How currency plays can help generate alpha in portfolios

Conjecture: The professionals' view - Currencies: risk, return or diversifier?

Having a currency overlay on either a bond or equity mandate is a useful way of generating alpha in a climate of moderate growth and falling interest rates

In an extended era of lowering global interest rates, moderate growth and muted stock markets some managers are able to generate alpha in their funds by looking to foreign exchange trades to enhance returns. With the story of a weak US dollar, a strengthening euro and a relatively stable sterling, last week's Conjecture debate dealt with currencies, risk, return or diversification. Bruno Crastes, chief investment officer and deputy CEO at Crédit Agricole Asset Management in London, joined Colin Harte, head of global government bonds at Baring Asset Management, to discuss current trends in...