Is bad exchange rate reason to change investment strategy?


here is what I am seeking input on:

I earn EUR (out of CH atm :frowning_face: ), and invest in USD (at IB) and EUR (DeGiro), ~90% at IB in USD. The exchange rate EUR → USD is relatively bad at the moment. Should I adjust my investing decisions, and how?

  1. Keep investing mainly in USD, even if I buy less USD for my EUR.
  2. Invest in EUR instead of USD (**).
  3. anything else?

(**) this will lead to slightly more complex portfolio, but I am actually currently considering shifting more to EUR so it would not be too much of a problem

I will be grateful for answer that includes explanation, even with references for some reading/listening, on the reasoning.

This may be somewhat basic question related to understanding on risk of investing in different currencies. My understanding was that the return is largely independent of currency you invest in, provided you have to exchange back at some moment. However I am curious how somewhat extreme events, such as terrible exchange rate at the moment you are forced to exchange, influence the result.

Thanks so much for your input!

1 Like

Listing currency doesn’t matter when investing in stocks or stock funds (as long as there is no currency hedging). See Non-Relevance of ETF Quotation Currency (and various other threads).


Currency doesn’t matter at all, because you are eventually buying a real thing (the company).

It’s almost the same as if you were buying an ingot of gold. It wouldn’t matter if you buy it directly with EUR, or if you exchange your currency to CHF or USD first, you always get the same amount of Gold.

1 Like