the ETF is invested in companies in the UK and they are making money in pounds. If the dollar falls then the value goes up right??
  2. another question is what is the safest way to hedge against hte dollar?

    Can I go to europe, buy $20K Euros and put them in a european bank and collect interest?
  3. i was just wondering... if you buy an UK etf and the pound rallies against the dollar what effect does that have on the etf?
  4. piezoe


    If you wanted to do that, that would be a very expensive way to open an account in Euros. Why not open an account at a US bank that specializes in foreign exchange, like Everbank, for example. Wouldn't that be easier and less expensive?

    There is also the Lehman International Treasury Bond ETF.

    And there are many other possibilities. If you like the pound you could accumulate a position in Diageo (DEO). nice dividend and drinking ought to pick up as the recession worsens.

    If you like the Krone (that's one i like) why not invest in STO and Norsk Hydro for example.

    If you like the Swiss Franc there is always Roche.

    Many, many possibilities for hedging the US dollar. But i guess i did not answer your real question which was what is the safest way to hedge against the US dollar. Sorry, but i don't know the answer to that one, but of the choices i gave above i suppose the Lehman ETF would be the safest. Or probably best choice in the long run would be to vote the spend and borrow and print Republicans out of office.:D
  5. What about switching the base currency for your account to something other than the dollar? What are the downsides to this? I've been considering it.