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  #11  
Old 12-11-2019, 11:44 AM
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Originally Posted by Colymbosathon ecplecticos View Post
Why would FX be diversifiable? If I'm in one foreign currency or a million, if the dollar goes up, I have a loss.
The dollar usually doesn't move uniformly with respect to all currencies. e.g. the dollar to GBP rate will move differently than the dollar to EUR rate.
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Old 12-11-2019, 12:02 PM
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The dollar usually doesn't move uniformly with respect to all currencies. e.g. the dollar to GBP rate will move differently than the dollar to EUR rate.
But the direction will almost always be the same.
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  #13  
Old 12-11-2019, 01:01 PM
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But the direction will almost always be the same.
My base currency isn't USD so I'm less concerned about serial correlation.
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  #14  
Old 12-11-2019, 02:46 PM
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Lol, well obviously otherwise everyone and their mother would be piling into EMD Local. We typically advise our clients (institutions) to do a 50/50 blend between external and local EMD. Personally, I don't like to add additional risks to one type of investment. For EMD, why add the currency risk. If you want currency exposure then take explicit forex exposure.
I'm rethinking you're point here, and I'm warming too it. If fundamentally I believe interest rate parity won't hold, which would allow me to profit of foreign debt, I could get the same profit playing the other side of the FX trade more directly.
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Old 12-11-2019, 06:17 PM
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My base currency isn't USD so I'm less concerned about serial correlation.
I donít think it matters what your base currency is, if the base currency strengthens, youíll suffer a loss.
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  #16  
Old 12-11-2019, 06:53 PM
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I donít think it matters what your base currency is, if the base currency strengthens, youíll suffer a loss.
Most of the external EM debt is denominated in USD so yes, it does matter.
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Old 01-12-2020, 06:52 PM
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Maybe get a term deposit here for some of it...
https://www.fnb.co.za/for-me/save-an...vestments.html

Though, not sure how local income tax gets dealt with...
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  #18  
Old 01-12-2020, 07:06 PM
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I'm finding this option intriguing. It looks like one thing you could do is invest in a developing markets government bond etf. I'm seeing a few options for local government and national governments. EBND has a 4.68% dividend.

Some options...
https://www.investopedia.com/article...-bond-etfs.asp
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