The British pound and exchange traded fund (ETF) is getting another breath of life as money from insurers, pension funds and institutional investors pours back into the country. How long will it last?Currency flows back into Great Britain are supporting the pound, and many of the capital is coming from pension funds, insurers and institutional investors. Joe Weisentahl for Clusterstock reports that in the 60 days to May 13 the money flows were 99% higher than any comparable period since 1997, according to Boston-based State Street Global Markets LLC.
The pound gathered strength today after the Bank of England voted to hold the key interest rate at a record low of 0.5%, says RTT News.
The depressed pound is actually a way to play distressed assets with potential for the upside, says Weisenthal. Citigroup recently reported that the pound is one of the ost undervalued major currencies.
Watch the trend lines to see if a rally emerges, however.
- CurrencyShares British Pound Sterling Trust (FXB): up 6.3% year-to-date
Read the disclosure, as Tom Lydon is a board member of Rydex Funds.
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.