IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Carry Trade with Maintained Currencies - A Risk and Return Analysis for the Egyptian Pound

  • Christian Kalhoefer


    (Faculty of Management Technology, The German University in Cairo)

  • Sara Shenouda

    (Faculty of Management Technology, The German University in Cairo)

  • Ahmed Badawi

    (Faculty of Management Technology, The German University in Cairo)

Registered author(s):

    The forward premium puzzle in the exchange rate market, resulting from the deviation and failure of interest rate parity, has awakened the interest of speculators to perform carry trade activities. Across literature the main risk associated and measured for carry trade has been the exchange rate risk and crash risk related to the relevant currencies used. But within the literature, the influence of maintained currencies on the carry trade results has not yet been covered. This paper analyzes the potential performance and the risk of carry trade strategies within a maintained exchange rate regime. For this analysis an empirical study of carry trade strategies applied between the EGP and other currencies has been used and compared to those with the USD as an example for a maintained exchange rate. Our risk and return analysis clearly shows a combination of high return and low risk for the maintained currency carry trade.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    File Function: First version, 2010
    Download Restriction: no

    Paper provided by The German University in Cairo, Faculty of Management Technology in its series Working Papers with number 24.

    in new window

    Length: 15 pages
    Date of creation: Dec 2010
    Date of revision:
    Handle: RePEc:guc:wpaper:24
    Contact details of provider: Web page:

    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:guc:wpaper:24. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lobna Sameer)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.