Paul Tudor Jones Is Extremely Bullish About Asian Currencies

It isn’t very easy to garner any insights from Paul Tudor Jones’ 13F filings. He is usually a short term trader with hundreds of small meaningless positions. Fortunately, we have his latest investor letter and have an idea about what he is thinking. Tudor Jones currently thinks that Chinese and Asian currencies are significantly undervalued against the U.S. dollar. In order to keep their export driven economies humming, these countries opted to import dollar inflation. Jones estimates that Chinese RMB is 35% – 72% cheaper against the U.S. dollar than in 1993. This is what Jones suggests U.S. should do:

“It could intervene in the foreign exchange market against the Hong Kong dollar, and exert its influence on what is by definition a bilateral, not unilateral, exchange rate. This is no different from what Asia does everyday to the U.S. and would speed up RMB appreciation. Just as a matter of prudent reserve management, the U.S. could also intervene against other Asian currency suppressors to diversify its foreign exchange reserves.”

Paul Tudor Jones thinks Asian currencies are poised to appreciate significantly and he is betting accordingly. At the end of December, he had the following long positions in his portfolio:

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