The trading denomination is irrelevant for all assets (and hedging)

Cross-post. Yes, we’re still talking parallel to each other :wink:

Prepare to feel stupidity coming through your screen now, as I am pretty stupid in terms of currencies…
If I spend CHF to buy something in USD when USD has dropped 20% vs the CHF in my simple brain I am getting a 20% discount.

With examples: I want to get Stock A because I like it. Stock A is trading at $100, I don’t have $100 but I do have CHF1000 at hand and USD:CHF is 1, so CHF1000 get me 10 of Stock A.
If USD:CHF drops to 0.8 then my CHF1000 now buy 12 of Stock A plus $50 change. Is this right so far?

The question though for me remains: when the time comes that I want to sell Stock A, if it hasn’t appreciated over and above the 20% “discount” and any further devaluation of the USD vs any currency that’s useful to me (CHF, EUR) it would be losing money because I’d be getting back less money than I put up, isn’t it?

Edit: not being combative, it’s really something I struggle to get my head around.