What to do with multiple currencies?

For residents of the United Arab Emirates.
Post Reply
Topic Author
outofdxb
Posts: 4
Joined: Fri Feb 14, 2020 4:23 am

What to do with multiple currencies?

Post by outofdxb »

Hi all,

I find myself in a unique situation with regards to currencies. While I live in the UAE, due to the nature of my job, I get paid in GBP and EUR. I have about AED200k cash here in UAE, and over the long term it's likely (but not certain), I will go back home to New Zealand to live and retire.

So with this in mind, what should I be doing with these different currencies and investing? Should I be converting everything to NZD (with the expectation that is where I will live) and then buy into the ETFs?

This leads me to another question. To invest in a European ETF, do I require Euros to buy into that ETF? Or can I use NZD?

Thanks.
homebuyer6426
Posts: 1830
Joined: Tue Feb 07, 2017 8:08 am

Re: What to do with multiple currencies?

Post by homebuyer6426 »

I think that whatever you do, you should be minimizing the number of times in the future that you're likely to need to convert currencies, as you will lose some to the exchange rate each time.

You could have multiple conversions if you made everything New Zealand dollars and then realized you weren't going to live there.

So perhaps the best strategy would be to convert "as needed" for the near-term to give you a degree of flexibility.

But another point is that some currencies are more likely to experience volatility than others. Some expose you to more political risk. That's complicated and you have to use your own best judgement.

The question about ETFs will depend on your broker. I have bought Japanese stocks with dollars from my US account, but there was a fee.
45% Total Stock Market | 52% Consumer Staples | 3% Short Term Reserves
Post Reply