Merk White Papers

"In an environment with increased correlations across most asset classes, portfolio diversification is of the upmost importance. The currency asset class may be attractive in this respect, as it exhibits very low correlations to many asset classes. Moreover, the unique attributes of the currency asset class may lead to inherent inefficiencies and profit opportunities. As such, currencies may provide investors with valuable portfolio diversification benefits, possibly providing superior risk/return characteristics to an overall portfolio..."

"Diversification has always been an important aspect of investing, and is an issue that has gained greater importance in light of recent market turmoil. When traditional asset classes move in the same direction simultaneously, investors have limited options in protecting against the downside. The currency asset class may meet this objective..."