G-10 Currencies’ ETF Awaiting China Release of Reserves

December 12th at 10:00am by Tom Lydon

2742756672 Investing in China’s yuan doesn’t have an easy or direct path, but an exchange traded fund (ETF) from PowerShares does offer an indirect opportunity. The Stock Advisors says many investors are wondering what China will do with their $1.4 trillion worth of currency reserves, which is the single-largest pile in the history of the world. When it comes to influencing the worlds currencies, this gives China unbelievable power. 

When China begins to release its reserves, the G-10 countries and their currencies will be affected. That’s when PowerShares DB G-10 Currency Harvest Fund (DBV) can come into play. It tracks 10 currencies, going long on the top three currencies with the highest interest rates and going short on the top three currencies with the lowest interest rates.  Countries include the U.S., Europe, Japan, Canada, Switzerland, Britain, Australia, New Zealand, Norway and Sweden.

DBV is up 8.4% year-to-date.

G10etf

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.