Trading currencies as baskets or indices enables investors to take a generalised view on a particular currency (eg the US dollar) rather than a specific view on a currency pair (eg EUR/USD).
FX Select, launched in March 2005, enables investors to inject active currency alpha into their investment portfolios on a fully portable, multi-manager basis. This greatly enhances the efficiency and expected return of a tactical or strategic asset allocation to FX, simultaneously improving expected returns and decreasing correlation to existing returns.
According to Rashid Hoosenally, global head of the client strategies and solutions group: “Our approach is to work as a solutions-driven house and, working on specific client problems, we tend to develop at least one new risk management idea a month, generally in response to a specific client need. This gives us a powerful toolbox, which can be used for other clients with similar problems.”
