Investors can obtain increased protection against the losses caused by the weakest dollar, given that the global portfolios are largely invested in American companies, “Swissquote Ipek Ozkardeskaya analyst said in a note.
She said this could affect the average dollar evaluation. Investors did not feel the need to hedge against the weakest dollar because in the times of market fluctuations, the currency usually strengthens the safe driving flows.
“But recently, the dollar was weakened despite the high fluctuations, and the latter increased the costs of hedge, which leads to an unusual negative relationship between the dollar and fluctuation.” She wrote that this creates a “dangerous headache” for investors.
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