The exchange traded fund (ETF) PowerShares DB G10 Currency Harvest (DBV) has outperformed the S&P 500 since early June as you can see in the chart below. DBV is up 13.8% year-to-date.
DBV’s performance is important to monitor because it’s an unusual ETF. 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. As Roger Nusbaum of Random Roger’s Big Picture notes, currently DBV is long on the Australian dollar, the Kiwi (also known as the New Zealand dollar) and the GBP and short on the yen, the swissi (short for the Switzerland franc) and the Swedish kroner.
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.