A recent review of the Rydex NYSE Euro Currency Shares (FXE) exchange traded fund points out the advantages of using this ETF as an investment tool.  Some of the main points of the article include:

  • Holds only Euros and generates modest net interest
  • Can be used to protect against the Dollar deflation
  • Offers a kind of Dollar inflation protection
  • One can speculate and make short-term macroeconomic bets in any direction

A good currency strategy would be to consider FXE when the Euros per US Dollar is above the 200-day moving average. 

Euros per US Dollar Chart

Eurotodollar_2 

For full disclosure our clients do not own FXE, but Tom Lydon serves on the board of Rydex Investments.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. 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.