For better or for worse, the movements in the Australian dollar are largely influenced by commodity prices. It was a significant factor that pushed the dollar through parity against the USD and is also why the currency has remained stubbornly strong in recent years. 

Donald Amstad from Aberdeen Standard Investments says that this relationship provides Australian investors with a competitive advantage when it comes to investing in emerging market debt. He explains that the asset class moves from having high expected returns with high volatility to high expected returns with low volatility, when accessed in Australian dollars. 

So why does this advantage exist? Find out in the short video below. 

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