Another key was geographical diversification to protect Cemex against the periodic collapse of the Mexican peso.
The Mexican peso is stronger against the dollar than it's been in a year and a half.
The two years following the Mexican peso devaluation in 1994 were among Citicorp's best in that country.
But in Mexican peso terms, that goes up to 10% to 11% because of the added foreign-exchange component.
Argentina's board helped keep its peso firmly fixed to the dollar when the Mexican peso collapsed three years ago.
Clinton took a big risk two years ago in supporting billions of dollars in loans to rescue the Mexican peso.
Many of the emerging currencies are strong, with the Turkish lira and Mexican peso up 6.6% versus the dollar last month.
The Mexican peso and Indian rupee had their best January performances since 1991, notching up gains in excess of 6% against the dollar.
Some of the region's monetary tightening in 1995 was also intended to reassure international investors shaken by the Mexican peso's dive a year ago.
Before November 2001, Lawrence had never invested in foreign currency other than trading U.S. dollars against the Mexican peso back when he was a busboy and waiter.
Having sought U.S. dollar exposure last year, we would expect to build our exposure to currencies like the Brazilian real, Mexican peso and Turkish lira in 2013.
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He did this after the 1987 stock crash, the Gulf War, the Mexican peso crisis, the Asian financial crises and the failure of one of the largest hedge funds.
When the Mexican peso was strong, he bought up foreign cement operations to attain additional economies of scale and diversification against the ups and downs of the Mexican economy.
Therefore, we continue to have an overweight position in Mexican sovereign bonds and the Mexican peso, and an overweight and growing exposure to Mexican corporate bonds in our portfolios.
When flows left equities and came into U.S. fixed income over the last several months, more demand for the dollar pushed currencies like the Brazilian real and Mexican peso lower.
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Lately the Australian dollar has been on a roller coaster, the Japanese yen can't shoot up fast enough and the Mexican peso lost 8 percent of its value in one day.
Furthermore, even though emerging markets wobbled in May and June, there was nothing like the panic (nor the wider economic impact) seen in 1994-95 after the Mexican peso devaluation, or in 1997-98, with the Asian crisis.
Within the Latin American forex space, the Mexican peso now looks more attractive from a carry perspective that is where low interest rate countries like Japan buy the local debt of higher interest rate countries.
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Modern currency crises the fracturing of Europe's exchange-rate mechanism in 1992, the Mexican peso crash in 1994, the collapse of East Asia's currencies in 1997, and the recent attacks on the Russian rouble are often blamed on them.
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On August 15th the Hong Kong Monetary Authority pushed interbank rates up to levels not seen since the Mexican peso crisis in 1995, to counter what it said was a speculative attack on the Hong Kong dollar.
Families in Mexico who depend on the income sent to them from workers abroad are also suffering from the unfavourable exchange rate of the Mexican peso against the US dollar - with the US dollar falling 8% this year.
Anyone who has studied or lived through the financial panics of 9-11-2001, the 1998 collapse of Long Term Capital Management, the 1989-1991 savings and loan disaster and the 1994 Mexican peso devaluation can remember that they were similar in magnitude.
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Instead of the sweeping proposals that have been championed since the Mexican peso crisis of 1994, Mr Eichengreen proposes a series of reforms, at both the national and multilateral level, to deal with the most pernicious problems of global capital flows.
Commodity currencies including the Russian rouble are responsive to expectations of a rise in commodity prices fuelled by Fed easing, while investors view the Mexican peso, along with the Canadian dollar, as a play on any economic recovery in the US because of their strong trade links.
"We've held a substantial long position in the Mexican peso since the beginning of the year, which has done very well, and we're going to keep that for the time being simply on fundamentals and attractive valuations, " said Dagmar Dvorak, an investment manager of fixed income and currencies at Baring Asset Management in London.
That's because so far the U.S. recession (if that's what we've got) is mainly tied to housing, a sector that doesn't affect Mexico much, he says, except as a drag on remittances sent by Mexicans working in the U.S. The Mexican peso's weakness against the euro has also helped drive up Mexico's exports to Europe.
Terrible timing--the Mexican government had just devalued the peso, throwing the economy into chaos.
If you own Mexican stocks, should you hedge your peso exposure?
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