Right now my portfolio (separate from my trading account) consists of all cash. I went from stocks to cash in early March of 2007, I have not bought anything since then. I consider myself very lucky. I am betting stocks will continue their decline, and will not be getting into stocks right now. However, I am not satisfied holding U.S. dollars. I am thinking about moving to swiss francs with the etf fxf, and waiting for a dip on gold. I plan to buy fxf today, but would like to hear some opinions?
I would be careful holding swiss franc's since they are looking to devalue just like the next central bank. That being said, they are way more concerned with EURCHF than USDCHF. http://www.bloomberg.com/apps/news?pid=20601085&sid=al8uYPZzDobU&refer=europe Your safest bet likely remains the yen, but there is obviously intervention risk there as well. They can only sit back and watch their exports dry up for so long before they make a real effort to depreciate. In my opinion no currency is safe at this point. I am long gold and will look to add on pullbacks. It is holding up well in a deflationary environment and is also breaking out in terms of EUR and GBP. I also own a bit of oil from down here but, remain cautious given global demand looks likely to continue to crater. If you believe the dollar is headed in a downward spiral, you could always get short treasuries via the various ETF's
Thanks for the great advice, a lot more than I had hoped for. Before reading your post I called and put about 25% in fxf; I don't know if I will keep it though. I will do some planning the next few days for the rest of the portfolio, and ill keep the thread updated. Thank you.
Let's be real, the Yen gets inflated like the rest. You're talking about a nation who was lending out money at 0%. The Swiss Franc is a better bet, although, it has been a total fiat since 2002 or 2005. Real assets is where it's at. Gold, silver, food, energy generation and water. Oh, don't forget alcohol.
Instead of outright converting to another currency, how about buying options on other currencies? That way you'll have more flexibility to keep your holdings or convert later on.
Short the Dollar Index futures (link-1), (link-2). This is a basket whose weights are: Euro = 57.6% JYen = 13.6% UKPound = 11.9% CanDollar = 9.1% SwedishKroner = 4.2% SwissFranc = 3.6%
go home! and i am serious. the rule number one in currency exposure is if you don't know for sure (which you almost never do) you should match your payables with receivables. for instance if you are US based you should stay in the US dollar and protect against debasement via different channels, e.g. buy gold or sell treasuries as somebody already suggested.
Everbank has some great products to limit your exposure to the dollar. CD's based in different currencies etc. etc.... lots of different options... www.everbank.com
Dold is holding up well in a deflationary environment because it is being propped up by investor fear. That is not a solid foundation.