re. Rica Bjork. I’m not quite getting how she is short GBP in the write up so we need to go long SEK to account for the 7% loss in the portfolio. To be clear, I understand the need for “lower” the exposure, but in my mind she is long the GBP along with the investment in the UK. Appreciate any clarification. Thanks! /kjartan
They have assets denominated in GBP, so they’re long GBP on those assets. The SEK/GBP exchange rate is hedged with a forward contract, so they’re short GBP and long SEK in the forward contract.
Thank you that makes sense!
You’re welcome.