Savings accounts in Dominican Banks

[frenchfamilly]

Good morning all

Small question to expats who have opened paid accounts in Dominican banks.

Investments in dollars, euros or pesos are generally limited over a fixed period (one year, three years, etc.), the rates depend on the duration and the amount placed, then on the anniversary date the client decides whether to renew or not.

In view of the current situation of the covid crisis and the economic repercussions that the Dominican Republic will have to face, what is your feeling on these investments, is it wiser to recover your money or to re-invest?

Thank you for sharing your ideas please.

Have a good week-end.

 

[william webster]

And factor in the exchange rate

 

[cavok]

Investments in USD or EUR are probably ok, but peso investments have taken a huge hit from the recent devaluation. You'd really have to see what you could get if you sell out. Run some numbers to see what kind of return you'll get going forward if you don't sell vs what options you have if you do.

 

[Yourmaninvegas]

Cash is not usually considered an investment. But with the peso at a historically low valuation against the dollar in my opinion it pays to stack 3 to 6 months of expenses you plan to pay in pesos.

 

[playacaribe2]

Good morning all

Small question to expats who have opened paid accounts in Dominican banks.

Investments in dollars, euros or pesos are generally limited over a fixed period (one year, three years, etc.), the rates depend on the duration and the amount placed, then on the anniversary date the client decides whether to renew or not.

In view of the current situation of the covid crisis and the economic repercussions that the Dominican Republic will have to face, what is your feeling on these investments, is it wiser to recover your money or to re-invest?

Thank you for sharing your ideas please.

Have a good week-end.

Challenging economic times lie ahead for the DR.........and please do not buy peso CD's unless you want to send your money to die......challenging times, triggered by the coronavirus pandemic......

Respectfully,
Playacaribe2

 

[bob saunders]

I have some $US in the BHD 30 DAY FONDO https://bhdfondos.com.do/. It doesn't gain much but I think it is pretty secure. I always keep a balance of at least 100, 000 pesos in my peso account.

 

[DR Solar]

Good morning all

Small question to expats who have opened paid accounts in Dominican banks.

Investments in dollars, euros or pesos are generally limited over a fixed period (one year, three years, etc.), the rates depend on the duration and the amount placed, then on the anniversary date the client decides whether to renew or not.

In view of the current situation of the covid crisis and the economic repercussions that the Dominican Republic will have to face, what is your feeling on these investments, is it wiser to recover your money or to re-invest?

Thank you for sharing your ideas please.

Have a good week-end.

You have asked the questions. As an invester, You should already know the answers.

 

[johne]

Why invest in something that is "fixed" yet not stable? By investing you are making a "statement". What do you know about the next 12 months that gives you the confidence to make this investment. Isn't that more like "betting"than "investing".

 

[JD Jones]

I invested in Banco Central CD's for years. I remember when I first started years ago at the suggestion of a friend.

I did very well for many years with the high interest rate CD's but stopped once the banks took over. It doesn't make much sense anymore.

Then again, I haven't educated myself about the short term notes like Bob is using so it may be time to start looking at those.

Just like everywhere else in the world the interest paid on savings accounts are laughable.

 

[Yourmaninvegas]

Why invest in something that is "fixed" yet not stable?

I guess it would depend on what is "fixed". Term as the OP originally stated, Interest rate or Currency. We do not know because it is not entirely clear from the original post.

Investments in dollars, euros or pesos are generally limited over a fixed period (one year, three years, etc.), the rates depend on the duration and the amount placed, then on the anniversary date the client decides whether to renew or not.
In view of the current situation of the covid crisis and the economic repercussions that the Dominican Republic will have to face will have to face, what is your feeling on these investments, is it wiser to recover your money or to re-invest?
Thank you for sharing your ideas please.

You are welcome. Here are mine:
We all know currency is not fixed. But if you are investing in DOP and you will use the DOP earned from your investment to pay expenses at the end of the term then a DOP is a DOP is a DOP. And my measurement would be based on return minus the anticipated inflation rate in the Dominican Republic. Trending annual inflation rate July 2020 is 4.35% .
So, I would look for a return in excess of that for the term I considered investing if I could be certain of the return of my money if I considered it method to earn a investment on my cash in pesos. Things get quite a bit more complicated if I am looking to invest in DOP gain my return and convert back into the currency that my personal economic situation is based on. Even if you plan to use DOP to pay for things in DOP you could face a currency devaluation from the Dominican Government. A lot of ifs. But it is YOUR answer to these ifs that determine if you should recover your money or re-invest.

Dominican Republic Inflation Rate

Inflation Rate in Dominican Republic decreased to 3.30 percent in February from 3.32 percent in January of 2024. This page provides - Dominican Republic Inflation Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

tradingeconomics.com

What do you know about the next 12 months that gives you the confidence to make this investment. Isn't that more like "betting"than "investing".

To answer your question (even if you did not ask me) if you did things in the way I described it would not be more like betting than investing. Check your punctuation next time. It was incorrect. That is a fact!

Bet: “risk a sum of money or valued item against someone else's on the basis of the outcome of an unpredictable event such as a race or game”. So is the economic situation of the Dominican Republic such that you consider it “unpredictable” event? I think not. But that is my opinion.

Who answers a question with a question? This is not a law school using the socratic method of teaching. People come to this public forum looking for answers and opinions not your questions as a response.

 

[johne]

I guess it would depend on what is "fixed". Term as the OP originally stated, Interest rate or Currency. We do not know because it is not entirely clear from the original post.


You are welcome. Here are mine:
We all know currency is not fixed. But if you are investing in DOP and you will use the DOP earned from your investment to pay expenses at the end of the term then a DOP is a DOP is a DOP. And my measurement would be based on return minus the anticipated inflation rate in the Dominican Republic. Trending annual inflation rate July 2020 is 4.35% .
So, I would look for a return in excess of that for the term I considered investing if I could be certain of the return of my money if I considered it method to earn a investment on my cash in pesos. Things get quite a bit more complicated if I am looking to invest in DOP gain my return and convert back into the currency that my personal economic situation is based on. Even if you plan to use DOP to pay for things in DOP you could face a currency devaluation from the Dominican Government. A lot of ifs. But it is YOUR answer to these ifs that determine if you should recover your money or re-invest.

Dominican Republic Inflation Rate

Inflation Rate in Dominican Republic decreased to 3.30 percent in February from 3.32 percent in January of 2024. This page provides - Dominican Republic Inflation Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

tradingeconomics.com

To answer your question (even if you did not ask me) if you did things in the way I described it would not be more like betting than investing. Check your punctuation next time. It was incorrect. That is a fact!

Bet: “risk a sum of money or valued item against someone else's on the basis of the outcome of an unpredictable event such as a race or game”. So is the economic situation of the Dominican Republic such that you consider it “unpredictable” event? I think not. But that is my opinion.

Who answers a question with a question? This is not a law school using the socratic method of teaching. People come to this public forum looking for answers and opinions not your questions as a response.

Do it anyway you'd like my friend. Three paragraphs of horse turd advise that resulted in : telling me to check my punctuation. You are a pretty funny guy as I said yesterday in another one of your revelations. Personal question to you: I think I met you once in Savannah. Right?

 

[Yourmaninvegas]

Three paragraphs of horse turd advise that resulted in : telling me to check my punctuation. You are a pretty funny guy as I said yesterday in another one of your revelations.

My advice is better than your useless questions that provided NO information. Two separate posts from you that provided no information. At least the advice for you to check your punctuation was accurate and factual. But I see that you are very good at continuing to build your post count.
Care to share with us any useful information other than that you laugh a lot?

 

[playacaribe2]

I guess it would depend on what is "fixed". Term as the OP originally stated, Interest rate or Currency. We do not know because it is not entirely clear from the original post.


You are welcome. Here are mine:
We all know currency is not fixed. But if you are investing in DOP and you will use the DOP earned from your investment to pay expenses at the end of the term then a DOP is a DOP is a DOP. And my measurement would be based on return minus the anticipated inflation rate in the Dominican Republic. Trending annual inflation rate July 2020 is 4.35% .
So, I would look for a return in excess of that for the term I considered investing if I could be certain of the return of my money if I considered it method to earn a investment on my cash in pesos. Things get quite a bit more complicated if I am looking to invest in DOP gain my return and convert back into the currency that my personal economic situation is based on. Even if you plan to use DOP to pay for things in DOP you could face a currency devaluation from the Dominican Government. A lot of ifs. But it is YOUR answer to these ifs that determine if you should recover your money or re-invest.

Dominican Republic Inflation Rate

Inflation Rate in Dominican Republic decreased to 3.30 percent in February from 3.32 percent in January of 2024. This page provides - Dominican Republic Inflation Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

tradingeconomics.com

What is the old line in investing that "past performance is no guarantee of future results."

The trending annual inflation rate is a backward looking statement to try and predict future results.......or at least offer some.guidance. However, the peso has devalued 10% since January 1st and Dominican CD's are yielding 7,8,9% depending on length to maturity...............thus far that is not a sound "investment"......and as I am want to say.............if you wish to send your money to die..........."invest" in peso certificates.

Further, even if yields were to turn positive, investors in DOP also run currency conversion risk of 1-2% which can also reduce any effective yield. And yes there are those who say they are leaving it in pesos and thus have no currency conversion risk, as they live there, pay their bills etc in DOM pesos.

To those who choose to "invest" that way..............do not "invest" more than you need for current expenses and certainly do not "invest" to make money as the trend has not been kind to the DOP having had parity 1:1 with the dollar in the 1980's, and except for one brief period due to an IMF economic bailout, the peso has been declining ever since.


Respectfully,
Playacaribe2

 

[Yourmaninvegas]

What is the old line in investing that "past performance is no guarantee of future results."

The trending annual inflation rate is a backward looking statement to try and predict future results.......or at least offer some.guidance. However, the peso has devalued 10% since January 1st and Dominican CD's are yielding 7,8,9% depending on length to maturity...............thus far that is not a sound "investment"......and as I am want to say.............if you wish to send your money to die..........."invest" in peso certificates.

Further, even if yields were to turn positive, investors in DOP also run currency conversion risk of 1-2% which can also reduce any effective yield. And yes there are those who say they are leaving it in pesos and thus have no currency conversion risk, as they live there, pay their bills etc in DOM pesos.

To those who choose to "invest" that way..............do not "invest" more than you need for current expenses and certainly do not "invest" to make money as the trend has not been kind to the DOP having had parity 1:1 with the dollar in the 1980's, and except for one brief period due to an IMF economic bailout, the peso has been declining ever since.

I agree with you completely.

I would not consider "investment" in DOP. But in my personal opinion, it is not a bad idea to stack 3 to 6 months of personal expenses at the current exchange rate. That advice might not be a good idea for someone not in the same financial situation as I am. And I do not consider holding cash in DOP as a investment, but a way to hold cash that you need for future expenses.

In this case I would be more concerned about the return of my money than the return on my money. Sorry brother I do not have a time machine or crystal ball that would allow me to give forward thinking financial advice as some think they do. Who thinks USD does not have downside currency risk if the lame government operating over in the United States of America does not get a handle on the COVID-19 crisis?

 

[johne]

My advice is better than your useless questions that provided NO information. Two separate posts from you that provided no information. At least the advice for you to check your punctuation was accurate and factual. But I see that you are very good at continuing to build your post count.
Care to share with us any useful information other than that you laugh a lot?

I'll share this with you. I have never come across a seasoned investor who has asked for or has given advise on a public forum board that was worth more than one centavo. That's all I have to say mi amigo. Carry on while I go check my grammar book which seems to be more interesting to you than finding an answer to YOUR question.

 

[Yourmaninvegas]

I'll share this with you. I have never come across a seasoned investor who has asked for or has given advise on a public forum board that was worth more than one centavo. That's all I have to say mi amigo. Carry on while I go check my grammar book which seems to be more interesting to you than finding an answer to YOUR question.

Well you have just found the exception to your experience with a public forum. I never asked for your investment advice. I am a consumer. I am out of the real estate investment game. And if your actually read my posts you would understand that. That's all I have to say mi amigo.

Keep studying your grammar book and giving personal improvement advice as you side gig. Your main gig is investment advice. Right?