Head of Trading Department of Aravana Capital Management Valdis Waldorfs gave his assessment regarding issues related to exchange rates.

How will the exchange rate behave at the beginning of 2021?

Since at any moment in time a point may arise at which the deviation from the given parameters becomes maximum, therefore an incorrect assumption will be made that the forecast itself is not correct.

At the same time, many events can occur in a year that can significantly affect the course. For example, a complete ban on investing in Russia by Western countries or sanctions 3.0, 4.0 5.0, etc.

What factors will the exchange rate depend on?

It is quite obvious that the exchange rate will depend on:

1) Central Bank policies

2) Supply and demand

3) Politicians of the country, here you can also add an item with sanctions

4) Prices for black gold

What currencies should you transfer your savings into?

Perhaps now the very moment is coming when the life cycle of this currency is coming to an end. More precisely, the dollar will cease to be the dominant currency. The dollar’s weakness is evident, with many large investment houses giving a -10 / 20% dollar valuation earlier this year. Fuel is added to the fire by the fact that so far the US elections have not had an official point. It is likely that when the decision is announced, significant unrest will arise throughout the country. Is it worth buying this country’s currency in this case? However, the answer will be trivial – to preserve capital (its cash part), it is worth sticking to a simple diversification: 33% euros, 33% dollars and 33% rubles, or add more currencies such as the Swiss franc, pound sterling, Japanese yen and divide it equally.

Sources: Bankiros.ru, Aravana CM

Disclaimer: The author’s comments are not an individual investment recommendation in accordance with Federal Law No. 39-FZ of April 22, 1996 “On the Securities Market”. Individual investment advice / investment advice can be provided by the author on the basis of an appropriate agreement (investment advice agreement).

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