Should you buy these 3 shares to bet on a lower Aussie Dollar?

Where is the Australian dollar headed next? It wasn’t so long ago that our currency was approximately worth the same as the US Dollar, and investors were keen to benefit from what was an obvious aberration.

Now the Aussie dollar is buying $0.75 US Dollars, but if US interest rates are rising, our interest rates are still falling, and/or we’re heading into a recession as some predict, our dollar could be set for another fall. Here are 3 possible ways to benefit:

Cochlear Limited (ASX: COH)

This hearing aid developer and manufacturer earns more than 90% of its revenues and has 50% of its costs in currencies other than the Australian Dollar, which makes it an ideal way to gain exposure to a falling AUD. Unfortunately, at today’s prices, much of that benefit already appears to be priced in, and Cochlear earns in a diverse range of currencies which makes it a less clear beneficiary.

ResMed Inc. (CHESS) (ASX: RMD)

ResMed’s Australian listing is a CHESS depository instrument for the common stock listed on the New York Stock Exchange (NYSE). Every 10 ASX ResMeds is the equivalent of 1 ordinary share on the NYSE. With the common stock priced in US Dollars and the dividends paid in US Dollars (and converted to AUD for CHESS depository holders), ResMed is a very clear way to benefit from a decline in the Australian Dollar against the US Dollar – both your dividends and share prices will increase in value.

Macquarie Group Ltd (ASX: MQG)

Global investment bank Macquarie Group is another effective way to benefit from a weaker Australian dollar against a variety of currencies including the USD and the Euro. The sensitivity analysis in Macquarie’s latest annual report shows that a 1% decline in the Australian Dollar against the US Dollar, Pound, Canadian Dollar, and Euro, would result in a $77 million, or 3.7%, increase in profit after tax.

The 1 Thing Every Investor Should Know About Buffett's Portfolio

You've probably heard a lot about billionaire investor Warren Buffett. After all, a herd of analysts and journalists has tracked his every move - for decades. Yet here's something you may not know...

Simply click here to learn more.

Motley Fool contributor Sean O'Neill has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.