Tag Archive | "Emerging Equities"

Multi Currency Trust


Multi currency trust is really important now. A huge multi currency stock market and property correction could be just ahead.

This correction can bring unprecedented value opportunity. But how do we know who to trust?

If our multi currency investments are in what we know and with those we trust…our investing is always one step ahead.

For example, below you will see a breakdown of my total multi currency position and why I have made money this last year when so many have lost.

One important point to note is that the largest increase in my multi currency portfolio is in Ecuador real estate. This is because I am involved in Ecuador every day and have a feel for what is going on. Plus I know people in Ecuador that I trust.

Take for example the Vitazul Ecuador beach condos built by Kjetil Haugan.

One reason I made an investment there is because I have worked with Kjetil for more than a decade and I trust him. I first met Kjetil when he had just moved to Ecuador and was beginning to develop business there. Now, just over a decade later he has one of the largest Spanish schools in Ecuador, one of the largest travel agencies in Ecuador, two boats that tour the Galapagos, a hotel and he is building 63 condos. Here is Kjetil at the condo construction.

multi-currency-condo-builder

Over the decade Kjetil has surprised me with what he gets done again and again. So when he contacted me last November and told me about the condos and the clubhouse-hotel he was building, I immediately became interested.

Last November when he contacted me the condo clubhouse looked like this.

multi-currency-condo-hotel

and the clubhouse swimming pool was…

multi-currency-condo-beach-pool

Yet he told me that he would be operational for the new year.

He was.

I drove down from our home in the Andes shortly (January 20 to be exact) after and was the first condo investor because of trust AND WHAT I KNOW ABOUT ECUADOR. This is on the record. See what I wrote in January 2008 about this project at Ecuador Beaches.

Here is the club house now…less than a year later.

multi-currency-condo-clubhouse

and the pool.

multi-currency-condo-pool

When I arrived nine months ago, the land where the condos were to be built looked like this.

multi-currency-condo-site

…just nine months ago. Here it is now.

multi-currency-condo-construction

In nine months…in Ecuador…on the coast…amazing!

Yet I was able to invest at the beginning before inflation started to really bite. Investing in what you know and in those you trust pays.

Prices have risen on these condos, but still offer an incredible value, plus until October 1, Kjetil is offering the original price (a $10,000 savings) to Ecuador Living subscribers.

For details on the units below contact Thor Anderson at thor@sanclementeecuador.com

Before you invest anywhere, however, let me please exclaim loudly…proceed with care.

We may be seeing a systemic cleansing similar to the 20s. Even if we are not, this is a time when investors can do everything, that in the past, was right and still lose. This is one reason why I like investing in real estate (US and Ecuador) now. I know and trust real estate. Real estate is a multi currency inflation hedge. Real estate is a hedge aganst a falling US dollar. Government bail outs create inflation. Real estate is an inflation hedge.

You can see the increase of real estate in the breakdown of my own portfolio this year

Many indicators suggest that this is a time when most investors believe the market will be down, but it actually will rise…perhaps a lot. So looking for value in equities and real estate make sense now.

Invest now? Does this sound crazy? Probably no crazier than in August 2007 when everything looked so fantastic and I warned readers to reduce debt and I unloaded most of my equities, moving into cash, Ecuador real estate and bonds instead.

As you can imagine I am pretty happy about this right now. I am reviewing my exact portfolio with my multi currency course subscribers at this time. Here is a portion of what they are reviewing, the breakdown of my personal portfolio a year ago and where it is right now. The percentages are rounded.

October 2007 Total Cash 9.7%

October 2008 Cash 10%

October 2008 Foreclosure Cash 3%

October 2008 Total Cash 13%

October 2007 Equities 6%

October 2007 Emerging Equities 1.5%

October 2008 Equities 5%

October 2008 Emerging Equities 1%

October 2008 Total Equities 6%

October 2007 Bonds 31.7%

October 2007 Emerging Bonds 8.5%

October 2008 Bonds 24%

October 2008 Emerging Bonds 10%

October 2008 Total Bonds 34%

October 2007 US Farmland 21%

October 2008 US Farmland 31%

October 2007 US Commercial Property 19%

October 2008 US Commercial Property 6%

October 2007 Ecuador Property 3%

October 2008 Ecuador Property 10%

First, let me clarify that this portfolio is not totally accurate. All the property is shown at cost. Much of this was purchased as long as a decade ago and could be sold for much more than shown. Both US and Ecuador property.

Second, even without trying to estimate a real estate value the portfolio rose…just a bit…about 5%. That is less then half the performance in 2007, but for this last year I am pleased. Not losing in 2008 is good! In addition to maintaining the portfolio’s capital, I feel especially well positioned to capitalize on current events. My cash position has grown and and many of the existing bonds mature this next year. This gives me plenty of liquidity to pick up bargains created by the market correction.

Third, I did little buying or selling of equities this year. The reduction of equities in the portfolio is entirely due to drops in price of the equities held.

I mostly looked for bargains in real estate…mainly in Ecuador and picked up several.

The same is true for bonds. The reduction in bonds in the portfolio is due to
maturities and the increase in emerging markets is due to currency strengthening of the bonds held.

Last year I felt a bit like a spider sitting in its web watching the fly come closer.

Now I am ready to bite! I have committed 3% of my portfolio to buying US real estate foreclosures.

Plus I am watching equities. The time to buy may be near. You can learn why as a multi currency course subscriber

Until next message may everything you believe in be worthy of your trust.

Gary

I’ll review my entire portfolio and all this thinking next weekend. October 3-5 in North Carolina at our International Investing and Business Course. Why don’t you join me.

The course was fully booked but we had many late applications and have have moved to a larger meeting room so still have space.

Join me with Thomas Fischer of Denmark’s Jyske Global Asset Management, who was a currency trader for years to review our multi currency portfolio thinking for the year ahead.

To help our subscribers meet and learn, we are giving all delegates at the North Carolina course a FREE year’s subscription to our online multi currency course. This is a $249 value.

This will not be all work-no play. We selected this particular weekend as the most likely to be beautiful with the autumnal leaf change. The colors are glorious.

autumn-gold

Here delegates at a previous course chat during a coffee break.

blue-ridge-leaf-change

Gary

Join us in North Carolina next week end October 3-5 and save $249. Enroll here.

Or join us in November to inspect Ecuador property for sale

Vistazul-Ecuador-beach-condos-model

Our September 17-20 Ecuador Coastal Real Estate Tour; Quito Real Estate Tour was sold out as was our September 28-29 Imbabura Real Estate Tour was sold out.

Our Oct 14-18 Ecuador Import Export Course only has a couple of spaces open.
https://www.garyascott.com/catalog/ecuador-import-and-export-tour

We still have space in November

Join us in Cotacachi at El Meson de las Flores.

cotacachi-daybreak

Nov 7-9 International Investing and Business Made EZ Ecuador
https://www.garyascott.com/catalog/international-business-made-ez-ecuador

See these condos at $46,000 in Cotacachi.

Nov 10-11 Imbabura Real Estate tour
https://www.garyascott.com/catalog/ecuador-real-estat

Dine with delegates at the Vistazul clubhouse.

Ecuador-fishng-view-4

November 12-15, 2008 Ecuador Coastal Real Estate Tour; Quito Real Estate Tour
https://www.garyascott.com/catalog/ecuador-coastal-real-estate-tour

Multi Currency Question – Recession


Here is a good multi currency question about the global recession.

Recessions create opportunity for multi currency investors, but not always in the short term. Good value oriented multi currency investors may even suffer more during downturns. Recessions improve value in multi currency portfolios but the profits from this value comes only when markets recover.

Value investors are not market timing investors. This is good because most market timers usually lose in the long term.

Well diversified multi currency portfolios reduce volatility but do not eradicate it totally as is explained in the answer to this good multi currency question.

Here is the multi currency question:

“HI Gary, First let me send my love to you and Merri from Israel and thank you for your sharing of info. The question I have is: With the credit problems and banks going under and reduced credit globally shouldn’t this bring down global valuations on stocks? Wouldn’t it be a risky time time to be invested in most stock markets? I read that it is the credit that is propping up the share value. I also read that it is possible for 150 banks to go under, that seems like it would be a huge ripple effect. It seems that it is not isolated to just the states, last week I read about the Danish bank in serious problems. I remember you recommending property, commodities and shares to fight inflation. Do you think the shares rewards outweigh the risk in times like these? Thanks for any insight without panic.”

Here is a reply about multi currency investing that you may find worth study.

Thanks for your question.

First, we are not advocates of market timing. Remember rule number seven of the Seven Rules of Global Investing. “Value is reflected long term. Equity markets are efficient in the long run but are not effective short term due to human behavior”.

Having said this, we do realign the weighting of our investing activity based on our beliefs of where the 30 year market cycle stands. To learn more about the thirty year cycle.

Longer term subscribers know that we began warning about equity markets in August 2007 (the 17th to be exact) when we wrote: “Such historical measures are so inexact that we cannot predict just from them what will happen in the short term. The numbers are close enough that we could be entering the fourth sub cycle down (similar to 1976 to 1978). If so expect a sustained drop in markets for two to three years.” See the entire warning here.

Our September 21, 2007, message said: “Equity markets dropped again violently last month. Now these markets have recovered again. Yet this may be a last gasp party. This drop of interest rates at a time when inflation is beginning to soar could lead to a rapidly falling US dollar. We can see from the chart here that the dollar has done almost nothing but drop for 40 years (that chart is below). Yet much more dollar dropping could be in store.”

The October 14, 2007 message stated: “Periods of high performance are followed by times of low returns. We never know for sure when an upwards cycle will stall. Fundamentals look good for a bright 2008 in emerging and equity markets, but this can change quickly so to give our readers a better perspective, this year we are reducing leverage and adding a sixth portfolio with no leverage to study”.

Oct. 15, 2007 we wrote: “Okay, it’s time to turn the burner down.”

We offered a “leverage dwindling” warning on Oct. 26 where I explained to readers that I had eliminated even my modest leverage and wrote: “There is a final reason I liquidated my leverage now…to lead by example. Too many readers are thinking that the dollar short or dollar neutral Portfolios are only up 38% or 48% for the year. When one thinks that way they could be headed for trouble, so I hope investors will follow my lead and take greater care with their leverage.”

The November 8, 2007 Black Friday interim message warned about all the points above and more. At that time I let readers know that I had reduced the equity portion of my personal portfolio to 6%.

My published portfolio at that time was.

Real Estate 43.0%
Euro 10.5%
Emerging markets 10.0%
Danish kroner 9.9%
US$ 8.2%
British pound 6.0%
Swedish kroner 4.0%
NZ$ 3.7%
Aust. $ 1.0%
Canadian $ 1.0%

The liquid portion of my portfolio was

Cash 9.7%
Equities 6.0%
Bonds 31.7%
Emerging Equities 1.5%
Emerging Bonds 8.5%

There is a chance that equities will fall further. Yesterday’s Multi Currency Portfolio update focused on why value investments tend to drop more in downturns than the norm.

However, this is the best way to make long term multi currency profits…buy good value shares on the downside. One can never predict when the market will turn and when it does turn most market timers get in too late.

I lean towards real estate rather than shares because this is fun for me.

The way each person should position the multi currency portfolio should be based on what they love, enjoy and know best…real estate, commodities or shares. All three asset classes offer more potential than any one person can capture in a lifetime. Why not go with what brings the greatest joy in your life?

Regards,

Gary

P.S. Don’t miss our offer that expires the end of July 2008 for Fresh Ecuador Roses 50 FREE

Learn how to be a better multi currency investor.

Join us and stay at our farm for Susan Rotman’s business intuition course.

Dine with Merri’s excellent home cooking served outdoors in the cool mountain air.

outdoor-cooking

See dates for our Autumn courses and tours:

Visit the San Clemente condos and real estate from Manta north and south. Here are the condos going up.

ecuador-coastal-condos

Ecuador Coastal-Quito Real Estate Tour

Ecuador Super Thinking + Spanish Course

Enjoy learning at our Cotacachi hotel

open-air-learning

Ecuador Imbabura Real Estate Tour

International Investing and Business Made EZ North Carolina

Ecuador Ecuador Import Export Course

International Investing and Business Made EZ Ecuador

See discounts for attending more than one course.