Client Experience

The Key to a Dream Home in Madrid

Clients use multicurrency loans for a variety of purposes. For those based in the United States, two of the foreign-currency strategies most often used are for purchasing property overseas or expressing an investment view on currency movements.

For a client purchasing a home in Madrid, a $5 million credit line denominated in sterling facilitated the purchase of a desirable residential property without taking on currency risk.

“Our client bought the residence in sterling and will repay the loan with the same currency when she sells the property in a few years,” says her Capital Advisor.

Solving for several objectives

An investment client found that a multicurrency line of credit allowed him to accomplish several objectives: With proceeds from a $20 million credit line denominated in euros, he funded several private investments he had been considering.

“A multicurrency loan allowed our client to accomplish several objectives”

“The private investments offer an opportunity for appreciation to cover his cost of capital,” says his Capital Advisor, noting that depositing the funds into a savings account for this purpose would be impossible, given today’s low interest rates. “Meanwhile, our client has the larger potential of his currency position paying off.”

In each instance, using funds from a line of credit allowed a client to avoid having to sell other assets or securities, and avoid the risk of disrupting investment positions.

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All case studies are shown for illustrative purposes only and should not be relied upon as advice or interpreted as a recommendation. Results shown are not meant to be representative of actual investment results. Past performance is not necessarily indicative of the likely future performance of an investment.