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CADSGD trade ideas

buy buy property - CADSGDSince I started investing in forex, it has not occurred to me that property investment has a lot to do with forex. Look at this beautiful and timely chart. We know that in many countries like Canada, Australia and even China that the government is indeed clamping down on the properties market. It used to be C$1= S$1.70 in 2007. Fast forward 10 years later, 2017, C$1 = S$1.07. That means Canadian dollar has weaken against Sing Dollars, giving it less purchasing power compared to 10 years ago. In other words, for those who earn canadian dollars, it may not be so good to spend their canadian dollars here in Singapore when it is close to parity. On the other hand, those earning S$ would be happy to know that they can buy things cheaper in Canada compared to 10 years ago. However, property prices over the last 10 years, especially in Canada has gone up the roof and the government is trying ways and means to cool its ultra hot property market. It has declined about 10% since April. Would it drop another 20% or more? It is anyone guess - new Fed rate hike, mortgage bubble, debt ceiling, new property measures by Canada government to curb speculation and many more. Assuming the price of property do come down by another 20% within the next few years, it may be a good proposition to consider investing property in Canada using S$ according to the chart. If it does go back up to 1.40 from its current 1.07, that is more than 30% increment or 3343 pips profit. It took about 6 years from 2010 at the price of 1.40 to 0.98 in 2016, more than 4000 pips downfall ( or profits if you short it). The profits made from buying CADSGD can be plough back into a property in Canada (taking advantage of its price adjustment within the next 5 years or so) and riding on a longer time frame (10 years or more) for better yield returns. Please note that not all countries are friendly in terms of foreign investment in properties. It can be ownership, legal titles or bank loan challenges or even politics that deter foreigners from buying. For example, if one would look at SGD/MYR pair, it has been on an upward bullish trend. Many of my Malaysian friends are not buying a 2nd property there for investment as they feel the price is quite depressed for years and little room for appreciation. Many developments are aimed at foreigners, shouting at 1,000,000 MYR or more but on closer scrutiny, there are not many who are willing to rent the units. If the rental cannot covers the mortgage that one is paying for, it means a tighter cashflow for the investor. I am not a property agent and thus this view is strictly my own and serves as an education and not a call to buy/sell. Please exercise your own due diligence as property investment requires capital outlay and more research work is needed.
Long
by dchua1969