The carry trade loses its lustre
given the low interest rate environment in South Africa, are there benefits to utilising a carry trade strategy? Although such a strategy is less applicable than in the past, it continues to exist and cannot be discounted.
Essentially, a carry trade is a trading strategy whereby an investor borrows money at a low interest rate to buy an investment that provides a higher rate of return, in order to generate a larger risk-adjusted profit. It is typically based on borrowing in a low interest rate currency and converting and investing
