Should I be buying as much U.S. dollars as I can right now?

[natalienicole]

What do I do to take advantage of the Canadian dollar being up? Might be a stupid question. Should I be going to the bank right now and buying as many U.S. dollars as I can? Then when the U.S. is higher than Canadian again switch it back? And should I do this now or wait? Should I borrowing whatever I can from my Credit line and doing this too?:confused:

[xlfe]

I guess...if u wanted to make the most of it you should have bought some when the canadian dollar hit peak, it's falling at the moment and banks are pretty much giving parity rates. I really wouldn't do it now cause the RISK is so much higher. If you burrow, you'd be paying interest which will eat away at any profits u may make.

Personally I don't think the USD will recover to it's former glory.

[Thalo]

You should have bought as much as you can last week.

If you can afford the risk, buy large blue-chip U.S. stocks (or a MF or ETF repesenting that class of companies, such as a DJIA ETF). Not only will they appreciate if the $CAD goes down, but the companies themselves are the biggest beneficiaries of a weak $USD (they operate in $USD and most of them have foreign income from global operations).

[BTron]

Good post Thalo, validates what I've been doing for the last month.

OP, you'd probably want to be thinking long term to do this, and borrowing money to invest in currency is likely to get you burned. If you're buying today thinking it's going to go from $1.02 back down to $0.90 you have to be willing to tolerate it swinging the same amount the other direction to $1.15 and continuing being patient. In the short term, if commodity prices rise and the US cuts the rate again, there's no way the US$ appreciates in value. However, the CDN$ has taken on proportionally far too much of the US$'s loss and it is damaging to our economy in the long term so will hopefully eventually come back.

[simms]

You should have bought as much as you can last week.

If you can afford the risk, buy large blue-chip U.S. stocks (or a MF or ETF repesenting that class of companies, such as a DJIA ETF). Not only will they appreciate if the $CAD goes down, but the companies themselves are the biggest beneficiaries of a weak $USD (they operate in $USD and most of them have foreign income from global operations).

I did that with my employee corporate stock program. Blue chip took a little bit a of a hit + high exchange rate meant I put like 10% of my salary into it to capitalize on the market :)

[Capt.]

Generally it's not a good idea to buy as much as you can of any one thing. Diversification is important and other factors such as age, risk tolerance, desired rate of return and knowledge come into play. In my opinion now is a pretty good time to buy US investments but no one can predict where our dollar will be in the next 6 months, year, 3 years, etc. I also don't like the idea of borrowing to invest.