Don’t Let the Euro Dictate Your Portfolio
By PAUL J. LIM
The way to get diversification is to own foreign currencies. Lim presents the data but makes the wrong recommendation (holding onto the stocks)
MICHELE GAMBERA, head of quantitative analysis at UBS Global Asset Management in Chicago, says that even if foreign stocks no longer zig when domestic shares zag, one reason that these asset classes don’t always post similar returns each year is the currency effect.
“By having even some passive exposure to different currencies, you are adding diversification,” he said.