BeeBop does UK

[GTM 3442]

Thanks give us a heads when the timing and exchange rate are right.

Currently:

CU71.L on Yahoo! at GBP103.49
IBTL.L on Yahoo! at GBP4.1133
GBP/USD on Yahoo! at USD1.2837

You now have the data, human - time to take a deep breath and enter the matrix. . . .

[GTM 3442]

Thanks give us a heads when the timing and exchange rate are right.

Currently:

CU71.L on Yahoo! at GBP103.49
IBTL.L on Yahoo! at GBP4.1133
GBP/USD on Yahoo! at USD1.2837

You now have the data, human - time to take a deep breath and enter the matrix. . . .

[Toulouse - Luzern]

Like you, BeeBop, I have a use (a need even) for pounds for use in the UK .

So, having decided that I’m going to have pounds, the question becomes where do I hold those pounds as they accumulate...


The exchange rate is important

I know the average value of my pounds in USD, and it’s relatively easy to construct a matrix of fund price and exchange rate which you can plug into a spreadsheet to tell you the effect of the combination of exchange rate movements and fund prices, which gives you entry, accumulate, decumulate, and exit points. After all, if the GBP/USD goes from (say) 1.21 to 1.29, your fund is worth a whole lot fewer pounds!


GBP/USD rises, Fund price rises
GBP/USD rises, Fund price falls
GBP/USD falls, Fund price rises
GBP/USD falls, Fund price falls

So to summarize – pick your asset class, pick your duration, pick your vehicle, and work out what the effect of currency movements will be, and do daily data entry.

And never forget that timing and exchange rate are incredibly important

Looking at the matrix, it does not look correct.

What do you think.

[GTM 3442]

Looking at the matrix, it does not look correct.

What do you think.

Dunno.

My immediate concern is with the result of the upcoming UK election, and whether to buy the FTSE in dollars, the S&P in pounds, or to sit on my hands until B-Day.

[GTM 3442]

Well, I had a short detour to look at Brazil, but the rocketing IBOVESPA is balanced by the plunging real, so no, nothing to see here, move along please.

In the UK, with the strengthening pound, it seems as if a short-term punt on the FTSE100 in an ETF denominated in USD is in order.

I'm anticipating a Conservative victory in the election with a small but workable majority, and a subsequent euphoric rally in the FTSE and the GBP.

Fingers crossed.

On the other side of the world, the Australian bank term deposits are coming due, but the current Australian TD rates aren't worth having. So I think I'll ship the AUD to Luxembourg and put them into an Australian government bond ETF. No change to the asset allocation, no change to the currency diversification either. And with the RBA looking likely to cut rather than hold the equivalent of the OCR, there's the possibiity of a small uptick in price.