Do you know how the dollar variation can impact your investments? If not, then know that this is a very common question for investors.
Thinking about different aspects of the market before investing your money can be the best alternative to protect your assets from this type of variation.
Because it is considered one of the main currencies in the world, the dollar can directly impact your income.
How does the dollar change?
The first point you need to understand about this subject is why the dollar fluctuation occurs.
It is directly linked to the amount of dollars in the Brazilian economy today.
When there are large amounts of dollars circulating in Brazil, it is customary for their value to fall in relation to our currency, the real.
On the other hand, the lack of dollars in the Brazilian economy causes their value to rise dramatically.
What can affect currency quotes?
The main factor that affects the price of the American currency here in Brazil is the law of supply and demand. But she is not the only one.
This variation can also be affected by the Brazilian and world economy, and therefore, it is necessary to be aware of our interest rate.
When this rate rises, public bonds become more advantageous, which attracts investors from outside the country.
And this causes the amount of dollar in Brazil to increase, decreasing its current price.
See how dollar quotes can impact your investments
Now that you know more about the currency, let’s see how the change in the dollar can impact your investments.
If the dollar suffers increases due to the high interest rate, other investments, such as fixed income, may also benefit.
However, increases in this rate can occur due to high inflation, and the higher the inflation, the higher the nominal return will need to be.
The stock exchange is also involved in the impacts of dollar variations on its investments.
Well, those who sell to the foreign market can see their profits increase, while those who sell only here in Brazil can have losses.
Why is it important to know this?
In addition to knowing how the dollar variation can impact your investments, it is necessary to know about it for several other reasons.
After all, the rises in the American currency impact our daily lives in general, as some products have their value linked to the value of the dollar.
And this increase can bring highs in our everyday purchases. So the more dollars we have in our economy, the bigger those highs will be.
How to build a career protected from the variation of the dollar
The best way to create a portfolio protected from this variation is to invest in safer assets.
Bonds pegged to inflation rates, for example, can be an excellent alternative.
To learn more about the options available for your profile, then consult a broker, and find out what it takes to protect your wallet.
Now that you know how the dollar variation can impact your investments, research the market more and protect yourself!
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