Foreign Currency

[dochoov]

What's the easiest way to invest in foreign currency?

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[etf]

just don't. please.

 

[The White Coat Investor]

What's the easiest way to invest in foreign currency?

If you have to ask, you shouldn't be doing it. Actually, no one should be doing it.

But, what you might have meant to ask is how can you protect yourself from possible devaluation of the dollar. The best way to do this is to have a significant portion of your stocks be international (non-US) stocks, such as through a good index mutual fund such as Fidelity Spartan International Index Fund (that one was for you ETF) or Vanguard Total International Index Fund. That way, if the yen or the euro strengthens against the dollar, you'll be rewarded with higher returns on this fund (and vice versa, of course.)

 

[AKPsiMD84]

You can take short and long positions against the dollar so you can make money off of a devaluating dollar.

As for an easy way to invest in currency, there is none. You got to learn about investing in currencies and gain experience by investing and this takes time. Luckily many currency broker firms have demo programs so you can try out their programs with play money first before actually investing with real money.

A good website to learn about FOREX trading is www.babypips.com

 

[The White Coat Investor]

You can take short and long positions against the dollar so you can make money off of a devaluating dollar.

As for an easy way to invest in currency, there is none. You got to learn about investing in currencies and gain experience by investing and this takes time. Luckily many currency broker firms have demo programs so you can try out their programs with play money first before actually investing with real money.

A good website to learn about FOREX trading is www.babypips.com

What is your long-term record trading currency? Did your after-tax, after-expense return for any significant period of time even beat T-bills?

Dollars not only devaluate, but also strengthen. Private individuals have no business betting on currencies, especially those who are reasonably intelligent and prone to overconfidence (like doctors and med students.) Do you really think you know more than the collective market? Do you really think you can react faster than big companies with an entire room full of currency trading experts glued to their screens looking for the slightest arbitrage opportunity?

Like gambling in a casino is a loser's game (because the house always takes a cut) so also is currency trading (because there are expenses involved.) This is not like investing in a stock where wealth is generally created. This is just swapping wealth around hoping to get lucky at someone else's expense.

 

[etf]

Do you really think you can react faster than big companies with an entire room full of currency trading experts glued to their screens looking for the slightest arbitrage opportunity?
.

the day i stopped daytrading was a few days after my brother started working at a top investment bank and told me of these rooms. they have access to $15,000/month bloomberg screens, while all i have is yahoo finance. the only way i can win is by focusing on the long term, something that professional traders don't have the luxury of doing. and i'm trying...

 

[AKPsiMD84]

What is your long-term record trading currency? Did your after-tax, after-expense return for any significant period of time even beat T-bills?

Dollars not only devaluate, but also strengthen. Private individuals have no business betting on currencies, especially those who are reasonably intelligent and prone to overconfidence (like doctors and med students.) Do you really think you know more than the collective market? Do you really think you can react faster than big companies with an entire room full of currency trading experts glued to their screens looking for the slightest arbitrage opportunity?

Like gambling in a casino is a loser's game (because the house always takes a cut) so also is currency trading (because there are expenses involved.) This is not like investing in a stock where wealth is generally created. This is just swapping wealth around hoping to get lucky at someone else's expense.

I have no record. I only answered the person's question to the best of my ability and the one thing I know: You work at sonething long enough and pay attention you get good at it. To get to that point you need knowledge, practice and a bit of common sense to know that you don't have to approach something like currency trading from a gambler's point of view. We're in the Information Age and there are plenty of sources of learning. Companies have demo programs so that the potential client can get as much practice before doing the real thing, its better then nothing.
BTW: currency trading expenses are relatively low and are already calculated in the price of trading, its called the bid-ask spread. Buy at one price and sell at another and usually by a difference of .002-.005 units of currency.
BTW2: Relax... Im not saying to destroy and beat the big institutional investors. You don't have to beat them to make money either.