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Question about hedging against Dollar Decline vs Euro, please help total Newb

Discussion in 'Beginners Bootcamp' started by shterenta, Oct 21, 2009.

  1. shterenta

    shterenta Recruit

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    Hi

    I am new to this, I am not interested per se in active trading of currencies. However, I am interested in hedging against dollar decline via purchase of Euros, Yen and Swiss Franks and possibly Australian Dollar. Either a basked of these or possibly only Euros.

    My business has presence in Eastern Europe where Dollar is king but Euro is gaining. My fear is that with what's happening to USD daily, the Euro will overtake USD position. I want to hedge against this.

    My question is this, should I simply purchase Euros in the forex market and just hold them as a hedge or should I purchase FXE fund or something of that sort? Sorry, I am just not familiar with this and that's why I would appreciate any expert advice.

    Holding period would be about 1 year roughly and sum about $50-$75K.

    Also, which broker would you recommend for this type of setup?

    Thanks in advance.
     
  2. Rubin Hood

    Rubin Hood Private

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    The EUR has come a long way and one of these days will probably be a turnaround for the USD. You might want to consider leaving the sum in USD for the next several months. Then by the time the media has convinced you that the EUR will fall "forever", that will be the time to switch to it.
     
  3. Lhar_fpa

    Lhar_fpa Private, 1st Class

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    What analysis are you using? Because I think it affects the currency that you are trading:p
     
  4. Cyclon

    Cyclon Company Representative

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    Make that 2


    I agree with Rubin and would hope you consider such advice.

    Cheers,
    Cyclon
     

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