FV Question

Frozen

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Can someone help me understand the relationship between FV, the strength of the dollar, and its effects on how the I fund gains/losses are determined? Thanks for any help.
 
Re: Frozen

In simple terms, the dollar being strong hurts the I fund and a weak dollar helps the I fund.

If the u.s. dollar exchange is, just for a very simple example, up 1.0%, then you would take that away from the I fund and if it is down 1.0%, then you would add that to the I fund. Large movements in currency will have their effect on the I fund's fair valuation. Keep your eye on what's called the yen carry trade (in other words I can't explain it -- you just have to watch it and understand that the dollar being weaker helps the I fund). There is sort of an inverse relationship between that and the I fund. Someone please correct me if I am wrong.

A good site to check these numbers is: www.fxstreet.com

Now, that is just one part of the fv equation --- changes after 11:30 ET of more than .51% in the USMarkets will also factor in and usually have more bearing on the fair valuation than currency movements. But that is Barclay's criteria and I haven't even begun to understand those guys. :D
 
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