Hi Gaurav,
I agree with you on all point except Cash Issue. I have used all other points mentioned by you and some other points not mentioned by you as a counter balance against the cash issue and hence I have remained invested (as I said in my post above that i give mgmt. the benefit of doubt).
Your Interest rate point would have been valid if it was a conversion on the basis of prevalent interest rates in both countries. In this case however the comparison is between cost of funds (domestic interest payments on Loans) Vs the advantage of converting at a better conversion rate. hence I don’t think the example provided by you is valid. It would have been valid if one wants to convert to take benefit by investing the converted money into say a govt. bond. Going by the invesment mgr. logic the same investment mgrs. also withdraw money when the interest rates in US go up. In short I don’t think your example here is valid as the cost of holding onto this funds (domestic interest payments) is higher Vs. the benefits of converting it after another 3% upmove.
I have replied only ‘coz I find the interest rate logic given above as flawed in this scenario.
I agree that same point shouldn’t be repeatedly discussed, but at the same time I think one should reserve the right to criticize a mgmt. if the response provided is not adequate.
With all due respect.
Regards.
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