ETFs and the 2010 Big Mac Index

Last Updated on Thursday, 18 March 2010 12:07 Written by admin Thursday, 18 March 2010 12:07

Seeking Alpha has once again published investment advice based on the 2010 Big Mac Index and ETFs that track the currencies in the Big Mac Index. In short, the Big Mac Index indicates that some currencies are undervalued and some are overvalued. If you invest long in the undervalued currencies and short in the overvalued currencies, you would profit since currencies tend toward Purchasing Power Parity.

Go long on these currencies:

Chinese Yuan (CYB)
Russian Ruble (XRU)
South African Rand (SZR)
Mexican Peso (FXM)
British Pound (FXB)

Go short on these currencies:

Swiss Franc (FXF)
Euro (FXE) or (long ultrashort EUO)
Canadian Dollar (FXC)
Australian Dollar (FXA)

Click here to see the rest of this article at SeekingAlpha.com.


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Chinese Yuan

Last Updated on Wednesday, 7 April 2010 12:22 Written by admin Wednesday, 17 March 2010 05:37

Chinese Yuan in the Big Mac Index

Big Mac Big Mac Actual Implied PPP Valuation relative
Local Dollars Exchange Rate of the $ to the $
1992 6.3 1.16 5.44 2.88 -89%
1993 8.5 1.50 5.68 3.73 -34%
1994 9.0 1.03 8.70 3.91 -55%
1995 9.0 1.05 8.54 3.88 -55%
1996 9.6 1.15 8.35 4.07 -51%
1997 9.7 1.16 8.33 4.01 -52%
1998 9.9 1.20 8.28 3.87 -53%
1999 9.9 1.20 8.28 4.07 -51%
2000 9.9 1.20 8.28 3.94 -52%
2001 9.9 1.20 8.28 3.90 -53%
2002 10.5 1.27 8.28 4.22 -49%
2003 9.9 1.20 8.28 3.65 -56%
2004 10.4 1.26 8.34 3.59 -57%
2005 10.5 1.27 8.37 3.43 -59%
2006 10.5 1.31 8.03 3.39 -58%
2007 11.0 1.45 7.60 3.23 -58%
2008 12.5 1.83 6.83 3.50 -49%
2009 12.5 1.83 6.83 3.50 -49%
2010 . 1.83 . . -49%

Current Value of the Chinese Yuan

Chinese Yuan Renminbi Exchange Rate

Chinese Yuan ETFs

WisdomTree Dreyfus Chinese Yuan Fund (CYB)

WisdomTree Dreyfus Chinese Yuan Fund seeks to achieve total returns reflective of both money market rates in China available to foreign investors and changes in value of the Chinese Yuan relative to the U.S. dollar.

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