Investment Managers: Working with a Forex management company to offer your clients Forex investments

As an investment manager you need to offer your clients the best range of products but also the best ratio of risk to potential gain. To do this you need to give them a wide spread of investments that will have more stability. If you focus on shares alone you may have a spread across different industries so certain events won’t affect all of your clients’ investments. You may also spread investments across shares from different countries as well but this starts to make it difficult to keep track of what is going on in every industry in every market.

Certain events such as banks cutting back lending to businesses will affect all markets though. Currency may well not be affected though even when every shares market and commodity market as well seems likely to collapse. Currency values are mainly relative for a start meaning that with a good portfolio of foreign currency risk is low.

It makes a lot of sense then to include Forex trading in your client’s portfolios but this will often mean a steep learning curve if you are more used to shares and commodity trading. By using a managed Forex account someone else can manage the investments for you, all you need to decide is how high a risk you want a Forex portfolio to be. Even with a high risk Forex portfolio though, which might have less of a spread of currencies and more less traded currencies or currencies from nations reliant on one industry, you can get a lower risk than with an equivalent shares investment with an equivalent potential gain.

In a global downturn portfolios reliant on shares and commodities can collapse in value while certain currencies can rise in value. As an example if the Euro becomes more stable this actually could mean an increase in the value of the British Pound and Swiss Franc as countries drop the Euro as a reserve currency and move to these instead.

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