Sunday, February 18, 2007
Can you make money on the forex hedging the euro and the frank? -
you could but you stand to lose a LOT more. and the Franc still exists? I thought it went to Euro. Hi Joel, Well historically speaking the Euro and the Swiss Franc have an inverse correlation meaning when one pair goes down the other pair goes up. My wife and I have seen this first hand because we ve been trading those two pairs using the FreedomRocks strategy for the last 7 months. I just emailed you some more information that I think you ll find very interesting and if you have any questions just let me know. Best Regards, Yo amp; Jaime Hi Joel, What you are probably looking for are some facts. Let s say you went back 10,000 hours (1/12/06) and opened an account hedging the EUR/USD at 1.2145 with the USD/CHF at 1.2743. Let s assume that you opened an account with $5000 but only wanted to use a margin of 10%....investing $500 into your trade. You took a long position on both currency pairs and traded with a 400-1 leverage. You didn t do a thing with your positions in fact you didn t even look at them for 13 months. Today (3/5/07) the EUR/USD is at 1.3088 and the USD/CHF is at 1.2206. Your EUR/USD position is up +943 pips and your USD/CHF position is down -537 pips. Your Euro position would be +$9342 and you Swiss would be -$4233 for a net gain of $5109. As a nice kicker you would also have made $2.70 per day in interest for an additional $1115.10. Your $5000 account grew to $11224 in 413 days (10,000 hours). 125% in 13.5 months. So my answer is yes you can make very nice money hedging the euro and swiss franc. If you want any more facts drop me an email at pupp52@yahoo.com No! Most Forex schemes are scams. i suppose you could, but it would be purely a bizarre arbitrage. i mean, how much differently do the euro and the frank move? i could see buying new-issue bonds in one currency and hedging with the other, but, well, i would just think there s better ways (perhaps more agressive, perhaps not) to make more money.
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