Kathy Lien: Forex As An Asset Class
By LawrenceMs. Lien talks about the importance of diversification into other currencies.
In the old days, US dollar was king and that the currency environment was pretty static across the globe. There was no need to diversify one’s investment portfolio into other currencies. Investors with stocks in US, UK, Germany, etc. all enjoyed stable economic environment until late 1990s.
At this point, all these accepted knowledge of investing in books and investment classics are pretty useless if currency risk is not taken into account. You can pick the best stocks in your country and it will still worth nothing if your country happens to be Zimbabwe.
The truth is that most people in Asian countries and small European countries know about the importance of having multiple currencies all along. Holding multiple currencies has always been part of their investment common sense. It is about time for the people in major Western countries to learn more on this important investment concept.
