The Hong Kong dollar is pegged to the US dollar. As a general proposition this has been a good thing for Hong Kong, not merely because it offers a small economy which is closely associated with a number of emerging markets a degree of financial stability but because it forces the Hong Kong government to maintain large reserves to defend that peg and makes it difficult for spendthrift politicians to tax and spend to the unsustainable levels seen in a number of other countries.
Regardless of how beneficial the peg has been, it means that my earnings and many of my assets are effectively denominated in US dollars and are depreciating when measured against a number of other currencies and commodities.
I had a small amount of money left after funding the purchase of the new property (settlement is tomorrow) and decided to invest in something which should be inversely correlated with the US dollar. My choices were other currencies (e.g. Australian or New Zealand dollars), a commodity ETF (which I already hold) or precious metals. I chose silver. Although it has had a great run, it remains volatile, which is attractive from a trading perspective. In terms of fundamentals, silver's industrial uses are also a positive factor.
Since physical silver is not readily available in Hong Kong, I invested using a notional precious metals account.
My purchase price was HK$134.6 (US$17.25) per ounce.
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