Profit From the Rate Cuts Around the World – Look to the Currency Market

Profit From the Rate Cuts Around the World – Look to the Currency Market

Are you sick of the stock market?  Are you staying up late worrying about your retirement account?  Is your stomach permanently tied in knots because of volatility?  Are you dizzy from the markets being up 300, down 800, up 100, down 700.  Are you looking at your statements just wondering why all your money is disappearing?

Is it time to try something new?

Let me tell you, many investors believe buy and hold is dead.

What do I mean?  Just look at the stock market over the last 10 years. Back in early 1999 the Dow Jones Industrial Average crossed 10,000. Today, almost 10 years later the market’s in exactly the same spot.  No joke.

So if the equity markets aren’t the place to be what’s left?

Have you thought about trading currencies? These days, currencies are easy to trade.  You can do it right from your own brokerage account.  No need to open new accounts or learn a new trading language.

  Another reason to look at currencies: we are on the edge of a recession, not only in the United States but around the world as well.  And I’m not the only one who sees this happening.

Apparently the major central banks around the world feel the same way – they all cut rates in emergency sessions last night.  Our own Federal Reserve cut rates 50 basis points.  Major investors the world over see the risks to the global economy.  In order to preserve investment dollars they’re moving to safe investments.

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The safest investment in the world is the US Dollar.

I know what you’re thinking.  “My money is already in US Dollars.”  That’s great!  This gives you an even better opportunity to profit.  And here’s how to do it.

Currencies trade in pairs.  Let me give you an example.

Global investors had moved a good deal of money into Australia over the last few years.  The economy was humming along and their money was earning high levels of interest (in excess of 7%).  This means they owned a great deal of Australian Dollars (The local currency).

A few months ago the Australian economy started to weaken.  Consumer spending slowed, and as commodity prices fell, the economy’s growth slowed.  At the same time the US Dollar was getting stronger.  The risk in Australia seemed big, so money flowed from the Aussie Dollar to the US Dollar. As a result the value of the Aussie Dollar fell. 

Just yesterday, the Reserve Bank of Australia cut interest rates by 1%. This was a huge move.  Consider most rate cuts are 0.25% or 0.50% at the most.  The reserve bank went a full percentage point.  This weakened the Aussie Dollar even more.

Profiting from the fall.

Over a month ago I recommended to short the Australian Dollar.  We went short by purchasing carefully selected put options.  These options spiked in value over the last few weeks and now show a gain of more than 492%.

But that wasn’t the most exciting trade.

In July, a trade in the British Pound produced a return of 1,027%.  Imagine that . . . ten times your money in less than 2 months.

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In the last two months, we’ve made six rifle shot trades.  A Euro trade returned over 300%.  The Australian dollar we talked about above.  Our Swiss Franc trade is up 109%.  Unfortunately I’m not perfect.  Two other trades maxed out gains at 10% and 20%.

The most recent trade we made is doing really well.  I wish I could tell you what it is, but that wouldn’t be fair to our paying subscribers.  Let’s just say the trade’s moving in the right direction.  As I write this, we’re showing gains of 75% in less than 5 days.

You might consider adding currencies to your portfolio.  Long term trends are setting up in the US Dollar.  The macro-economic environment and recent stock market volatility might make now a good time to research currencies further.  Remember, they’re easy to trade and the profits can be substantial.