This is a follow up on a short video on Financial times on Danish Krone. For investors with exposure to euro zone, it might be a good idea to use Danish Krone as a hedge. For speculators it could be a profitable bet in short run. Currently the Krone is pegged to the euro with a band of 2.25 percent of 746.038 per 100 euro. There has been evidence of Danish government intervening in the FX market to keep the krone trading at its mid level. Interest rate cuts beyond the ECB cuts hints at the scale of the speculative money inflow.

If the Greeks do decide to leave, things will kick off in the Euro zone. The inflow of money into Swiss, Danish and the US will intensify. In the short time the the trading band might be increased to reflect the appreciation of the krone. If the Euro crumbles then the Krone might be pegged to the German Currency giving rise to a stronger currency in the short term. It might not be such a bad idea to follow the herd this time around.