Wall Street Journal
May 16, 2012
Preparing for Greece's exit from the euro has moved from abstract to inevitable for many currency traders.
Funds are increasing cash positions, ramping up trades that take advantage of an expected rise in volatility and shedding counterparty relationships with firms that could have exposure to a Greek exit.
Greece's latest failure to form a new government on Tuesday has more investors convinced Greece will simply opt out of the currency bloc altogether.
Among those going to cash is Anthony Welch, co-manager of the currency fund at Sarasota Capital Strategies, which manages $14 million in currency investments through exchange-traded funds. Welch has pulled back from aggressive currency bets, including getting out of the Australian dollar completely. In the past week, he has also increased his fund's cash position to 24% from as low as 6% in January.
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