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- CommentAuthorasafp
- CommentTimeJun 18th 2009
From Ron Rowland of the Weiss stable. I'm not sure, but I think he's new there. Replacing Jack Crooks?
"Diversify Out of the Dollar with Currency ETFs"
http://www.moneyandmarkets.com/diversify-out-of-the-dollar-with-currency-etfs-3-34246
I Want to Highlight One Other
Currency ETF Because It’s So Unique …
The PowerShares DB G10 Currency Harvest Fund (DBV) tracks an index that shifts exposure based on the yield of the ten top world currencies — the G10.
With DBV, you’ll have the equivalent of a long position in the three highest-yielding G10 currencies and a short position in the three lowest-yielding G10 currencies.
If you know anything about hedge funds, you probably recognize this as the so-called “carry trade.” Put simply, it’s borrowing at low interest rates and using the loan to buy higher yielding assets elsewhere. It was an easy way to make big bucks for years. But those managers had their heads handed to them in 2008.
Now it’s beginning to look like the carry trade may start to work again. If it does, DBV is an easy way for you to get access to the same strategy millionaire hedge fund investors are using.
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What do you Kings of Currency trading think about DBV? -
- CommentAuthorshredmonster
- CommentTimeJun 18th 2009
Outstanding. I will have to research the risk.
Maybe I am wrong but it seems like the guys making money in this climate are currency traders. Soros made a bundle. -
- CommentAuthorPatches
- CommentTimeJun 18th 2009
Thanks for the article asafp. There are no July options on these, but September option prices look good.
I've also heard the Japanese Yen is set to crash when the government goes bankrupt. The ETF for that is FXY. Option prices are pretty good on July puts.Thankful People: AllenMass -
- CommentAuthorslam608
- CommentTimeJun 18th 2009
The currency fund is also a component of the imitation hedge fund etf QAI which seems to have stayed flat even during the recent market run up. -
- CommentAuthorasafp
- CommentTimeJun 18th 2009
QAI has only been around less than 3 months. It's up 83 cents from the initial NAV of $25. Very interesting fund. I suspect you won't ever see huge gains here since it's invested in multiple strategeries. What I think will be really interesting is how well it holds up in a brutal bear market. Maybe we'll get to see that in 2009.
http://www.etfconnect.com/select/fundpages/etf_funds.asp?MFID=259400 -
- CommentAuthorstockcrazy10
- CommentTimeJun 18th 2009 edited
Please read the ENTIRE prospectus...here's a bit:
U.S. Shareholders
Treatment of Fund Income
A partnership does not incur U.S. federal income tax liability. Instead, each partner of a partnership is required to take into account its share of items of income, gain, loss, deduction and other items of the partnership. Accordingly, each Shareholder will be required to include in income its allocable share of the Fund’s income, gain, loss, deduction and other items (which includes the Fund’s share of the Master Fund’s income, gain, loss, deduction and other items) for the Fund’s taxable year ending with or within its taxable year. In computing a partner’s U.S. federal income tax liability, such items must be included, regardless of whether cash distributions are made by the partnership. Thus, Shareholders may be required to take into account taxable income without a corresponding current receipt of cash if the Master Fund generates taxable income but does not make cash distributions in an amount equal to such taxable income, or if the Shareholder is not able to deduct, in
whole or in part, such Shareholder’s allocable share of the Fund’s or the Master Fund’s expenses or capital losses. The Fund’s and the Master Fund’s taxable year will end on December 31 unless otherwise required by law. The Fund and the Master
Fund will use the accrual method of accounting.
Deutsche Bank Powershares funds have tax consequences even when they're held in a retirement account. The DB reps will be happy to explain these to you.
Important Considerations
• Commodities and futures generally are volatile and are not suitable for all investors. The Fund will be successful only if significant losses are avoided. Funds focusing on a single sector generally experience greater volatility. Please review the prospectus for break-even figures for the Fund.
• The Fund is speculative and involves a high degree of risk. An investor may lose all or substantially all of an investment in the Fund.Thankful People: Patches -
- CommentAuthorshredmonster
- CommentTimeJun 18th 2009
Gulp! -
- CommentAuthordharouff
- CommentTimeJun 18th 2009
How about UUP UDN, haven't researched them just noticed them last night -
- CommentAuthorstockcrazy10
- CommentTimeJun 18th 2009
Farley's mentioned UUP/UDN in the past, but I haven't researched them -
- CommentAuthordmanson
- CommentTimeJun 18th 2009
That DBV looks very interesting. Has anyone here owned it? I'd be interested to know how they did. Theoretically, if the managers did a good job, you shouldn't really lose because some currency is always going up in relation to another. -
- CommentAuthordcarlson
- CommentTimeJun 19th 2009
I've made some money in DBV, I think it was a year to 18 months ago. It seemed like a pretty safe place to be but I sold because it went up about 20% if I remember correctly. Seems to me it might be a pretty good place to be right now. -
- CommentAuthordestry
- CommentTimeJun 19th 2009
I want to like it...I've watched it.....However, the currency mix is updated on a quarterly basis.
I feel it's always a day late and a dollar short....You should pardon the expression.....
And the currency choices may not be the best from which to choose.Thankful People: stockcrazy10 -
- CommentAuthorspreadtrader
- CommentTimeJun 20th 2009
If you want to play the currency game to "not lose" (and only when the dollar is going down) then buy CYB........of course, it doesn't account for inflation, but look at the chart. It has fluctuated $1 per share in the last year.
If you want to win trading currencies, there's an easy way to do this, eh? Just compare some charts and run the numbers.
If you do that you'll see that UDN (the bearish dollar fund) is up about 11% from its winter low; DBV (the watered down basket of currencies) is up about 16%; and FXA (the high flyer suggested by yours truly months ago [sorry, couldn't help it]) is up 23% from its low.
Personally, I wouldn't ever trade UDN or UUP. It's like, well, it's like the thrill Hugh "Duffy" Daugherty used to get when he kissed his sister.
I wouldn't trade BVD's either....OK, DBV........it's like eating oatmeal with no brown sugar.
Give me a list of currencies with some volatility and their charts anyday.
BUT......that's me. Some investors may want to park their cash someplace safe and not look at it......much. -
- CommentAuthordestry
- CommentTimeJun 20th 2009
The way I choose to play strong currencies; Is to do so through that country's stocks....
Best example is the Norwegian Krona....One cannot buy an ETF for Norway, or it's currency
except on the Norwegian exchange...And at that, Norway is thinly traded any way you want to slice it.....Except for some of it's stocks.
You have the added burden of the underlying stock itself...
"Yara" (Fertilizer), is a bad choice right now, as a surrogate for the "N Krona"....
Statoil is the preferred choice...Regardless, this method is , of course, not a pure currency play...
And worse; You have to be right twice in a row....Currency....And the choice of the underlying stock.
"No one is ever right,twice in a row"......Well...Hardly ever...Thankful People: dharouff, spreadtrader
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