There are many ways to profit from a falling Australian dollar and the latest currency movements could afford you a great opportunity.
At the weekend the Australian dollar edged back above US82 cents after falling rapidly from around US94 cents in September to a five-and-a-half year low of just US80.33 cents last week.
Once considered a safe haven for foreign investment, the Australian dollar, is being tipped to keep falling. Our own RBA Governor, Glenn Stevens, recently said the AUD continues to be overvalued.
"Probably US75 cents is better than US85 cents," Mr Stevens said in an interview with The Australian Financial Review in early December. "Some further adjustment is going to have us much more like normal historical levels, at least against the US dollar and maybe some others."
Mr Stevens made a similar statement in late 2013 and after a few months of resistance, the dollar began to fall.
At the same time as the US economy rebounds; locally higher unemployment, a fading mining boom, lower GDP growth and weaker consumer confidence continue to point to a lower dollar in 2015.
Oddly enough much of the currency's falls do not appear to be priced into shares of Australian-listed companies with significant US exposure, who'll benefit from the recent – and any future – falls in the AUD.
Packaging company Amcor Limited (ASX: AMC), share registry firm Computershare Limited (ASX: CPU), investment bank Macquarie Group Ltd (ASX: MQG) and logistics giant Brambles Limited (ASX: BXB) are examples of three Australian blue-chips which will benefit from a recovering US economy.
Foolish takeaway
Despite the recent rebound in value, the Australian dollar appears destined for further falls. However investors can still benefit from its downward trend by investing in solid dividend-paying shares in companies with significant overseas exposure, such as those above.
