NEWS/BLOG

Steal Like a Banker and Live Abroad!

I have to credit MarketWatch columnist Brett Arends for this idea. Arends, who also writes about personal finance for The Wall Street Journal, commented first of all on how Wall Stree Bankers have gotten away with, well, stealing.

Wall Streeters gamble, and gamble big, with other people’s money. He writes, “It’s not stealing if you get away with it. And because you — or your cronies — write the laws, you get away with everything.” He points out that the top 10 at Bear Stearns and Lehman Brothers pocketed almost $1 billion before their banks went belly up.

The Center for Responsive Politics says that financial firms have already given $122 million in campaign contributions for 2011-12. If you don’t think Congress has been bought by Wall Street, see what Sixty Minutes had to say on November 16. Did you know members of Congress are exempt from insider trader laws?

But, Arends says, the Occupy folks could beat Wall Street at its own game, and it’s fortunate they haven’t considered this because they could create real chaos. Most of them already have the ammo in their own pockets: it’s their credit cards!

Here’s where living abroad comes in. Arends says they could take their plastic, get as much cash as they can and go to the Bahamas. I’m not sure I agree with the Bahamas as a destination, but you get the idea. If the typical occupier is 26 and unemployed, as he suggests, it might not be a bad idea. If thousands did it, they would make a far bigger statement than with camping outdoors in freezing weather, and they’d have more fun.

What of the consequences of defaulting on credit card debt? It might not be a good idea if you’ll need a home loan anytime soon. However, U.S. bankruptcy laws are “crazy,” as Arends says, “You can shelter all sorts of money in things like 401(k) plans and still walk away… .They are in a word, as immoral as Wall Street. They let borrowers treat Wall Street the way Wall Street treats everyone else.”

Is it going to happen? I doubt it and I think Arends does, too. He wrote this as a tongue-in-cheek political statement not as financial advice. It’s not the financial advice I’d give to young prospective expats either, and I wouldn’t want to see more havoc in the country’s financial system. What’s more, I think most of the Occupiers are honest people who wouldn’t max out their credit cards with no intention of repaying. But we haven’t seen the end of the Occupy movement, and who says they couldn’t be plotting their strategy from a sunny beach somewhere? What’s needed is some well thought out strategy to bring about change that really benefits the 99%.

To see Arends’ complete article, go to How to Steal Like Wall Street.

Greek Bonds Get 50% Write-down

European leaders and bankers pulled an all-nighter to reach a solution to the Greek debt crisis. In the end German Chancellor Angela Merkel forged an agreement by “calling the bankers’ bluff,” as The New York Times put it. She told the bankers they could accept a 50% write-down on the Greek bonds or face the consequences of default. Those consequences would be a credit event akin the one triggered by the fall of Lehman Brothers in 2008, and this time the European banks would bear the blame. The bankers agreed to the write-down, and Chancellor Merkel has been widely praised for her strength and leadership.

The agreement sent global markets soaring the following day. However, more details still need to be worked out in Europe. In the markets, although there is somewhat more optimism, uncertainty still rules. 

The Tempestuous Market

With the European debt crisis rocking global markets, staying in cash is probably the best strategy except for trigger-happy traders who can switch from long to short and back again without batting an eye. For those who’d like some insight into what has happened and is still happening in Europe and the U.S., Michael Lewis has a new book, Boomerang: Travels in the New Third World.

For those who haven’t read Michael Lewis, it’s worth noting that much of this book was published in Vanity Fair, and that Lewis is a born story teller who spins one good yarn after another rather than engaging in difficult economic analysis. Perhaps, too, some of his explanations of mistakes made by Ireland, Iceland, Greece and Germany (with an additional chapter on California) are oversimplified. As he travels through Europe, he tries to describe the national character of each country and weaves this into his explanation of the economic ills.

An earlier blog post questioned whether the euro would survive. Interestingly, Lewis points out that the euro was designed to knit European countries together and to prevent Germany from becoming too powerful. The result, however, has been considerable wrangling among European countries as well as a stronger Germany than anyone could have anticipated. German financial firms did make mistakes: they bought what U.S. financial firms were offering.

Ireland’s property market soared to unheard of heights only to crash brutally. Lewis mistakenly writes that Ireland has never lured international buyers. Now though, Ireland has plenty of homes at rock-bottom prices.

Lewis’s latest book won’t help in finding a home in Ireland or elsewhere, but it can add to our understanding of the places he visited and their economies. Anyone who thinks books about economic topics are boring hasn’t read Michael Lewis.

Proxy Moxy!

If you’ve been tossing out the proxy materials generated by your investments, consider getting them electronically. Then consider actually voting. Take back the “public” in public companies. You can support causes you believe in such as the environment, fair executive compensation, fair labor practices, diversity in the workplace and more. A recent update states that although women comprise 46% of the workforce, women comprise only 11% of Fortune 1000 corporate board members! To sign up for updates and start voting online, go to www.moxyvote.com. 

Exec Pay Doesn’t Reward Shareholders

Not long ago, The NY Times ran a piece by Gretchen Morgenson about executive pay, “Enriching a Few at the Expense of Many.” Do companies that pay outlandish salaries to their executives perform better for their shareholders? In the U.S., we’ve been led to think that they do, but some experts beg to differ. One such expert is Texas money manager Albert Meyer, who cites some companies that pay their executive proportionally less, yet have fared very well.

For example, Statoil, (STO) a Norwegian energy company paid its chief executive 11.5 million Norwegian krone in 2010 (about $1.8 million at last year’s exchange rate). He received no stock options, but was required to buy shares in the company and to hold them for the next three years. Compare that to ExxonMobil, (XOM) where the CEO received $21.7 million in salary, bonus and stock awards in 2009, (the most recent pay figures available). His pay package is twice what Statoil paid its nine top executives in 2010.

Statoil’s share price has bested Exxon’s since 2001, when the Norwegian company went public. Through March, STO stock rose 22.3% a year, on average, while Exxon increased along at 11.4%. (Note that Statoil is partially owned by the Norwegian government and Exxon receives subsidies from the U.S. government).

Take the Brazilian energy utility CPFL Energia (CPL). The company’s financial statements compare the highest level of executive pay with that of the lowest-paid workers. In 2010, that ratio was 79 to 1. (The ratio for U.S. companies ranges from 100 to 300, depending on the size of the company.) The Brazilian company also discloses how many complaints and criticisms were made during the year and now many were resolved.

Another company Mr. Meyer mentioned favorably was Telefónica, (TEF) the Spanish telecommunications company, which dispenses stock options to employees then buys calls reflecting the number of shares given as compensation to avoid diluting the existing shares. One U.S. company also noted was Phoenix headquartered Southern Copper (SCCO) with mining operations in Peru, Mexico and Chile.

Disclosure: Do your own due diligence. This should not be considered as advice to buy any of the above mentioned securities. I have owned all of the above at various times with the exception of TEF, but have no plans to initiate positions in any of them in the near future.

Quake Sends Shockwaves Through Markets

The earthquake in Japan was the worst disaster that many people alive today can remember. The human costs are untold, but the monetary cost is estimated at about $30 billion, which is actually less than amount required for the U.S. bailout of financial firms. The quake threatens global markets as insurance companies in Japan and elsewhere may need to liquidate their holdings to pay out claims. These holdings include not only Japanese but global equities and bonds.

Japan is the second-largest foreign holder of U.S Treasuries after China, and Japanese insurance companies have been aggressive buyers of long bonds. Whether these assets will actually be liquidated no one knows as yet. After the Kobe quake of 1995, sale of U.S. Treasuries actually increased.

The few days since the disaster have actually seen the strengthening of the yen, which hit a record high on Wednesday, March 16. Japan is the world’s third largest consumer of oil, after the U.S. and China. Oil prices soared with the turmoil in the Middle East only to drop after the quake with the presumption that Japan’s demand for oil would decrease in the short term. Both oil and commodity prices continue to be volatile. Emerging markets, especially Brazil, where Japanese institutions have invested heavily, are seeing downside pressure.

Emerging Markets Update

And the winner is - Russia. The other three BRIC countries (Brazil, India and China) are doing reasonably well though not soaring as they once were.

EPI - Wisdom Tree India Earnings Fund started tumbling in November and has bounced back only slightly since then.

EWZ - iShares Brazil Index hit a low in mid-February and is beginning to recover, though is showing considerable volatility. Don’t forget, Brazil is economically stable, and has vast amounts of natural resources, some of which it sells to China.

As for India, EPI - Wisdom Tree India Earnings Fund began to tumble in November and has only slightly recovered in the meantime.

China has been disappointing. FXI - iShares FTSE/Xinhua China 25 Index Fund made several trips below its support level though has moved up somewhat since late February.  Meanwhile. PGJ - PowerShares Golden Dragon Halter USX China Portfolio is still below the highs it hit in November. For more China ETFs, see our blogpost www.liveabroad.com/index.php/news/2007/01/

Surprisingly, RSX - Russia Market Vectors Russia ETF shows steady upward momentum. Some authorities believe that by allowing BP (yes, that BP) to make a huge investment in the Russian state-owned oil company Rosneft, the government is demonstrating a major change in its attitude toward foreign investment.

The above is for information purposed only. Do your own due diligence.

Colombia Thrives Economically

The fifth largest economy in Latin America, Colombia has an average annual GDP of $244 billion and is expected to show growth of 4.1% for 2010 with a debt burden of just 24% of its GDP. About twice as large as Texas, it is the third largest Latin American producer of crude, behind Brazil and Venezuela. As yet. only 19,000 of the country’s 440,000 square miles have been explored for drilling although much of the land is environmentally protected. Other resources include gold, silver and copper.

Recently the World Bank listed Colombia as the most business friendly county in Latin America. While contracts have been broken in neighboring countries, Colombia’s legal system offers ironclad protection for such contracts. Many foreign firms already have a presence here, and Hewlett-Packard plans to headquarter its Latin American service hub, with some 4,000 employees, in Medellin.

During the recent economic downturn when the S&P fell 55%, the Colombian index only slipped 30% and quickly recovered. The boom in commodities has drawn a 33% increase in foreign investments in the last year.

Colombia and Peru are planning to merge their stock exchanges, creating one with a market capitalization of $378 billion, according to Financial Times. The move is expected to speed up the activation a separate Chile-Colombia-Peru exchange that will launch direct trading after its test phase ends in March.

The ETF GXG presents a way for foreigners to invest in Colombia. The fund tracks the FTSE Colombia 20 Index, a capitalization-weighted index of the 20 most liquid stocks in the Colombian market. The top three holdings are Ecopetrol S.A. ADR (EC) 16.34%, Pacific Rubiales Energy Corp. (PRE) 16.22% and BanColombia SA ADR (CIB) 15.75%. ADRs are available to U.S. investors.

Disclosure: We currently hold no positions in any of the investments listed above. Do your own due diligence.

More Ways to Invest in Asia

China and India aren’t the only emerging markets in Asia. Some others are also doing very well.

Singapore
The iShares MSCI Singapore Index Fund (EWS) seeks to provide results generally equivalent to publicly traded securities in the Singaporean equity market, as measured by the MSCI Singapore Index. Stocks here are trading at an average of 16 times earnings, and Singapore is regarded as one of the world’s best-run economies. Its stock market is up 16% this year. Most Singapore companies are not traded on the NYSE, so the index fund is the best alternative for U.S. investors.

Malaysia
The iShares MSCI Malaysia Index Fund (EWM) seeks to replicate investment results generally equivalent to publicly traded securities in the Malaysian market, as measured by the MSCI Malaysia Index. At 16 times earnings, the Malaysian stock market is up 30% this year.  Another well-run country, Malaysia has exposure to natural resources. Economic growth is projected to be 7% for the year.

Indonesia
The Indonesia Index ETF (IDX) seeks to replicate the price and yield performance of the Market Vectors Indonesia Index. This index provides exposure to publicly traded companies listed in Indonesia, or that generate at least 50% of their revenues in Indonesia. The fund has 29 holdings and focuses on large-cap companies. IDX is up nearly 46% over the past year.

The iShares MSCI Indonesia Index Fund (EIDO) seeks to replicate the MSCI Indonesia Index. The fund has 42 holdings and focuses on financials, energy and telecoms.

Indonesian stocks are trading at 20 times earnings on average. Capital inflows to the country’s ETFs have doubled in the first nine months of 2010. Indonesia is the world’s fourth most populous country in the world and is a member of the G20.

Taiwan
The iShares MSCI Taiwan Index (EWT) seeks to replicate investment results corresponding to that of publicaly traded securities in the MSCI Tiawan Index. Taiwan stocks are trading at just 13 times earnings. There are actually several ways to make direct investments in this strong Asian economy. One example is the Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE: TSM), that country’s largest chipmaker. Another is United Microelectronics Corp. (NYSE: UMC).

Hong Kong
The iShares MSCI Hong Kong Index Fund (EWH) seeks to replicate investment results that correspond to the performance of publicly traded securities in the Hong Kong market, as measured by the MSCI Hong Kong Index. Many Hong Kong companies offer a major market exposure to China. The Hong Kong economy shows no signs of slowing down.

As of this writing, we do not hold any of the above mentioned funds or stocks. Do your own due diligence.

Ways to Invest in India’s Booming Economy

Second only to China in population, India is the world’s largest democracy and has strong ties to the U.S. India’s economy is booming, with an average economic growth rate of 7% since 1997 and expected growth of 8.5% this year. Unlike in some emerging markets, growth here is driven by domestic consumption more than by exports. 

A number of Indian stocks are available to foreign investors. A few are: Dr. Reddy’s Laboratories (RDY), HDFC Bank (HDB), ICICI Bank (IBN), Tata Motors (TTM) and Infosys Technologies (INFY).

Other possibilities can be found by investigating India-focused exchange traded funds (ETFs) and exchange traded notes (ETNs). Some investors prefer ETFs or ETNs to individual stocks.

* Wisdom Tree India Earnings Fund (EPI): This is a weighted index measuring the performance of profitable Indian companies that can be purchased by foreign investors. (Expense Ratio: 0.88%.
* PowerShares India Portfolio (PIN): The Index replicates the Indian equity markets as a whole, with a group of 50 stocks selected from among the largest companies listed on two major Indian exchanges. The 50 stocks represent these sectors: Information Technology, Health Services, Financial Services, Heavy Industry, Consumer Products and Other. (Expense Ratio: 0.78%)
* iPath MSCI India Index ETN (INP): The Index represents about 85% of the free-float-adjusted market capitalization of equity securities by industry groups in India. (Expense Ratio: 0.75%)
* iShares S&P India Nifty 50 Index (INDY): The index measures the performance of 50 large cap Indian stocks. (Expense Ratio: 0.89%)
* EG Shares India Infrastructure (INXX): The index is a free-float market capitalization weighted stock market index comprised of 30 leading companies determined by Indxx, LLC to represent India’s Infrastructure industries, as defined by the Industry Classification Benchmark (ICB). (Expense Ratio: 0.85%)
* EG Shares India Small Cap (SCIN): The index is a free-float market capitalization weighted index comprised of a representative sample of 75 Indian companies determined by Indxx LLC to represent small market cap companies in India. (Expense Ratio: 0.85%)

In addition, there are these leveraged funds are available:

* Direxion Daily India Bull 2x Shares (INDL): The Index replicates the Indian equity markets as a whole with 50 Indian stocks selected from a universe of the largest companies listed on two major Indian exchanges. The India Index has 50 constituents, representing the following sectors: Information Technology, Health Services, Financial Services, Heavy Industry, Consumer Products and Other. (Expense Ratio: 0.95%)
* Direxion Daily India Bear 2x Shares (INDZ): The Index replicates the Indian equity markets as a whole with 50 Indian stocks selected from a universe of the largest companies listed on two major Indian exchanges. The India Index has 50 constituents, representing the following sectors: Information Technology, Health Services, Financial Services, Heavy Industry, Consumer Products and Other. (Expense Ratio: 0.95%)

The above is presented for information purposes only. Do your own due diligence. Before investing in any leveraged funds, be sure you understand how they work.

Disclosure: We have frequently held positions in TTM.

Brazil Keeps Booming

While European economies continue to churn and China takes a timeout, Brazil is on fire, boasting the largest growth of any major economy for the first quarter of 2010, a whopping 9%. And while Brazil still has large numbers of its citizens living in poverty, the middle class is growing by leaps and bounds, now representing 49% of the population.

The Brazilian government is involved in the economy either as partial owner of some companies or as a strict regulator. This public/private mix seems to work well.

Brazil is currently undergoing a credit revolution, but since banks here have tight government controls, the boom in credit is unlikely to give way to a bubble/crisis. Brazil’s credit growth and the burgeoning of the middle class mean that certain types of stocks are likely to do well. Some worth watching are:

Ambev (ABV) Brazil’s only bottler of Pepsi (PEP) and of beer brands that combined have garnered 70% of the Brazilian market. This stock has Investor’s Business Daily’s highest rating in its category and is currently extended and has a 3.6% yield.

Banco Bradesco (BBD) This bank has underperformed recently but has investments in insurance and in IT.

CPL Energia (CPL) This utilities stock has just pulled back from a new high, is a “group leader” according to Investor’s Business Daily and has a 7% yield.

Gafisa (GFA) The homebuilding company is currently 30% below its 52-day high, but has begun picking up steam and is just above its 50-day moving average. With government support and the demand for more homes, it has potential.

Itau Unibanco Holding (ITUB): A premier Brazilian bank, it is currently 18% below its 52-week high.

Note: This is not a recommendation to buy any of the above investments. Do your own due diligence. 

Rogers Says Euro Won’t Last

Jim Rogers, the financial wizard who culls information by traveling the world on a motorcycle, says that Greece should simply go bankrupt and that Europe will eventually give up the Euro, though not for 15 or 20 years, and the British pound will tank in the next few years. Meanwhile, he’s playing the bounce in the euro.

Rogers sees two minor bubbles at the present, one in Chinese real estate and the other in U.S. treasuries, but he’s not making a prediction on when either will burst. He anticipates the price of gold to reach $2,000 in the next decade, as currencies lose their value. Commodities, including oil, cotton and sugar, he says, will continue going up, not reaching bubble proportions until 2019.

German Mettle?

An update from the currency exchange firm World First.

”People think we are in a mess. We are.” George Papaconstantinou, Greek Finance Minster.

I had the opportunity to sit next to an eminent economist at a reunion dinner on Saturday. The former chief Labor economic adviser now specializes in financial regulation and he certainly had some interesting comments on the current sovereign debt crisis in Greece, what it could mean going forward and why it highlights the problem of trying to use a unified monetary policy to control such disparate economies.

Interestingly, the whole crisis could be averted should Germany come out and publically guarantee the debt.  However, this is a risky strategy even though the Germans hold the largest percentage of Greek debt. The number of countries behind Greece with the potential for similar problems has been well documented and the precedent set could be rather dangerous. The cost of insuring against sovereign default soared in January and the concern that the loss in confidence in sovereign debt, especially US treasures, considered the world’s risk free asset, could have calamitous consequences for the still fragile recovery. Exaggerated fears of sovereign risk could prompt governments into premature fiscal austerity, which could push the world economy back into recession.

In spite of this, the Germans are less than willing to come out and make this statement because, as the premier global manufacturer, they are seeing the euro weaken and with it increasing the competitiveness of their goods in the market. They will have been especially keen to see the large EURUSD move over the past few weeks with many in Germany rubbing their hands with glee.

If you compare the UK to Germany, the argument for a weaker GBP becomes stronger with time and is testament to the ability of the UK to set its own monetary policy. As we have mentioned before, this allows the Central Bank to control the supply of money, availability of money and the interest rate. It has been essential in guiding the country through recession and has enabled a very close degree of control to be exerted over the economy, the lack of which some European countries have deeply missed.

The news that the UK Government still had to borrow in January, when historically incoming tax receipts sure up finances, was a stark reminder of the fragility of the recovery ahead. If the predicted exaggeration of sovereign debt risk is born out it would have catastrophic consequences on the recovery as the Government would be forced into a premature period of austerity. The need to not turn off the taps too soon versus need to sure up the debt position in the country to something resembling sustainable are the two conflicting worries that keep ministers up at night.

The complex relationships between sovereign debt and the foreign exchange market can be seen more now than ever before and with the Germans eager for a weaker euro it would be foolish for Britain to think that a stronger pound would do the economy any favors at the present time. So while both the UK and Europe would like to see a stronger pound, it might be to the detriment of the recovery. You can’t always get what you want, but if you try sometimes, well you might find you’ll get what you need.

Trade of the Week

This week’s trade of the week is a Tarn Convertible. This structure combines the ability to buy above the current market price with the ability to gain should the market move in the client’s favor.

The way a TARN works is the client has a strike rate above the current market, in this example at 1.61 on GBP/USD, and a “bucket” of figures to use, let’s say 17. If the market is trading at 1.52 then the client will get 1.61 and have to spend 9 figures from their bucket. The next month they have 8 figures to spend and this continues until the bucket reaches zero or the term of the structure comes to an end.

If the market is trading above 1.61 then the client is able to benefit up to a level of 1.66 without using any of their remaining figures in the bucket. If on the day of expiry the market is trading above 1.66, the client is obliged to buy his dollars at the strike rate of 1.61.

This trade works for both buyers and sellers of sterling and is available against other currencies (euro, yen, Aussie, Kiwi).

For more information, see World First.

See Disclaimer below.

GREECE HAD HELP FROM GOLDMAN SACHS

The debt crisis has more in common with the credit crisis in the U.S. than one might think. According to a New York Times story, February 13, Greece has sought and found help in the form of innovative financial products from none other than Goldman Sachs.

Greece needed money but its politicians, like politicians everywhere, did not want to be seen as incurring debt. Almost no rules exist as to how countries may find the money to meet their needs.

The bankers invented new financial instruments and gave them names from Greek antiquity. Aeolos, a legal entity created in 2001, helped Greece reduce the debt on its balance sheet that year. In exchange for ready cash Greece gave away future landing fees at the country’s airports. Ariadne, created in 2000, meant forfeiting the revenue from its national lottery. These appeared on the books as sales rather than loans.

There were more such deals, all effectively mortgaging the future of a country with such a proud past, and threatening European and in fact global economic stability.

The Plot Thickens in Greece

An update from the currency exchange firm World First.

The story in the markets at the moment is Greece. A country that contributes roughly 2% of the EU’s GDP could contribute to the downfall of the biggest single currency experiment since cavemen fashioned tokens from shiny rocks.

But it won’t. The Union must come first. A poll in the German paper Bild am Sonntag showed that the 53% of respondents wanted Greece thrown out of the EU and over 60% were adamant that German money should not be paid to the Greeks in the form of a bailout. Germans obviously have short memories; it was the beggar thy neighbor approach to crisis in 2008 that extended the downturn. A similar lack of foresight would likely see this Hellenic hell spiral down deeper.

Angela Merkel is a canny political operator; you have to be to become the first female Chancellor. The fact is that the German economy is exposed to the PIIGS heavily. German investment in Portuguese, Irish, Italian, Greek and Spanish debt roughly equates to 19% of German GDP ($3.65 trillion in 2008). $693.5bn; so roughly the same size as the Polish economy or half the size of Canadian GDP. Germany simply can’t afford to let Greece or any other EU members go bust. Doing so would leave a hole in their finances so monstrous that the rest of the EU would implode.

There is a split in the ruling coalition with one politician going as far to say “Solving this problem cannot be about aid for Greece. If anything, it’s about keeping any damage away from German taxpayers.”

The outlook for the euro is, as a result, weak. Hedge Funds and the speculative fraternity will look to drive the currency to its knees as rumor and uncertainty continues to swirl. The EU economy was the least well equipped to deal with the problems that the credit crunch and the winds of austerity brought to its shores.

There is a meeting going on between European finance ministers to discuss the Greek problem Change in a normal state normally moves in painfully slow increments. Greece cannot wait forever though; if no bailout is forthcoming by April then the Uk along with its European neighbors, will be entering a chapter of financial history that would truly define downturn.

Disclaimer: The above comments are the views of World First and should not be construed as advice. You should act using your own information and judgment. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgment as of the date of the briefing and are subject to change without notice.

Any rates given are “interbank” i.e. for amounts of £5million and thus are not indicative of rates offered by World First for smaller amounts. E&OE. Definitions of jargon/market terms can be found in our Glossary of Foreign Exchange Terms.

This financial promotion is issued in the United Kingdom by World First Markets Limited which is authorized and regulated by the Financial Services Authority (“FSA”) to provide advice on and execute trades in derivatives.  Please note that other activities that may be referred to in this material, such as the execution of spot foreign exchange trades, do not fall under the remit of the FSA.  World First Markets Limited’s FSA Firm Reference Number is 477561.

Investing in any of the hedging strategies contained in this material involves certain risks, for example that the exchange rate at expiry of the contract is less favorable than if you had entered into a forward contract.  Please ensure that you fully understand these risks before investing.  If you are in any doubt as to the nature of these risks, please speak with your financial adviser or an adviser at World First Markets Limited.

There are a number of charges that we will levy if you enter into a hedging strategy.  The nature of these charges depends upon the specific strategy, but may include an up front premium.  We recommend that you read carefully the details of these charges which are set out alongside the description of each strategy.

For your protection, telephone calls are usually recorded

For more information see World First.