forex forum eur usd
The South African rand was the world's second best performing currency in 2009. The rand rallied 28% against the U.S. dollar. Beyond paid by the South African rand by 7% in interest income. In a leveraged forex account that is 700% leveraged in interest income alone.
King of Bling
South Africa is the King of Bling. It is one of the world's leading exporters of gold, diamonds, platinum, palladium, silver ferrachrome, manganese and precious stones.
As bling prices rise, so has the South African rand. estimated as platinum and gold prices in 2009, soared to the RAND and the Australian dollar (AUD) with them. Like South Africa, Australia is a leading gold miner.
The outstanding performance by gold, were the South African rand and the Australian dollar is not accidental. South Africa owns the world's largest gold reserves of an estimated 40% of the world total. Australia is currently the world's leading exporter of gold. As a result of the edge and AUD Price moves in tandem with gold prices. One study found the ten-year price correlation has been in more than 80%
Better than owning gold
If bullish on gold, draw I am the owner of the South African rand and Australian dollar against the possession of gold for the following reasons:
Leveraged Interest income: Leveraged Interest income is a beautiful thing. $ 1,000 with your Forex broker. This down payment on the purchase of a standard $ 100,000 South African rand currency position. The South African Rand pays 7% interest on the $ 100,000 currency position. If the interest rate remains unchanged for a full year, you can earn $ 7,000 as interest income on your original $ 1,000 investment.
Leveraged Appreciation: This can work for good or bad. In 2009, when the South African rand appreciated 28%, which was about a $ 28,000 profit on your leveraged position. Add to your $ 7,000 in leveraged interest income, and you could have earned $ 35,000 to $ 1,000 investment. Conversely, if the price of gold and the South African rand fell 28% in 2009 would have leveraged your position would be $ 28,000 less $ 7,000 have lost your interest, for a net loss of $ 21,000. Since you had deposited only $ 1,000 in your account, your account would have went into debit, except for your no-direct debit guarantee.
No-Debit Guarantee: As leveraged income from interest no payment guarantee a beautiful thing. The charge does not guarantee applies the double-edged sword the lever is in a superior speculative investment structure that resembles a limited risk of long call option position. You have unlimited head from the edge of leveraged appreciation and interest income. But your downside loss is limited to the amount of your deposit in your Forex account.
The choice of funding currency: If you buy shares, Gold or other property you pay with USD. If you buy a currency, you pay for it with the currency of your choice. To purchase the Rand (ZAR), you can sell USD / ZAR or you can sell EUR / ZAR, or JYP / ZAR. You can greatly improve your return by the choice of the weakest currency. In the year 2009 was the U.S. dollar is the largest dog. So far in 2010, the EUR-pigs in the nearly 10% last month alone has fallen. So even if the edge does not have a good year, you can by buying a large she returns with a weaker currency to earn.
Although the South African Rand will pay higher interest rates and still better than the Australian Dollars if you are betting on higher gold prices, you should have both currencies. Diversification reduces your exposure to country-specific risks (earthquakes, national strikes, etc).
David Driver
Chief investment Officer
http://www.visionaryforex.com
Forex Trading Strategies with the EUR/USD
