I have decided to invest in the new Autonomies fund but the fact that I live inside the Eurozone poses a problem. My income and liquid assets are in Euros. The euro seems to be oversold against sterling. I am tempted to make a small invest in the Autonomies fund now and wait for a rally in the euro to increase my investment. What is your opinion on this strategy? 

Eoin Treacy's view

Thank you for this topical question and for your interest in the Autonomies fund, which will begin trading on March 27th. The Euro found at least short-term support on Friday versus the British Pound so there is scope for some short-term steadying. 

With the Bank of England becoming nervous about the strength of the Pound and the Euro having been so weak it is natural to ask whether this is the opportune time to buy Pounds. If you were thinking of buying a house in London this would be a major question. However, if you are buying a basket of internationally listed securities whose earnings are truly international, the risk to the performance of the portfolio from the Euro/Pound exchange rate is not the same as if you were buying a UK share listed share whose earnings are all in Pounds. 

Take a look at this spreadsheet of the Autonomies ranked by percentage of earnings that are dependent on their country of domicile. The vast majority generate more than 40% of earnings from outside their home market. More than half generate greater than 60% of revenue from outside their home country.