Multi Currency Update #12

by | Mar 23, 2008 | Archives

Multi Currency Portfolio Update #12

Here is the updated performance of the six global investment 
portfolios that Jyske Bank created with our direction. We 
have been tracking them for educational purposes beginning 
November 1, 2007.
These portfolios are all still down. 

2008	         Dec 14	  Jan 21   Feb 19    Mar 20
Infrastructure 	-20.97%	 -68.47%   -69.39%    -79.79%
Emerg Mkt	- 9.80%	 -36.78%   -44.27%    -53.75%
Danish Health	-32.51%  -61.62%   -78.99%    -79.55%
Green	        -14.31%  -54.29%   -45.23%    -58.78%
$ Short Non	- 9.08%	 -15.42%   -18.99%    -19.69%
Blue Chip	- 5.14%	 -37.68%   -24.98%    -47.55%

There are several lessons we can derive from a quick glance.  

First the non leveraged portfolio is performing best. 

This portfolio is invested in three funds and Jyske Bank

CCY  Investment	             Invested    Current Value   	                                    Invested	  Todays Value
EUR   JI European Equities   25,000.00 	   20,608.00
EUR   JIFavourite Equities   25,000.00 	   21,136.23
USD   JIFar East  Equities   25,000.00 	   18,264.61
DKK   Jyske Bank             25,000.00 	   20,309.62 

The bank shares like so many equities in the financial sector
have taken a hard hit.    Plus the Far East is down further
than the major markets funds held in this portfolio.

Yet the second lesson is that the emerging market fund is the
least hurt of the leveraged portfolios.

This to is a lesson about the power of leverage to lose as
well as gain.    This portfolio is leveraged only one time
($100,000 invested and $100,0000 borrowed).  The other
leveraged portfolios are leveraged two times ($100,000
invested and $200,000 borrowed).

CCY	Investment 	  	     Invested      Value                                                   Invested 	   Todays Value
USD	JI Chinese Equities	     50,000.00 	 31,869.27
USD	JI Latin American Equities   50,000.00 	 45,609.84
EUR	JI Eastern European Equities 50,000.00 	 45,168.75
EUR	JI Turkish Equities          50,000.00 	 33,939.33 

Today’s focus is on the infrastructure portfolio shown below.
The portfolio with $300,000 invested is worth $248,94 down
17.16%...about par for the course in the equity markets of
the last four months.

However the leverage turns this downturn into a much bigger
loss. $100,000 was originally invested and $200,000 borrowed.
So the loss on the $200,000 loan goes against the $100,000
original investment.

Plus the borrowed Swiss francs and yen have appreciated against
the invested currencies.  The loan payoff, even before interest
due, is $226,329, a 22.6% loss on the original $100,0000

Add the loss on the $100,000, plus the loss on the $200,000
borrowed and the loss on the forex and only $20, 213 is left,
a downturn of 79.7%

CCY	Name	       Invested Amount     Todays Value
DKK	D/S Torm           50,000.00 	    35,063.85
DKK	FLSmidth & Co.     50,000.00 	    44,655.50
SEK	ABB Ltd	           50,000.00 	    43,123.17
EUR	Siemens AG	   50,000.00 	    46,563.97
JPY	Komatsu Ltd.       50,000.00 	    36,362.87
EUR	Veolia Environt    50,000.00 	    42,725.16
                          300,000.00 	    248,494.51
 	                Borrowed    Payback   Interest Due
JPY	 Loan	2.750  100,000.00  112,407.75  1,210.73
CHF	 Loan	4.375% 100,000.00  113,921.46  1,952.09 					                                      226,329.21
Total Debt			            228,281.30
Value	 	 	 	 	     20,213.20 

There are however solutions...right now mainly in bonds.
Our next update looks at my personal portfolio which
I am pleased to say is up because I stuck to bonds.

Until the next update…good global investing!


You can see Jyske Bank's bond list at

You can contact Jyske Bank through their manager of
client relations Thomas Fischer at FISCHER@JBPB.DK

You can join me with Thomas Fischer of Jyske Bank at
our upcoming International Investment  & Business course
in North Carolina this May 23 to 25 at Merrily Farms. 

See NC Course