dollar is weak, time to buy dollar shares?

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pernickety

Registered User
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Hi,
Having a very stupid day and can't get my head around this.

I've been purchasing euro shares/funds (and some yen) for a while now and intend to buy some in dollars at some stage. Listening to reports of euro high against the dollar at the moment and was about to lunge head first in... the the thought struck me that to purchase a fund in dollars, the fund managers are taking my euros and converting them which costs a lot of euros. Does that mean I should be waiting for the dollar to perform well? (and then probably the fund will be performing too well)

sorry this is such a muddled post, i'm very confused as you can see.
 
There is always currency risk in addition to the usual risks when you buy assets outside the eurozone. Dealing with the currency risk alone - you are better of buying dollars when the dollar is weak because you get more dollars per euro than you otherwise would e.g. you will get $1.35 today per euro whereas last October you would have gotten $1.25 for the same euro. However there are no guarantees that the dollar won't get even weaker after you have bought the dollar denominated asset - the opposite is what you want ie ideally the dollar would appreciate after you have bought them so that when you eventually cash in the dollar asset and convert back to euro you will gain, and hopefully the asset will also have gained in value. Unfortunately there is no way of accurately predicting what the eur/usd rate is going to be in 5, 7 or 10 years time which imo would be relevant timeframes for holding shares.
 
demoivre,
thank you, i think I was confusing the rate as being the other way around 1.35 euro = 1 dollar, but you've saved the day thanks. Yes i understand the risks with currencies, but I'm willing to lose the money so willing to take a gamble! Thanks again!
 
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