Should I invest all my money in the Euro? Because the dollar is growing weaker and weaker per year.?

Question

Investments in Major foreign industrial powers in Europe, Australasia, and the Far East, known as the EFA.

Answer 1

I am not exactly certain whether you mean to convert your dollars to euros or whether you mean to invest in euro based companies and funds.

If you mean the latter, that would be an excellent move for a portion of your funds, maybe 25%.

Keep this in mind. If the dollar continues falling which is quite likely companies in the U S that export to foreign countries will be raking in the dinero hand over fist as they sell their product in high value currency countires and then repatriate it to the lowly U S dollar. Such companies as MSFT, MMM, JNJ, Boeing, CAT, Deer, etc.

One of my favorites as a non dollar play is SWZ. Another is TDF. Another is IIF.

Answer 2

If you are going to invest in the EURO mid term (6 months) I would say is a pretty good strategy.

I wouldnt just buy euro's outright and put them in a bank account.

Why not open a forex account and trade using that as your vehicle? That way you trade using leverage instead of a dollar for dollar purchase.

You can get up to 400:1 leverage using a forex broker (although I recommend no higher than 25:1 or maybe even 50:1 for long term trading). Then plan on it fluctuating in value day to day even week to week but the long term trends all show the euro going up significantly against the dollar. (especially if the US lowers their interest rates again or China shifts some more reserve currency away from the dollar to the euro).

I am way long on the EURO right now and happy that it retraced the last few days so I can get in at a better price.

I probably will scale out a portion of my position for each 100 points it goes up just to keep putting money in my pocket but if I was patient enough I am pretty sure the euro is a good 6 month to 1 year investment vehicle.

Answer 3

You can make money this way, by investing in foreign powers. However the Dollar and the Euro have a dynamic relationship that goes up and down.

If you are looking to invest long term, which is what most people should do, I think it is a great idea to invest in some foreign stocks. If you are looking to invest short term, who knows, there maybe a terrrorist attach in spain tomorrow that send the euro lower.

I can't tell you where to invest but people have made piles of cash using your stratagy, but people have lost money too.

Answer 4

Based on dollar exchange parity theories, the interest rate difference should be structured in such a way that you shouldn't be able to make a huge profit purely off a single long term currency exchange. Unless you're talking bout foreign company investments- and then you might still be regulated as to the max portfolio percentage you can invest internationally (I don't recall current rules and not sure where you live)

I guess you could consider euro-bonds.

Answer 5

If you think that the dollar is growing weaker, then make a play against the weak dollar. If you think that the Euro is getting stronger, then you need to invest in the Euro.

Here are a few weak dollar plays without having to invest in the Euro.

DBV - http://finance.yahoo.com/q?s=dbv

GLD - http://finance.yahoo.com/q?s=gld

Answer 6

No. Currency anywhere is never a good bet. It's a piece of paper looking to flatline. Check world history from 1796 to the presernt. It'll tell you loads.

Answer 7

To invest 100% into one thing is as risky as it gets.

Where did you get your analysis? Just an FYI, those e-mails you get are actually spam and illegal.

Answer 8

Never throw all your eggs into one basket. Check out Ben Stein's suggested strategy which sounds right up your alley:

http://finance.yahoo.com/columnist/article/yourlife/19423

Answer 9

All? .. no
Invest in international stocks, Funds
up and coming counties (Asia)

Answer 10

if your planning on moving to europe anytime soon