Follow the lead set by emerging market currencies. The flow into and out of emerging market currencies tells you so much about the mood of world financial markets as a whole. This is based on experience in trading emerging market currencies and bonds for over 15 years. We have noticed that a number of emerging market currencies have broken to new highs not only against the USD but also against the Euro. To us this suggests that the smart money (for want of a better term) is pricing in higher than expected world growth, commodity prices and no doubt inflation. This trend appears very healthy and is supported/reinforced by stronger emerging market bond prices. We think that emerging market currencies are in the process of reclaiming back the losses suffered in Sept/October last year and they are likely to reclaim all the losses by the end of this year. Thereafter what happens? We have no idea, but we do know that an object in motion tends to stay in motion. While emerging market currencies continue to make new highs against the USD and Euro who are we to question when the trend is about to come to an end.
USD Turkish Lira Spot
USD Russian Ruble Spot
USD Indian Rupee Spot
USD Brazilian Real Spot
Our global wealth builder portfolio (Earnslaw), which consists of just 12 ETFs and is the vehicle with which we manage our retirement funds, is up 27% since the start of the year. Subscribers are privy to the holdings, weightings and trades prior to us executing them.
