Daily Investment Tips

Australian ETFs and New Zealand Dollar ETFs are a good fit for investors who are interested in commodity-tied currencies of Australia, New Zealand.

There is a direct correlation between commodities and currency, the higher commodity prices rise the higher a currency rises. This ahs been the case with Australian and New Zealand dollar: The currency have been rising on the global rise in commodities.

There are Australian ETFs and New Zealand Dollar ETFs that have been created to take advantage of this currency trends.

FXA – CurrencyShares Australian Dollar Trust

BNZ – WisdomTree Dreyfus New Zealand Dollar ETF

ADE – ELEMENTS Australian Dollar / USD Exchange Rate ETN

Australian and New Zealand Dollar ETFs

written by Constantine Njeru \\ tags: Australia, Australian Currency, Australian Dollar, Commodities, Commodity Prices, Currencies, Currency Trends, Etfs, Exchange Rate, Investors, New Zealand Dollar

There are several types of forex currency hedge funds. A Spot Forex currency hedge fund is not regulated by the SEC or the CFTC, and it offers investors a two day transaction time. A Forward Currency hedge fund is a fund where money is not traded until the specified future date has passed.

Other Types of Forex Currency Hedge Funds

Another popular forex currency hedge fund is the Swap Forex fund. Swap fund transactions are done between two parties that agree to trade two currencies with each other for a specific period of time. These currency transactions are not traded through an exchange, and standardized contracts are not used. Another basic forex hedge fund concept is the carry trade, which is one of the oldest strategies in finance. Carry trades occur when an investor borrows money in a currency with low interest rates, and invests it in another currency with high interest rates. Currency brokers realize that past trading patterns show that higher-yielding currencies maintain their exchange rate against lower-yielding currencies, and may even appreciate slightly, which allows the broker to pocket the difference in yields or what is known as the “carry.”

It is important to note forex currency trading is high risk investing. Before putting your money in any forex currency hedge funds, remember past performance is not and indicator of future performance.

written by Constantine Njeru \\ tags: Carry Trade, Currencies, Currency Brokers, Currency Trading, Currency Transactions, Exchange Rate, Forex Currency, Fund Transactions, Hedge Fund, Hedge Funds, High Interest Rates, High Risk, Low Interest Rates, Money Currency, Period Of Time, Spot Forex, Trades

One ETF that is designed to take a short position on the US dollar is the PowerShares DB U.S. Dollar Bearish Fund.

PowerShares DB U.S. Dollar Bearish Fund is issued and managed by Deutsche Bank and Amvescap unit PowerShares Capital Management LLC.

PowerShares DB U.S. Dollar Bearish Fund tracks Deutsche Bank U.S. Dollar Index Futures Index — Excess Return, which follows the movement of the U.S. dollar against a basket of six major currencies: the euro, the Japanese yen, the British pound, the Canadian dollar, the Swedish krona and the Swiss franc.

PowerShares DB U.S. Dollar Bearish Fund makes profit when the U.S. dollar falls.

written by Constantine Njeru \\ tags: British Pound, Canadian Dollar, Capital Management Llc, Currencies, Deutsche Bank, Dollar Index, Excess Return, Futures Index, Index Futures, Japanese Yen, Powershares, Short Position, Swedish Krona, Swiss Franc, Us Dollar

These days it is hard to find a currency analyst who is long US dollar, but thanks to Euro Crisis and natural calamities in Asia, the US Dollar is still able to hold its own against major currencies.

US Dollar ETF

For currency investors who still believe in the dollar they can purchase a dollar ETF that is long US Dollar.

PowerShares DB USD Index Bullish Fund

PowerShares DB USD Index Bullish Fund, The fund tracks the Deutsche Bank Long US Dollar Index (USDX) Futures benchmark which is a ruled-based index composed solely of long USDX futures contracts. The USDX futures contract is designed to replicate the performance of being long the US Dollar against the following currencies: Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona and Swiss Franc.

The PowerShare Bullish ETF makes money when the dollar rises against global currencies.

written by Constantine Njeru \\ tags: Benchmark, British Pound, Calamities In Asia, Canadian Dollar, Currencies, Currency, Deutsche Bank, Dollar Rises Against, Futures Contract, Futures Contracts, Global Currencies, Index Futures, Investors, Japanese Yen, Money, Natural Calamities, Swedish Krona, Swiss Franc, Us Dollar Index, Usd Index, Usdx

Australian Dollar hit a 29 years high against the US dollar in April 2011. The financial times of London is reporting: -

Short-term speculators have built up record bets on further gains in the Australian dollar, pushing the currency to fresh highs, as optimism over global growth and elevated commodity prices boost its appeal.

Factors driving Australian Dollar up

1. Currency speculators are buying Australian dollar contracts in record numbers. Data from the Chicago Mercantile Exchange,showed investors increased their bets on further gains in the Australian dollar to 90,938 contracts in the week to April 5.
2. Australia dollar is the highest yielding major currency. Investors are borrowing in US dollars, Yen and other major currencies and investing the money in Ausi dollars that is paying up to 4.75% annually.
3. Rising demand for Australian raw materials from China and India is also having an upward effect on Australian dollar.

Australian Dollar Forecast / Australian Dollar Prediction / Australian Dollar Outlook

With these factors all currency bets are the Australian dollar will continue to rise, at least in the short term.

written by Constantine Njeru \\ tags: Australia Dollar, Australian Currency, Australian Dollar, Australian Raw Materials, Bets, Chicago Mercantile Exchange, Commodity Prices, Currencies, Currency Speculators, Dollar Contracts, Dollar Outlook, Financial Times, Financial Times Of London, Global Growth, India, Investors, Optimism, Record Numbers, Times Of London, Yen

When it comes to Forex Currency Trading the regulator sets rules on the amount of leverage or margin allowed for trading.

The new rules set by the U.S. Commodity Futures Trading Commission, or CFTC rules prohibit retail forex dealers from offering more than 50-to-1 leverage for major currencies such as the dollar and the Japanese yen or 20-to-1 leverage for more-exotic currencies.

This rule protects forex currency traders from taking large risk that may lead to massive losses.

written by Constantine Njeru \\ tags: Cftc, Commodity Futures Trading, Commodity Futures Trading Commission, Commodity Trading, Currencies, Currency Traders, Currency Trading, Dollar And The Japanese Yen, Forex Dealers, Forex Traders, Forex Trading, Futures Trading Commission, Leverage, Massive Losses, Risk

Jim Rogers, a commodities guru and creator of the Rogers International Commodities Index, gave an interview to businessweek, giving his assessment of the ever rising gold price.

Jim Rogers Gold price prediction

Jim Rogers expects it to be over a couple thousand dollars an ounce sometime in the next decade.

Jim Rogers on what is driving the price of gold

• Demand from Central Banks, central banks which were selling gold a few years ago are now buying.
• The US Fiscal & Monetary Deficit – Throughout history, printing money has led to weaker currencies and higher prices for real assets.
• The Herd Mentality – Everyone is bullish about Gold and this is enough reason to drive prices up.

Read the whole Jim Rogers interview at this businessweek article.

written by Constantine Njeru \\ tags: Amp, Businessweek, Central Banks, Currencies, Gold Demand, Gold Price, Guru, Herd Mentality, International Commodities Index, Jim Rogers, Next Decade, Ounce, Price Of Gold, Printing Money, Real Assets, Rogers International Commodities Index, Thousand Dollars