CURRENCY BENCHMARKS

DYNEX DEBT RISK MANAGEMENT

 

Borrowing can become an advantageous business if loan balances can be reduced through interest rate reduction and/or dynamic switching to weaker currencies. Interest rates for different currencies vary greatly. Switching loan balances into low interest rate currencies can reduce the interest burden. Switching loan balances into currencies that fall against the original loan currency can also reduce the loan burden.  DynexCorp uses a combination of both to achieve benefits for the borrower.

 

Debt risk management is suitable for loans in medium to high interest rate currencies if they can be paid back in low-interest rate currencies. During an era of generally low interest rates only loans taken out in liquid higher interest rate currencies (such as currently AUD, NZD, ZAR etc) benefit from debt risk management. For this reason Dynex did not advise on debt risk management since late 2012.

 

 

Back to Home Page

 

July 2007     Dynex Overlay: Hedged Debt
November 2007     3Q2007 Stellar Performance
January 2008     Drop in USDJPY - Enough to steady the ship?
April 2008     EURUSD - Emperor Without Clothes
May 2008     EURUSD - The Big Picture
30 May 2008     Pundits Are Wrong - Markets Fluctuate (30 May 2008)
6 June 2008     Market Sentiment, Bullish Consensus and Contrary Opinion as a Positioning Guide:
August 2008     The USD Long / Short Positioning Index vs. US dollar price index
3 September 2008     Interpreting the CONSENSUS Market Sentiment Index
11 September 2008     Near an Extreme in the Euro?
9 October 2008     Escalating Risk Aversion - Unexpected Prop for the Dollar
11 December 2008     The Fog Is Clearing
23 April 2009     Interest Rate Convergence and Flat Performance
6 July 2009     Lack of Dynamics Causes Switching
5 October 2009     Forecasting is difficult, especially about the future
4 January 2010     Sometimes the only way to win is not to play
5 April 2010     Ugly Duckling EUR Looking for a Playmate
3 July 2010     Positioning Indicators Confirm Sentiment Extremes
4 October 2010     The Pendulum Swings to the Opposite Extreme
4 January 2011     Sidelined Until Year-End, but a Fresh Start in 2011
4 April 2011     Profits from weakness in our funding currencies
5 July 2011     Cycle reverses: Time for the sidelines. Back in EUR.
2 January 2012     Low Interest Rates and a Falling Euro - NO GO.
2 April 2012     Euro Intermezzo - A Spectacular EURJPY
2 July 2012     Repeat of 2H2011 - On the Sidelines