Hi all,
I cannot bring my mind about what to do now when i see the strentgth of the USD.
Lets assume the following situation:
February: Eur/Usd 1.2
I bought 100k of SPY ETF in EUR in february.
This where 120k USD of SPY in february.
Lets assume SPY dropped 20% since then:
Today: Eur/usd 1
I now have 100k USD of SPY.
This translates to 100k of EUR.
Although the market lost 20%, people in Europe did not lose money from february until today. So the strong dollar saved our ass.
HOWEVER: this means that if SPY goes back to ATH and the EUR strengthens again to the 1.2 ratio. My upside is 20% less in current enviroment than ones of a us citizen.
Can somebody explain to me what one should do now? Should i (AND You in the US with USD) buy european ETFs with european companies and EUR as base currency? Or is it all the same? I think my brain lacks basic understanding….
I mean i could sell all SPY today and would have outperformed any american citizen by 20%
What am i missing 🙁
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