Investing in and Speculating on the Iraqi Dinar

Investing in and Speculating on the Iraqi Dinar

(The Hype Surrounding the Investment Opportunity Explained)

The Hype Introduced

There is quite a bit of information and speculation flying around out there about the Iraqi Dinar. Many following this speculative investing in the foreign currency of Iraq (currently classified as “exotic” by the IMF), feel their investment in this currency will make them worth millions.

The Numbers Explained

Using the table below, we’ll do our best to help you see the potential gains many hope for in this investment.

Referring to the numbers below, you can see if you own just 1 million Dinar (IQD), which at the moment would cost you just $1,210 through The Currency Vault, and if the rate were to be adjusted to just a single penny ($.01), your $1,210 investment would be worth $10,000! Similarly, should the Iraqi Dinar revalue to $.50 (just one half of one US dollar), your same $1,210 investment would be worth $500,000 (half a million dollars)!

Beyond that, you can let your imagination run wild, and you can see that we have done just that in some of the scenarios we’ve created within the table below. The point being, is that there is a LOT of anticipation about the exchange rate change of the official currency of Iraq, the Iraqi Dinar.

As is mentioned on our home page, a single Iraqi Dinar, at one time, was worth $3.20. Yes, you understand correctly. Not too long ago, the US Dollar was worth less than the Iraqi Dinar, and not just by a little! A single US Dollar (USD) was worth less than 1/3 of a single Iraq Dinar (IQD).

So, continuing on with our speculation discussion, and mirroring the hopes and dreams of thousands who have chosen to place their investment hopes in the anticipated restructuring, rebuilding, and redevelopment of the country of Iraq, if the Central Bank of Iraq, along with the International Monetary Fund (IMF), were to reinstate Iraq’s currency’s value back to pre-war status, your $1,210 investment in one (1) million Dinar would be worth $3,210,000! Yes, that’s over $3 MILLION DOLLARS! That’s what all the hype is about, and why so many are aware of the potential of this unique foreign currency investment.

Regional Currency Rates Comparison

To help further deepen your understanding about the possibilities of this investment, you don’t need to look too far to see just how realistic an exchange rate change can be for the country of Iraq. The table below shows the rates of the neighboring countries surrounding Iraq, and within the Arab region..

As you can see above, if all Iraq does is raise its currency rate to the level of the least expensive currency of the entire Arab region of countries, which happens to be Saudi Arabia as of 2/25/11, that would place the IQD with a rate of approximately .27 cents per US Dollar. At that rate, an investor’s one (1) million Dinar holding would be worth $267,000 US Dollars! An investment, that once again, only cost them $1,210.

The Investor’s Justification – A Dose of Reality

Many investors, online personalities, and speculators have claimed they know when when the revaluation will occur, and most of those dates have come and gone. There are still others who say it will never happen, it’s too good to be true, and that it’s just plain impossible. Still, most who have invested in the Iraqi Dinar firmly believe owning even a small amount of Dinar will ultimately pay off and be the road to their financial future!

Many, regardless of whether they believe in the speculative returns discussed above, have chosen to create exposure for themselves within this investment. Why? Because no one really knows the outcome of this speculative play. Even the most skeptical of investors justify their small exposure in this investment as worth the risk, as the potential leverage of such an investment where you can invest so little and get such a massive return is at the very least justifiable risk-taking on an amount they personally have chosen to invest, or even gamble to some extent.

They reason that investing in the Iraqi Dinar could even be a hedge against their concerns over the falling of the US Dollar, feeling Iraq has maybe already seen the worst of their situation, and are a nation rebuilding themselves. They figure the worst that can happen is they lose a percentage of their money, or even all of it should they be unable to find an outlet that would purchase their Dinar from them, but that the upside is so much greater. After all, they say, it’s not a stock, but a real currency of a country on the up-swing.

It’s Your Call…

So, the speculation continues, and only you as an investor can weigh the risks and determine how you feel about the potential rewards. Either way, understanding all the risks, being aware of the reasons for your investment, and deciding on a prudent amount to invest, if at all, that matches your personal and financial circumstances, is your call.