Quote:
Originally Posted by John Kicklighter
These pairs all have potential for a carry trade because of their rates. However, many of them are volatile and/or they are managed by policy groups (and could therefore are frequently manipulated, which may lead to considerable capital losses).
Personally, I would stay away specifically from the Singapore dollar and the Hong Kong dollar because both currencies frequently see sharp fluctuations from unexpected intervention from their monetary policy authority groups (and I have heard of at least one good trader's sizable account being wiped out on such an event).
The other currencies can be integrated into a carry strategy but a few of them (ZAR, HUF) can produce serious volatility; so it is best to make a basket of these pairs with more cautious ones. I would also underweight those pairs specifically because they have high yields and high volatility and overweight those that are more stable.
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Thanks.
Please see my jpg file.
What do you mean about this chart?
How can i use this data at carry trade?
