New-Wave Investments
New-Wave Investments: How to Profit from Multicurrency Investing
A Taipan Publishing Group Strategy Report
By Gary Scott, Contributor, Taipan Publishing Group
Gary Scott, our insider in South America, tells us why now, even as the market tanks, is a time of special opportunity for adventurous early investors
When I moved to Hong Kong in 1968 it was the beginning of a bear market similar to the one that Wall Street (and most of the world) is experiencing now.
At that time stock investing was dominated by New York. That was about to end. In 1968 the Hong Kong Stock Market began to explode upwards along with Tokyo’s market. What a ride!
Hong Kong's Hang Seng Index was then 100 and rose to 18,000 over two decades. Early investors who steadily committed money to this market made a fortune.
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New-Wave Investments: Last Four Decades of Opportunity
Since that time numerous waves of opportunity have presented themselves to those who were willing to look ahead, see and invest in a new opportunity at times when most are feeling that doom has begun. I can sum up how great the last four decades of opportunity have been in four phrases.
#1: 1970s. A wave of investments in gold, silver and shares in Japan, Germany, Switzerland and Hong Kong were unorthodox and created fortunes. Investors who simply invested in gold, Japanese yen, German marks and Swiss francs saw their money triple and quadruple in just a few years.
#2: 1980s. Investments of shares in Japan, Taiwan, Singapore, Malaysia and South Korea boomed. For example, some Japanese warrant (warrants are a form of long-term options) mutual funds rose over 1,000% in a less than two years.
#3: 1990s. Another wave of shares, this time in South America, shot up. For example, Foreign & Colonial, the largest offshore Latin fund shot up from 100 pounds a share to 231 in four years and then ran up to 309 pounds a share by 1999.
#4: 2000s. Shares in China, India and Asian emerging markets took off. An Emerging Asian Portfolio we developed with one of Denmark's largest banks, Jyske Bank, consisting mostly of Chinese and Indian shares, rose 114.16% in 2006 and 151.64% in 2007.
New-Wave Investments: Current Wave of Opportunity
These ideas in their times were new and each created fortunes for early investors willing to step in. The current wave of opportunity is in alternate energy and the environment.
For example working again with Jyske Bank, in 2007 we created a Green Multicurrency Portfolio. The idea of this portfolio was to enhance capital value through holding shares in businesses that help grapple with rising energy costs and environmental concerns.
The starting date for the portfolio was November 1, 2006. Here is the 2007 Green Portfolio:
| Currency | Name of Company | Invested Amount |
| Euro | Seche Environnement | 48,000 |
| Danish Kroner | Novozymes B | 48,000 |
| Danish Kroner | Vestas Wind Systems | 51,000 |
| Japanese Yen | Kurita Water Industr.6370 | 51,000 |
| Euro | Q-Cells Ag | 51,000 |
| Singapore | Hyflux Ltd | 51,000 |
| Total Investment | $300,000 |
(One reason we used this Danish bank is that most European banks will also make loans in low interest currencies to leverage investments. Jyske Bank specializes in this tactic.)
New-Wave Investments
We invested $100,000 and used a 1.88% Japanese yen loan of $200,000 for a total $300,000 investment. That portfolio rose 266.30% over the next year. In November 2007 the portfolio was worth $366,300, after loan payoff. The profit was $266,300 on the $100,000 originally invested.
This green portfolio, like the rest of the world's markets, dropped badly again at the beginning of 2008, but has surged back strongly, rising nearly 50% at a time when most equities around the globe are floundering.
Here’s what you should keep in mind: Change brings turmoil as new economics replace those of old. Each new wave of technology that change brings requires early investors during the initial times of turmoil. Those early investors are the buccaneers, and they seemingly take bigger risks... But as change touches the world at an ever-increasing pace, those who learn how to manage this risk may find the new-wave investments safer as well as the biggest opportunities of all.
You can learn more about Gary’s multicurrency investing technique right here.
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Originally published July 30, 2008.
Copyright 2007-2008, The Taipan Publishing Group and Taipan Daily, 808 St. Paul St., Baltimore, MD 21202. All rights reserved. No part of this report may be reproduced or placed on any electronic medium without written permission from the publisher. Information contained herein is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed.