A simple flow indicator

An alternative way of assessing currency flow is the ratio between the ETFs of each currency. For example, the EZU that gives exposure to a developed market countries using the Euro currency, divided by IVV that gives exposure to large, established U.S. companies.

The direction of this ratio shows us whether companies in one country (or region) are growing faster than the other. The greater the growth of companies, the greater the country growth and productivity, which creates a virtuous cycle and currency appreciation.
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