Investing in the Mexican Peso

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Investing in the Mexican Peso

Post by Beliavsky »

A 08 August 2022 report by BoA economist Carlos Capistran, available on Merrill Edge says
Banxico will likely make another big hike
We expect Banxico to increase its policy rate target by 75bp to 8.5% on August 11 in a
unanimous decision. If there is a split it would likely be for a larger hike. We expect
Banxico to increase its inflation forecasts and a statement that stresses high inflation,
deteriorating inflations expectations and large Fed hikes. The risk is for a 100bp hike.

How far will Banxico hike?
We expect Banxico to keep a spread of about 600bp with the Fed. This would allow
Banxico to keep the peso relatively strong (vs. other EM currencies).
Reuters says
Mexican inflation in July likely sped up again to a near-22-year high, a Reuters poll showed on Monday, fueling bets the country's central bank will continue to hike its key interest rate through the rest of the year.

The median forecast of 14 analysts projects that annual inflation will hit 8.13% in July, a level not seen since December 2000.
So current inflation in Mexico is slightly lower than in the U.S., and interest rates are much higher. One way to access higher Mexican interest rates is to buy peso currency futures, since they price in interest rate differentials. All the liquidity is in one month, currently September, and rolling the position monthly would be a slight hassle. How can Americans otherwise invest in the Mexican Peso (MXN) at high interest rates?

If higher real interest rates on cash are consistently higher in Mexico, this could make retiring in Mexico look attractive for Americans, since they could convert dollars to pesos and earn higher returns on cash, without taking currency risk since their expenses are also in pesos. According to data from the OECD, from 2000 to 2021, the real exchange rate of MXN vs. USD has fallen. In 2000, the cost of living was 55% higher in the U.S. than in Mexico, but by 2021 it was 102% higher. Can any Bogleheads living in Mexico confirm or refute this?

Code: Select all

year	PPP	USD/MXN	ratio
2000	 6.103	9.456	1.549
2021	10.043	20.272	2.019
Mean reversion in the MXN/USD real exchange rate would benefit investments in MXN. In the past Mexico has had bouts of high inflation. Trading Economics says the inflation rate in Mexico averaged 23.26 percent from 1974 until 2022. The central bank of Mexico targets 3% inflation. I don't know how high the risk is of a return to high inflation in Mexico, which would cause currency depreciation.
User avatar
JoMoney
Posts: 16260
Joined: Tue Jul 23, 2013 5:31 am

Re: Investing in the Mexican Peso

Post by JoMoney »

If you don't have expenses/liabilities denominated in some foreign currency, "investing" in it is inherently a very risky time/situation specific trade. Certainly not something a "passive investor" should be engaging in.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham
Always passive
Posts: 1267
Joined: Fri Apr 14, 2017 4:25 am
Location: Israel

Re: Investing in the Mexican Peso

Post by Always passive »

The problem with currency is unpredictable, specially in the short term. Besides, if this information is public, you begin competing with big money, hedge funds, etc. Good luck trying to outsmart them
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

JoMoney wrote: Tue Aug 09, 2022 8:24 am If you don't have expenses/liabilities denominated in some foreign currency, "investing" in it is inherently a very risky time/situation specific trade. Certainly not something a "passive investor" should be engaging in.
People sometimes judge risk based on familiarity and thus overestimate the risk of the unfamiliar. September implied vol for Mexican Peso futures is 12.5%, for Treasury note futures it is 7.9%, and for the S&P 500 it is 19.2%. By this measure, investing in the Mexican Peso is more risky than in Treasury notes but less risky than in the S&P 500.
User avatar
Watty
Posts: 28859
Joined: Wed Oct 10, 2007 3:55 pm

Re: Investing in the Mexican Peso

Post by Watty »

Beliavsky wrote: Tue Aug 09, 2022 8:10 am Merrill Edge says.....
....
Reuters says.....
In theory what people are saying is already priced into the exchange rate and interest rates.
Beliavsky wrote: Tue Aug 09, 2022 8:10 am In 2000, the cost of living was 55% higher in the U.S. than in Mexico, but by 2021 it was 102% higher. Can any Bogleheads living in Mexico confirm or refute this?
One pitfall to watch at for is that the cost of living statistics may be based on living like an average Mexican. If you move there and you want to have a large place in a resort area with things like air conditioning, internet, a nice car, etc and keep an average American lifestyle that cost can be a lot different.

More than one person has moved to a low cost of living area only to find that to maintain their same lifestyle costs a lot more than they expected just because many of the things they want are considered luxuries and price accordingly.

You might find the Big Mac Index interesting. Click on Mexico then look at the chart on lower right to see how it has changed over time.

https://www.economist.com/big-mac-index
Beliavsky wrote: Tue Aug 09, 2022 8:10 am If higher real interest rates on cash are consistently higher in Mexico....
That is a big "if" which might not be realistic.
User avatar
nisiprius
Advisory Board
Posts: 52212
Joined: Thu Jul 26, 2007 9:33 am
Location: The terrestrial, globular, planetary hunk of matter, flattened at the poles, is my abode.--O. Henry

Re: Investing in the Mexican Peso

Post by nisiprius »

Mexican pesos. Nothing against the peso, specifically. But FOREX is always high risk and, theoretically zero return in the long run (due to "purchasing power parity").

But mentioning the peso did bring this to mind:
In 1978, in 'The Only Investment Guide You'll Ever Need,' Andrew Tobias wrote:[A] book explains how by converting your dollars to pesos you can earn 12% on your savings in Mexico instead of 5-1/2% here.... the author reassures, the peso is one of the stablest currencies in the world, having been pegged at a fixed rate to the dollar for 21 years, and the Mexican government has repeatedly stated its intention not to devalue. Now who the heck are you, who needed to buy a book to tell you about this in the first place, supposed to evaluate the stability of the Mexican peso? So, scared of the stock market and impressed by the author's credentials, you take el plunge.

And for 18 months you are getting all the girls. Because while others are pointing lamely to the free clock radios they are getting with their new 5-1/2% savings accounts, you are talking Mexican pesos at 12%.

Comes September, and Mexico announces that its peso is no longer fixed at the rate of 12.5 to the dollar, but will be allowed to "float." Overnight it floats 25% lower, and in a matter of days it is down 40%. Whammo....

(Everything changes and nothing changes. That was 1976. In 1982 the peso was devaluted again--by 80%. In 1995, it dropped 55%. From mid-2002 to mid-2004, it edged down 20%.)
Last edited by nisiprius on Tue Aug 09, 2022 10:28 am, edited 3 times in total.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
MarkRoulo
Posts: 1198
Joined: Mon Jun 22, 2015 10:25 am

Re: Investing in the Mexican Peso

Post by MarkRoulo »

Beliavsky wrote: Tue Aug 09, 2022 8:10 am A 08 August 2022 report by BoA economist Carlos Capistran, available on Merrill Edge says
Banxico will likely make another big hike
We expect Banxico to increase its policy rate target by 75bp to 8.5% on August 11 in a
unanimous decision. If there is a split it would likely be for a larger hike. We expect
Banxico to increase its inflation forecasts and a statement that stresses high inflation,
deteriorating inflations expectations and large Fed hikes. The risk is for a 100bp hike.

How far will Banxico hike?
We expect Banxico to keep a spread of about 600bp with the Fed. This would allow
Banxico to keep the peso relatively strong (vs. other EM currencies).
Reuters says
Mexican inflation in July likely sped up again to a near-22-year high, a Reuters poll showed on Monday, fueling bets the country's central bank will continue to hike its key interest rate through the rest of the year.

The median forecast of 14 analysts projects that annual inflation will hit 8.13% in July, a level not seen since December 2000.
So current inflation in Mexico is slightly lower than in the U.S., and interest rates are much higher. One way to access higher Mexican interest rates is to buy peso currency futures, since they price in interest rate differentials. All the liquidity is in one month, currently September, and rolling the position monthly would be a slight hassle. How can Americans otherwise invest in the Mexican Peso (MXN) at high interest rates?

If higher real interest rates on cash are consistently higher in Mexico, this could make retiring in Mexico look attractive for Americans, since they could convert dollars to pesos and earn higher returns on cash, without taking currency risk since their expenses are also in pesos.
... snip ...
From Andy Tobias' "The Only Investment Guide You'll Ever Need" (1983):
-- and you come upon the section on savings banks. Mexican savings banks.

The book explains how by converting your dollars to pesos you can earn 12% on your savings in Mexico instead of 5 1/2% here. At 12% after twenty years, $1,000 will grow not to a paltry $2,917, as it would at 5 1/2%, but to nearly $10,000! What's more, the book explains, U.S. savings banks report interest payments to the Internal Revenue Service. Mexican banks guarantee not to. Wink.

The book does warn that if the peso were devalued relative to the dollar, your nest egg would shrink proportionately. But, the author reassures, the peso is one of the stablest currencies in the world, having been pegged at a fixed rate to the dollar for 21 years; and the Mexican government has repeatedly stated its intention not to devalue. ... Anyway, what would be so dreadful if, as your savings were doubling and tripling south of the border, the peso were devalued 5% or 10%?

So, scared of the stock market and impressed by the author's credentials, you take el plunge.

And for 18 months you are getting all the girls. Because while others are pointing lamely to the free clock radios they got with their new 5 1/2% savings accounts, you are talking Mexican pesos at 12%.

Comes September and Mexico announces that its peso is no longer fixed at the rate of 12.5 to the dollar, but will, instead, be allowed to "float." Overnight it floats 25% lower, and in a matter of days it is down 40%. Whammo. Reports the New York Times: "Devaluation is expected to produce serious immediate difficulties, most conspicuously in heavy losses for Americans who have for years been investing dollars in high-interest peso notes." How much is involved? Oh, just $6 or $8 billion.

You are devastated. But you were not born yesterday. At least you will not be so foolish as to join in the panic to withdraw your funds. You may have "bought at the top" -- but you'll be damned if you'll sell at the bottom. The peso could recover somewhat. Even if it doesn't, what's lost is lost. There's no point taking your diminished capital out of an account that pays 12% so you can gt 5 1/2% in the United States.

And sure enough, in less than two weeks the float is ended and the Mexican government informally repegs the peso to the dollar. (Only now one peso is worth a nickel, where two weeks ago it was worth eight cents). You might not know much about international finance (who does?), but you know enough to sense that, like a major housecleaning, this 40% devaluation in Mexico's currency ought to hold it for a long, long time. In fact, you tell friends, for you own piece of mind you're just as glad they did it all at once rather than nibbling you to death.

And then six week later the peso is floated again, and slips from a nickel to less than four cents. Since Labor Day, you're down 52%.

Aren't you glad you bought that book?
I'd say you should go for it and just open a saving account in a Mexican bank!

:-)

Edit: Darn, I see nisi beat me to it!!!!!
JackoC
Posts: 4714
Joined: Sun Aug 12, 2018 11:14 am

Re: Investing in the Mexican Peso

Post by JackoC »

Beliavsky wrote: Tue Aug 09, 2022 8:10 am

1. ...current inflation in Mexico is slightly lower than in the U.S., and interest rates are much higher. One way to access higher Mexican interest rates is to buy peso currency futures, since they price in interest rate differentials. All the liquidity is in one month, currently September, and rolling the position monthly would be a slight hassle. How can Americans otherwise invest in the Mexican Peso (MXN) at high interest rates?

2. If higher real interest rates on cash are consistently higher in Mexico, this could make retiring in Mexico look attractive for Americans, since they could convert dollars to pesos and earn higher returns on cash, without taking currency risk since their expenses are also in pesos.
1. Currency carry trades have worked more often than not. It's in the 'persistent anomaly' or 'alternative premium' category. It's not guaranteed to work obviously, because you have to leave the currency exposure open. Which suggests diversifying it among a bunch of 'high carry' assets and as one 'alternative premium' play among several as in the extensively discussed AQR sponsored fund QSPIX (to summarize dozens of pages of discussion: diversification requires leverage to fit everything in and results in lower transparency; very high ER by stock index fund standards; ups and downs performance-wise over the years discussed here; basic question: can premia like carry persist no matter how widely recognized?). Just doing this for one currency I doubt as a strategy unless you have some connection to the country. One theory for the success of currency carry trades in past is the premium is payment for accepting more inflation uncertainty in some currencies than others, which would not invalidate it but move it more firmly from 'anomaly' to 'alternative risk premium'.

2. That should be true seems to me. Savers with expenses in currency X are better off than savers with expenses in currency Y if the real interest rate on safe cash is consistently higher in X than Y. Though savers with expenses in Y can't do anything about this without taking risk. Whatever efficiency/convergence process is required for that not to be true doesn't seem to work fast and well enough to reject the idea in the real world. It would also seem though only one small factor in retiring from the US to Mexico if not exactly on the fence about it otherwise.
alex_686
Posts: 13320
Joined: Mon Feb 09, 2015 1:39 pm

Re: Investing in the Mexican Peso

Post by alex_686 »

What time frame are you looking at.

In theory, on first order principles, FX trading should not generate economic profits. i.e., above the risk free rate. Reality is a bit tricker. There are second order principles that should pay off plus speculation. But these are always going to be tactical decisions. The items you cite can change on a dime.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
Valuethinker
Posts: 49030
Joined: Fri May 11, 2007 11:07 am

Re: Investing in the Mexican Peso

Post by Valuethinker »

JackoC wrote: Tue Aug 09, 2022 10:22 am
Beliavsky wrote: Tue Aug 09, 2022 8:10 am

1. ...current inflation in Mexico is slightly lower than in the U.S., and interest rates are much higher. One way to access higher Mexican interest rates is to buy peso currency futures, since they price in interest rate differentials. All the liquidity is in one month, currently September, and rolling the position monthly would be a slight hassle. How can Americans otherwise invest in the Mexican Peso (MXN) at high interest rates?

2. If higher real interest rates on cash are consistently higher in Mexico, this could make retiring in Mexico look attractive for Americans, since they could convert dollars to pesos and earn higher returns on cash, without taking currency risk since their expenses are also in pesos.
1. Currency carry trades have worked more often than not. It's in the 'persistent anomaly' or 'alternative premium' category. It's not guaranteed to work obviously, because you have to leave the currency exposure open. Which suggests diversifying it among a bunch of 'high carry' assets and as one 'alternative premium' play among several as in the extensively discussed AQR sponsored fund QSPIX (to summarize dozens of pages of discussion: diversification requires leverage to fit everything in and results in lower transparency; very high ER by stock index fund standards; ups and downs performance-wise over the years discussed here; basic question: can premia like carry persist no matter how widely recognized?). Just doing this for one currency I doubt as a strategy unless you have some connection to the country. One theory for the success of currency carry trades in past is the premium is payment for accepting more inflation uncertainty in some currencies than others, which would not invalidate it but move it more firmly from 'anomaly' to 'alternative risk premium'.

2. That should be true seems to me. Savers with expenses in currency X are better off than savers with expenses in currency Y if the real interest rate on safe cash is consistently higher in X than Y. Though savers with expenses in Y can't do anything about this without taking risk. Whatever efficiency/convergence process is required for that not to be true doesn't seem to work fast and well enough to reject the idea in the real world. It would also seem though only one small factor in retiring from the US to Mexico if not exactly on the fence about it otherwise.
I thought the argument for the "carry anomaly" was some combination of:

- there are participants in currency markets who are not risk minizers-return maximisers. Central Banks in particular act to keep currencies too low (in developed countries, generally) and too high (developing countries, particularly those with current account deficits) and this creates an arbitrage opportunity. As we have seen of late with Sri Lanka and Turkey.

You have big players in the markets, big enough to meaningfully affect valuations, who are there to serve the national interest, rather than to make money trading currency. China, for exactly that reason, prevents currency speculation.

You also have individuals and companies, who trade FX to facilitate other purposes: sending money home, or paying for needed components etc. Remittances can be a big part of FX trading for some currencies.

- although "Uncovered Interest Parity" is violated by the success of the carry trade, it is a "Black Swans" investment strategy ie one vulnerable to large and sudden event risk. For example you could get 15% on your Icelandic bank deposits up until mid 2007, and then things started to go really wrong. Eventually Iceland defaulted on private sector debts, devalued the currency and imposed currency controls. The USD:JPY rate moved 14% in one day during the 1997-98 SE Asia Crisis. The HKD nearly fell to a speculative attack but was probably saved by quiet armtwisting by the PRC (which didn't want to inherit damaged goods from Britain).

I recall being told that "UIP works. But the data is noisy"?
psteinx
Posts: 5801
Joined: Tue Mar 13, 2007 2:24 pm

Re: Investing in the Mexican Peso

Post by psteinx »

JackoC wrote: Tue Aug 09, 2022 10:22 am 1. Currency carry trades have worked more often than not. It's in the 'persistent anomaly' or 'alternative premium' category. It's not guaranteed to work obviously, because you have to leave the currency exposure open.
Currency carry used to be promoted as a diversifying investment. In particular, there was an ETF created around the time this idea was popular. That ETF has *NOT* done well.
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

psteinx wrote: Tue Aug 09, 2022 10:55 am
JackoC wrote: Tue Aug 09, 2022 10:22 am 1. Currency carry trades have worked more often than not. It's in the 'persistent anomaly' or 'alternative premium' category. It's not guaranteed to work obviously, because you have to leave the currency exposure open.
Currency carry used to be promoted as a diversifying investment. In particular, there was an ETF created around the time this idea was popular. That ETF has *NOT* done well.
That (DBV) trades in G10 (developed market currencies). An ETF that is more closely related to long Mexican peso is EMB, iShares JP Morgan USD Em Mkts Bd ETF. Over Jan 2008 - Jul 2022 the optimal portfolio of SPY, IEF, EFA, EEM, EMB (S&P 500, Treasury notes, foreign developed stocks, emerging market stocks, emerging market bonds) contains only SPY and IEF. EMB had a higher Sharpe ratio and EFA and EEM. If one would exclude emerging market bonds based on past performance, foreign stocks would also be suspect, but many Bogleheads (certainly not all) own foreign stock index funds.

Another poster mentioned crash risk in emerging market currencies, which does exist, but the S&P 500 also has crash risk.
User avatar
nisiprius
Advisory Board
Posts: 52212
Joined: Thu Jul 26, 2007 9:33 am
Location: The terrestrial, globular, planetary hunk of matter, flattened at the poles, is my abode.--O. Henry

Re: Investing in the Mexican Peso

Post by nisiprius »

If you want to do it, it's your money and your life. But it is still a zero-sum game or something close to it, and it seems to me that almost every year you read headlines about some giant bank losing a few billion dollars on a bad currency bet.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
JackoC
Posts: 4714
Joined: Sun Aug 12, 2018 11:14 am

Re: Investing in the Mexican Peso

Post by JackoC »

Beliavsky wrote: Tue Aug 09, 2022 11:17 am
psteinx wrote: Tue Aug 09, 2022 10:55 am
JackoC wrote: Tue Aug 09, 2022 10:22 am 1. Currency carry trades have worked more often than not. It's in the 'persistent anomaly' or 'alternative premium' category. It's not guaranteed to work obviously, because you have to leave the currency exposure open.
Currency carry used to be promoted as a diversifying investment. In particular, there was an ETF created around the time this idea was popular. That ETF has *NOT* done well.
That (DBV) trades in G10 (developed market currencies). An ETF that is more closely related to long Mexican peso is EMB, iShares JP Morgan USD Em Mkts Bd ETF. Over Jan 2008 - Jul 2022 the optimal portfolio of SPY, IEF, EFA, EEM, EMB (S&P 500, Treasury notes, foreign developed stocks, emerging market stocks, emerging market bonds) contains only SPY and IEF. EMB had a higher Sharpe ratio and EFA and EEM. If one would exclude emerging market bonds based on past performance, foreign stocks would also be suspect, but many Bogleheads (certainly not all) own foreign stock index funds.

Another poster mentioned crash risk in emerging market currencies, which does exist, but the S&P 500 also has crash risk.
EMB is as you say *USD* denominated EM bonds so it's only indirectly related to the monetary policy/local interest rates in the currency of the issuer. The relatively more direct way would be local currency denominated EM bonds, like the ETF EMLC*. Although that's obviously not a pure currency carry play, average maturity ~7yrs so depends on term govt bond rates in the currencies not short FX market interest rates (which aren't necessary the same as even official short rates).

EMLC avoids the issue of concentrating in one or very few currencies you'd be limited to with currency futures (besides size issue there to have a bunch of contracts, for most investors). And sometimes on this forum there seems an implicit assumption the US stock market is basically riskless, if you hang on long enough (and 'you don't lose anything till you sell', amiright? :happy ). So somebody can say 'all the EM currencies can go down v USD at once, did you ever think of that, genius?' as if the US stock market can't also go down a lot. Diversification of sources of *risky* return beyond the Equity Risk Premium (or even just the US ERP) is the idea. Suggestion of a fund like EMLC isn't supposed to mean a portal to a new universe of much higher riskless return.

Driving with steady focus on the rearview mirror (a short range rearview mirror) almost no risk asset beats US stocks. But that's not a good way to drive IMO. Though I'm not suggesting avoiding US stocks, I have loads of exposure to them.

And people have made tons of money over time on currency carry trades, that's not refuted by some ETF concentrating in DM currencies not having done well lately. The trade *can* do badly, no doubt about that: the spot just has to move against you as much or more as the interest rate differential says it's 'supposed' to. Sometimes it does, but more often than not it hasn't. Also some previous posts seem to refer to currencies that are pegged (or de facto) which is a bit different game (in the pure currency carry arena, also applies in EMLC to the now biggest component, China, around 10%).

*about 3% of assets for me, mainly built up recently, a big portion of my limited tax deferred space, wouldn't make much sense in taxable.
User avatar
quantAndHold
Posts: 10141
Joined: Thu Sep 17, 2015 10:39 pm
Location: West Coast

Re: Investing in the Mexican Peso

Post by quantAndHold »

Currency trading is one of the riskiest, most speculative kinds of trading out there, right up there with that digital thing which shall not be named. People make, and lose, large amounts of money on currency trades, and exchange rates will often go in the opposite direction of what the experts are predicting.

Anyway, if you’ve got some spare change lying around that you want to speculate with, go for it, but Bogleheads is probably not the right place to get any useful how-to information. It’s just not what most of us are into.
User avatar
windaar
Posts: 1673
Joined: Thu Mar 08, 2012 6:31 am

Re: Investing in the Mexican Peso

Post by windaar »

Jack Bogle would say, no, stop, don't.
Nobody knows nothing.
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

quantAndHold wrote: Tue Aug 09, 2022 2:07 pm Currency trading is one of the riskiest, most speculative kinds of trading out there, right up there with that digital thing which shall not be named.
You can get a lot of leverage via currency futures, but you don't have to use it. If you own $100K of Mexican pesos via futures, that is less risky than $100K in the S&P.
User avatar
typical.investor
Posts: 5263
Joined: Mon Jun 11, 2018 3:17 am

Re: Investing in the Mexican Peso

Post by typical.investor »

Beliavsky wrote: Tue Aug 09, 2022 8:10 am I don't know how high the risk is of a return to high inflation in Mexico, which would cause currency depreciation.
Maybe ... maybe even probably and I used the think that way given the whole dollar parity things but no, not necessarily.

Did high inflation in the '70s in the US cause currency depreciation? Is it causing it now? (hint: yes, no) Why the change?

Yes: Nominal rate increases due to an inflation shock will cause currency depreciation. We saw this in the late '70s.

No: A rise in real interest rates (nominal rate minus inflation) will cause currency appreciation. It's why we often see a puzzling rise in USD when rates go up as has recently happened. This is said to be as market forces should equalize the investment return between two countries as seen below:
Real Interest Rate + Expected Appreciation in Real Exchange Rate = Foreign Real Interest Rate
So, if a country's real interest rate is higher, the market must be expecting its real exchange rate to depreciate.

Assuming the real exchange rate is constant in the long run, the only way the market can expect the real exchange rate to depreciate in the future is for the real exchange rate to increase today. "What must go down in the future, must go up today".

Not that this changes anything for you, but FX is complicated I think and between the flow of good/services and central bank activity and currency supply ... well good luck in being one of the few who can do it. I am not doubting you here - only doubting my ability to possibly keep up with the changes.

Anyway, that's my understanding of the Kansas Fed piece ...https://www.kansascityfed.org/documents ... hip%3F.pdf
sreynard
Posts: 375
Joined: Thu May 02, 2013 8:11 pm

Re: Investing in the Mexican Peso

Post by sreynard »

Wow, this is back again? Everybody that saw people get burned last time must have all retired (the people that got burned were escorted out the door...)

You know you're old when the same stupid idea keeps coming back. Again. And again...
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

JackoC wrote: Tue Aug 09, 2022 2:00 pm EMB is as you say *USD* denominated EM bonds so it's only indirectly related to the monetary policy/local interest rates in the currency of the issuer. The relatively more direct way would be local currency denominated EM bonds, like the ETF EMLC*. Although that's obviously not a pure currency carry play, average maturity ~7yrs so depends on term govt bond rates in the currencies not short FX market interest rates (which aren't necessary the same as even official short rates).
Thanks for the correction. Over Jan 2011 - Jul 2022 EMLC has done badly, with a CAGR of -1.60%, vs. 2.90% for EMB. That could mean that investing in emerging market local currency debt is a bad idea, or that EM currencies are now cheap. I did show that MXN has depreciated more against USD than the inflation differential since 2000.
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

sreynard wrote: Tue Aug 09, 2022 3:14 pm Wow, this is back again? Everybody that saw people get burned last time must have all retired (the people that got burned were escorted out the door...)

You know you're old when the same stupid idea keeps coming back. Again. And again...
Vanguard recently published
Why we're bullish on emerging markets debt
by Dan Shaykevich
Senior Portfolio Manager and Co-manager of Vanguard Emerging Markets Bond Fund
August 1, 2022
Financial markets have already factored current fundamental risks into prices. As of June 30, the J.P. Morgan Emerging Markets Global Bond Index Diversified yield stood at 8.57%. For comparison, this yield just touched 8% during the peak of the COVID liquidity crisis in March of 2020, and the last time we saw these levels was in the aftermath of the global financial crisis. The more than 22% drawdown since the middle of September 20211 already exceeds the worst drop in 2020 and is within 5% of the peak drawdown in 2008.
User avatar
happyisland
Posts: 915
Joined: Thu Oct 03, 2013 1:36 pm
Location: nos baranca tan stima

Re: Investing in the Mexican Peso

Post by happyisland »

These kinds of threads are fascinating to me:

Step 1) the OP presents an investing thesis that is, let's say, "non-standard" in the Boglehead world.
Step 2) a bunch of kind-hearted experts volunteer their time to analyze and shoot holes in the thesis.
Step 3) the OP ignores the virtual unanimity of advice and continues to argue for their thesis.

One would think that people would heed the solid, and almost unanimous, advice they get on a forum like this. Otherwise, what is the point of posting?
User avatar
quantAndHold
Posts: 10141
Joined: Thu Sep 17, 2015 10:39 pm
Location: West Coast

Re: Investing in the Mexican Peso

Post by quantAndHold »

Beliavsky wrote: Tue Aug 09, 2022 2:47 pm If you own $100K of Mexican pesos via futures, that is less risky than $100K in the S&P.
So, this is the ten year chart of MXN/USD:
Image


And this is the chart for SPY:
Image

The Mexican Peso has been drifting downwards for the last 50 years, sometimes slowly, sometimes quickly. The fact that it currently has less volatility than the S&P 500 doesn’t make it less risky.

At best, this is a short term speculation, which is speculation, not investment. Long term, it’s a loser. Either way, it’s not something Bogleheads are going to be able to give a lot of advice on, since it’s not what we do.

Edit: got the charts mixed up.
DesertDiva
Posts: 1555
Joined: Thu Mar 01, 2018 11:49 am
Location: In the desert

Re: Investing in the Mexican Peso

Post by DesertDiva »

The only person I recall who dabbles in pesos is user rchmx1. He is an expat with an actual need to cover living expenses.

Read his interesting strategy at viewtopic.php?p=6408617
User avatar
arcticpineapplecorp.
Posts: 15080
Joined: Tue Mar 06, 2012 8:22 pm

Re: Investing in the Mexican Peso

Post by arcticpineapplecorp. »

is this really:
Investing Advice Inspired by Jack Bogle
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
invest2bfree
Posts: 1279
Joined: Sun Jan 12, 2020 8:44 am

Re: Investing in the Mexican Peso

Post by invest2bfree »

Beliavsky wrote: Tue Aug 09, 2022 8:10 am A 08 August 2022 report by BoA economist Carlos Capistran, available on Merrill Edge says
Banxico will likely make another big hike
We expect Banxico to increase its policy rate target by 75bp to 8.5% on August 11 in a
unanimous decision. If there is a split it would likely be for a larger hike. We expect
Banxico to increase its inflation forecasts and a statement that stresses high inflation,
deteriorating inflations expectations and large Fed hikes. The risk is for a 100bp hike.

How far will Banxico hike?
We expect Banxico to keep a spread of about 600bp with the Fed. This would allow
Banxico to keep the peso relatively strong (vs. other EM currencies).
Reuters says
Mexican inflation in July likely sped up again to a near-22-year high, a Reuters poll showed on Monday, fueling bets the country's central bank will continue to hike its key interest rate through the rest of the year.

The median forecast of 14 analysts projects that annual inflation will hit 8.13% in July, a level not seen since December 2000.
So current inflation in Mexico is slightly lower than in the U.S., and interest rates are much higher. One way to access higher Mexican interest rates is to buy peso currency futures, since they price in interest rate differentials. All the liquidity is in one month, currently September, and rolling the position monthly would be a slight hassle. How can Americans otherwise invest in the Mexican Peso (MXN) at high interest rates?

If higher real interest rates on cash are consistently higher in Mexico, this could make retiring in Mexico look attractive for Americans, since they could convert dollars to pesos and earn higher returns on cash, without taking currency risk since their expenses are also in pesos. According to data from the OECD, from 2000 to 2021, the real exchange rate of MXN vs. USD has fallen. In 2000, the cost of living was 55% higher in the U.S. than in Mexico, but by 2021 it was 102% higher. Can any Bogleheads living in Mexico confirm or refute this?

Code: Select all

year	PPP	USD/MXN	ratio
2000	 6.103	9.456	1.549
2021	10.043	20.272	2.019
Mean reversion in the MXN/USD real exchange rate would benefit investments in MXN. In the past Mexico has had bouts of high inflation. Trading Economics says the inflation rate in Mexico averaged 23.26 percent from 1974 until 2022. The central bank of Mexico targets 3% inflation. I don't know how high the risk is of a return to high inflation in Mexico, which would cause currency depreciation.
Problem with Emerging Market Currencies is there is only one way against the dollar. They constantly depreciate.

Compare that against CAD$, AUD$, SGD$ or Euro it is a Sinusoidal wave.
36% (IRA) - Individual LT Corporate Bonds , 33%(taxable) - schy, 33%(taxable) - SCHD Dividend Growth
Valuethinker
Posts: 49030
Joined: Fri May 11, 2007 11:07 am

Re: Investing in the Mexican Peso

Post by Valuethinker »

invest2bfree wrote: Tue Aug 09, 2022 10:06 pm

Problem with Emerging Market Currencies is there is only one way against the dollar. They constantly depreciate.

Compare that against CAD$, AUD$, SGD$ or Euro it is a Sinusoidal wave.
I burst out laughing.

SGD$ - Singapore *was* an Emerging Market. In fact still classified as one, AFAIK.

If one says "Emerging Markets Currencies constantly depreciate" and then count countries where that is not the case as "not Emerging" well then, you have something which is tautologically true?

I agree there's a set of countries - and I would include the UK in them - that seem to be on a one way course to devalue their currencies. Argentina is of course top of the list. Brasil - except it's a commodity superstate.

Whilst there might be a case, around the improving credit quality of some EMs, for holding EM "local" bonds (see Jack of C posts)-- I don't think there is a case for speculating on the exchange rate between USD & any particular EM currency.

(The EM bond story I see more being about improved credit quality rather than undervalued exchange rates per se. Most successful EMs contrive to keep their currencies undervalued against USD on a PPP basis - this discourages consumption and encourages export industries and it's the only long term development strategy (along with universal healthcare and education*) that has been shown to work).

* that gives you the demographic dividend. Rapid falls in birthrates lead to a low dependency ratio. Lots of young, educated workers to work in these new industries. Singapore did it. China did it. Ireland did it. Even Bangladesh has made quite a start compared to the basket case it was at independence from Pakistan in 1971. Also a population which is less sick is more productive.
dboeger1
Posts: 1411
Joined: Fri Jan 13, 2017 6:32 pm

Re: Investing in the Mexican Peso

Post by dboeger1 »

OP, have you considered just investing in Mexican businesses? In addition to all the reasons others have already given for FOREX speculation being incredibly difficult/risky, a big one is just that holding an unproductive asset (cash) at the expense of being able to hold more productive assets (equities) is fundamentally a losing proposition in the long term. While I don't think there's much reason to favor companies doing business in one currency over another, if you really want exposure to a foreign currency, investing in businesses denominated and generating revenues in that currency seems like a logical way to do it without having to hold cash. Of course, this has its own problems, like whether the businesses that meet these criteria are sufficiently diversified for your purposes. In general, the publicly traded US equity markets have very large overall market cap and deep penetration into our developed, globalized economy, which is why it's not unreasonable to just hold US equities as a proxy for global growth. In many emerging markets, publicly traded stocks represent a much smaller fraction of the much smaller economy, so you may be taking on a lot of idiosyncratic risk for the sake of gaining additional exposure to the currency. Just be careful that you're not taking some huge concentrated risk (unless that's what you want). I would never even consider doing this, but if I did, I would only do it with a tiny portion of my portfolio.
sreynard
Posts: 375
Joined: Thu May 02, 2013 8:11 pm

Re: Investing in the Mexican Peso

Post by sreynard »

Valuethinker wrote: Wed Aug 10, 2022 2:54 am
invest2bfree wrote: Tue Aug 09, 2022 10:06 pm

Problem with Emerging Market Currencies is there is only one way against the dollar. They constantly depreciate.

Compare that against CAD$, AUD$, SGD$ or Euro it is a Sinusoidal wave.
I burst out laughing.

SGD$ - Singapore *was* an Emerging Market. In fact still classified as one, AFAIK.

If one says "Emerging Markets Currencies constantly depreciate" and then count countries where that is not the case as "not Emerging" well then, you have something which is tautologically true?

I agree there's a set of countries - and I would include the UK in them - that seem to be on a one way course to devalue their currencies. Argentina is of course top of the list. Brasil - except it's a commodity superstate.

Whilst there might be a case, around the improving credit quality of some EMs, for holding EM "local" bonds (see Jack of C posts)-- I don't think there is a case for speculating on the exchange rate between USD & any particular EM currency.

(The EM bond story I see more being about improved credit quality rather than undervalued exchange rates per se. Most successful EMs contrive to keep their currencies undervalued against USD on a PPP basis - this discourages consumption and encourages export industries and it's the only long term development strategy (along with universal healthcare and education*) that has been shown to work).

* that gives you the demographic dividend. Rapid falls in birthrates lead to a low dependency ratio. Lots of young, educated workers to work in these new industries. Singapore did it. China did it. Ireland did it. Even Bangladesh has made quite a start compared to the basket case it was at independence from Pakistan in 1971. Also a population which is less sick is more productive.
I burst out laughing at your laughing. :D

"Emerging Market" is a euphemism. Most are not emerging from or to anything. Unless on a geologic timeframe... It lumps together countries that are both "emerging" and have no intention of "emerging".

Every country on Earth devalues it's currency. They either do it obviously or sneakily; fast or slow. (At least I'm unaware of any that don't.) I do not include Macao.
sreynard
Posts: 375
Joined: Thu May 02, 2013 8:11 pm

Re: Investing in the Mexican Peso

Post by sreynard »

happyisland wrote: Tue Aug 09, 2022 4:57 pm These kinds of threads are fascinating to me:

Step 1) the OP presents an investing thesis that is, let's say, "non-standard" in the Boglehead world.
Step 2) a bunch of kind-hearted experts volunteer their time to analyze and shoot holes in the thesis.
Step 3) the OP ignores the virtual unanimity of advice and continues to argue for their thesis.

One would think that people would heed the solid, and almost unanimous, advice they get on a forum like this. Otherwise, what is the point of posting?
+1 :sharebeer
Step 0) the OP already decided to follow the investing thesis.

Often used strategy to attempt a "Pump and Dump" on other forums. "I bought/sold short <fill in the blank>, you should too..."
(Did crypto just come to mind?) :wink:
JackoC
Posts: 4714
Joined: Sun Aug 12, 2018 11:14 am

Re: Investing in the Mexican Peso

Post by JackoC »

Beliavsky wrote: Tue Aug 09, 2022 4:46 pm
JackoC wrote: Tue Aug 09, 2022 2:00 pm EMB is as you say *USD* denominated EM bonds so it's only indirectly related to the monetary policy/local interest rates in the currency of the issuer. The relatively more direct way would be local currency denominated EM bonds, like the ETF EMLC*. Although that's obviously not a pure currency carry play, average maturity ~7yrs so depends on term govt bond rates in the currencies not short FX market interest rates (which aren't necessary the same as even official short rates).
Thanks for the correction. Over Jan 2011 - Jul 2022 EMLC has done badly, with a CAGR of -1.60%, vs. 2.90% for EMB. That could mean that investing in emerging market local currency debt is a bad idea, or that EM currencies are now cheap. I did show that MXN has depreciated more against USD than the inflation differential since 2000.
Again based on the even 10-20 yr rearview mirror you'd concentrate in large cap US tech, not even just the whole US index. Why go looking for alternative sources of risky return when you already have the perfect risk asset? QQQ's all the way, baby! (back in 2002 before I knew it was wrong to, I loaded up on the Q's, do I get to keep the money? :happy ) But seriously, strongly favoring investments on recent good performance is not a good general idea as I'm sure you agree. Though it's not as easy either as looking for what recently did badly and knowing it will do better. It might continue to do badly. But diversification is about some things doing better and other things doing worse. If you know what's going to do best, don't diversify but concentrate in that superior thing. My problem is I don't know the superior thing looking forward.

And seems to me EM local currency bond has some fundamental reasons to not perform so similarly to either DM (besides just US) stock or EM stock over a longer period. It does and I'd expect it to continue to follow 'risk on/risk off' moves of stocks directionally on a short term basis but over time it's a fairy different financial claim, bond claim on tax bases of various EM countries in own currency vs. equity claim on the generally internationalized and often somewhat dollarized businesses of big EM co's which dominate EM stock index, and pretty obviously different than equity claim on DM businesses. A key again though is to get past the mental block of comparing EM local bonds to US govt bonds for USD investors, as many off hand rejections of the idea here seem to. The argument for EM local bonds is diversification of sources of *risky* return not replacement for (near) riskless return.
User avatar
nisiprius
Advisory Board
Posts: 52212
Joined: Thu Jul 26, 2007 9:33 am
Location: The terrestrial, globular, planetary hunk of matter, flattened at the poles, is my abode.--O. Henry

Re: Investing in the Mexican Peso

Post by nisiprius »

sreynard wrote: Wed Aug 10, 2022 9:30 amStep 0) the OP already decided to follow the investing thesis.
Often used strategy to attempt a "Pump and Dump" on other forums. "I bought/sold short <fill in the blank>, you should too..."
(Did crypto just come to mind?) :wink:
I don't think anything Beliavsky posts in forums is likely to move the peso market much. This isn't any "pump and dump" scheme.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
Valuethinker
Posts: 49030
Joined: Fri May 11, 2007 11:07 am

Re: Investing in the Mexican Peso

Post by Valuethinker »

sreynard wrote: Wed Aug 10, 2022 9:18 am

I burst out laughing at your laughing. :D

"Emerging Market" is a euphemism. Most are not emerging from or to anything. Unless on a geologic timeframe... It lumps together countries that are both "emerging" and have no intention of "emerging".
Actually most of those are "Frontier" markets? If you read the late Hans Rosling's book, the world has made extraordinary progress in the last 60 years. There is the risk of reversion, to be sure. Some places - mostly in sub Saharan Africa but also in the war-torn parts of the Middle East - have gone backwards. But average income per capita. Literacy. Life expectancy. Infant mortality. Total Fertility Ratio (down in that case). These are very different places than they were in 1960.

Some countries seem to crash up against some fundamental barrier - the "Middle Income Trap".

I was just laughing at the characterisation of Singapore Dollar as a currency of a "developed country". When it is not classified as such, and it is within the last 60 years that Singapore has become a "first world" country. I had an anecdote about my uncle's memories of the place as a soldier in the late 1940s... but deleted it as not relevant.
Every country on Earth devalues it's currency. They either do it obviously or sneakily; fast or slow. (At least I'm unaware of any that don't.) I do not include Macao.
Tautologically untrue. You can't all devalue your currencies, because "devalue" means relative to another currency. A currency in terms of units of another currency. Used to be against GBP, nowadays taken usually against USD. But not only.

You are talking about inflation & the effect on buying power? That's very dependent upon how we measure inflation. It might broadly be true, although Japan of course is the counterpoint. Adjusted for hedonic improvements (essentially, technology change) Japan's price level was more or less static for 2 decades - Abenomics & global price shocks might finally have broken that (but it's still only 2%).
Topic Author
Beliavsky
Posts: 1233
Joined: Sun Jun 29, 2014 10:21 am

Re: Investing in the Mexican Peso

Post by Beliavsky »

nisiprius wrote: Wed Aug 10, 2022 9:57 am
sreynard wrote: Wed Aug 10, 2022 9:30 amStep 0) the OP already decided to follow the investing thesis.
Often used strategy to attempt a "Pump and Dump" on other forums. "I bought/sold short <fill in the blank>, you should too..."
(Did crypto just come to mind?) :wink:
I don't think anything Beliavsky posts in forums is likely to move the peso market much. This isn't any "pump and dump" scheme.
Yes, thanks. I can't move the USDMXN market, and interest rate differentials, which are what I wrote about, are public information. A few people questioned my posting here. The focus of some FX forums, for example Reddit/forex, is technical analysis and short-term trading. The prospect of earning say 6% unleveraged by owning a basket of high yielding EM currencies is not what they are about.
sreynard
Posts: 375
Joined: Thu May 02, 2013 8:11 pm

Re: Investing in the Mexican Peso

Post by sreynard »

Beliavsky wrote: Wed Aug 10, 2022 10:21 am
nisiprius wrote: Wed Aug 10, 2022 9:57 am
sreynard wrote: Wed Aug 10, 2022 9:30 amStep 0) the OP already decided to follow the investing thesis.
Often used strategy to attempt a "Pump and Dump" on other forums. "I bought/sold short <fill in the blank>, you should too..."
(Did crypto just come to mind?) :wink:
I don't think anything Beliavsky posts in forums is likely to move the peso market much. This isn't any "pump and dump" scheme.
Yes, thanks. I can't move the USDMXN market, and interest rate differentials, which are what I wrote about, are public information. A few people questioned my posting here. The focus of some FX forums, for example Reddit/forex, is technical analysis and short-term trading. The prospect of earning say 6% unleveraged by owning a basket of high yielding EM currencies is not what they are about.
Please see my quote, "...on other forums". I did not say the OP and I did not say here.
The only useful purpose served by "technical analysis" is to make astrology and palm reading look good. People see what they want to see and will justify it with their dying breath.
Nobody is talking about short-term trading. We are talking about
The prospect of earning say 6% unleveraged by owning a basket of high yielding EM currencies
There is a reason they are "high yielding". Why do you think that is? Maybe because the risk is way, way higher? Like equities high? Is that the risk in good times, or does that include the risk when the next "unexpected" event happens and they collapse, again. Because that's one of the properties of "Emerging" vs. "Emerged" markets. They collapse again.

It's funny, it used to be a common strategy by the big banks to "invest" in the Mexican Peso. Banks like J.P. Morgan, BofA, UBS, Credit Suisse, Deutsche Bank, etc. They have all said it was a nice, safe, conservative investment. And then they were wrong. They would lose billions, 'brilliant' managers would get walked out the door, the banks would get bailed out, and then it would go out of favor for a decade or so. Everybody would forget, and sure enough, banks would begin "advising" it again... Looks like a new cycle. Which suggests it may just be the worse time to "invest" in EM currencies.

But it's your money. If you want to invest in EM currencies, or Crypto, or NFTs, go for it. You just may make more than a plain old total stock/international/bond portfolio. It will certainly be more exciting. Just don't expect a "Boglehead" to think EM currency investing is a good idea. [Unless you live, work, or invest in the country in question, of course. Then it may be useful.]
JackoC
Posts: 4714
Joined: Sun Aug 12, 2018 11:14 am

Re: Investing in the Mexican Peso

Post by JackoC »

sreynard wrote: Wed Aug 10, 2022 11:20 am
Nobody is talking about short-term trading. We are talking about
The prospect of earning say 6% unleveraged by owning a basket of high yielding EM currencies
There is a reason they are "high yielding". Why do you think that is? Maybe because the risk is way, way higher? Like equities high?
But it's not being proposed (I certainly wouldn't) to replace equities, but to diversify away from sole reliance on the Equity Risk Premium, especially just the *US* ERP, as sole source of risky return. The aim to diversify sources of risky return doesn't make each suggestion to do so automatically a good idea. However, establishing that something different from (US or global) equities has risk doesn't make it a bad idea either. It's, obviously, a matter of return relative to risk, and diversification. I'd estimate expected return of US stocks now be something like 6% nominal (1.7% dividend, 1.5% long term historic real EPS growth, assume no more tailwind of increasing valuation as in recent decades but no headwind of contracting valuations, plus long term inflation expectation around 2.5%, rounds to 6) so saying something different than US stocks with expected return 6% is a bad idea if it has US equity like risk isn't fully convincing.

As I said, I see the problem with this idea, just doing MXN, as sizing it efficiently. If you concentrate in one currency you can't do much without it being a concentration of something pretty idiosyncratic, one country's currency, not as idiosyncratic as a single stock but kind of like that. And it's not that easy to do a bunch of them DIY with either futures or rolling short forward FX trades AFAIK. Again, I'd suggest the somewhat related idea of EM local currency govt bonds. The SEC Yield of EMLC is in this same ballpark (7.21% recently), and it's partly a play on currency carry though has other source of return (and risk) related to the term govt bond rates in the different countries. It's risky certainly, but so are stocks and again the idea would be to diversify sources of risky return beyond just stocks, not to replace stocks.
User avatar
danbdzs
Posts: 90
Joined: Mon Feb 17, 2020 5:29 pm

Re: Investing in the Mexican Peso

Post by danbdzs »

Beliavsky wrote: Wed Aug 10, 2022 10:21 am
nisiprius wrote: Wed Aug 10, 2022 9:57 am
sreynard wrote: Wed Aug 10, 2022 9:30 amStep 0) the OP already decided to follow the investing thesis.
Often used strategy to attempt a "Pump and Dump" on other forums. "I bought/sold short <fill in the blank>, you should too..."
(Did crypto just come to mind?) :wink:
I don't think anything Beliavsky posts in forums is likely to move the peso market much. This isn't any "pump and dump" scheme.
Yes, thanks. I can't move the USDMXN market, and interest rate differentials, which are what I wrote about, are public information. A few people questioned my posting here. The focus of some FX forums, for example Reddit/forex, is technical analysis and short-term trading. The prospect of earning say 6% unleveraged by owning a basket of high yielding EM currencies is not what they are about.

MXN is up close to 10% against the USD since the OP posted and you'd have a larger difference had you been in MXN treasuries!

The pump seems to have worked :wink:

What a wierd world we live in.
User avatar
Hacksawdave
Posts: 807
Joined: Tue Feb 14, 2023 4:44 pm

Re: Investing in the Mexican Peso

Post by Hacksawdave »

The only Mexican Pesos I have ever invested in were 30 5 Peso Aztec Cuauhtemoc silver coins dated 1947-1948 back in 2003. Paid around $5.75 for each one. That’s the only venture and success I have ever had investing in Mexican currencies.

Hacksawdave
Post Reply