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Let's consider the topic 
of safe-haven currencies.

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A safe-haven currency is one 
which does well in bad times.

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So when the global economy 
becomes riskier

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or something bad happens,

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some currencies tend to appreciate

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because they are considered 
safe havens for investors.

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The classic example here is the US dollar.

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During the American
financial crisis of 2008-2009,

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a lot of really bad things happened
to the United States economy.

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Yet, oddly, at these exact same times,

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quite often the value of the US dollar
would rise on world markets.

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This may seem counter-intuitive, 
but it's reflecting a safe-haven effect.

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People figure that 
if things get really bad,

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well, a lot of different assets 
and asset classes will be in trouble,

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and they ask themselves,

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"Well, which is actually the safest 
of those remaining?"

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And the US dollar, actually, 
in the minds of investors,

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does pretty well on that score.

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Another safe-haven currency,
very frequently, is the Japanese yen.

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And another safe-haven currency 
is the Swiss franc.

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Like Japan, Switzerland has a reputation
for being a very sound and stable place.

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It's certainly perceived 
as such by investors.

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So during bad or risky times,

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there's often an inflow of money 
into Switzerland

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and an appreciation of the Swiss franc.

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What are the factors behind 
what might be a safe-haven currency?

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Well, there's some disagreement here,

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but overall some of
those factors would include

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the long term stability 
of purchasing power in that currency,

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the general geopolitical outlook 
for that country,

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its monetary and fiscal policies 
and how good those are,

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the size and safety of the country;

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that's one factor 
favoring the United States;

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whether that country has 
a significant role in global trade

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including the use of that currency 
as a reserve currency;

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that would probably be 
robust even in bad times.

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Quite important is the liquidity 
of markets for that currency

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and, also, the net asset position 
of the country;

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simply, how much wealth 
has that country accumulated

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relative to how much 
it owes other parties.

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There are some other potential 
safe-haven current,

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sometimes, but not always cited.

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Those would include the euro, 
sometimes, the Korean won,

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or even the Norwegian crown.

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If you go back to the previous list,

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you'll find that these are not nearly 
as safe haven, at least as of 2013,

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as the US dollar, the Japanese yen,
and the Swiss franc.

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It might sound like a good thing
to be holding a safe-haven currency,

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well, maybe it is because, in bad times,
it gives you more protection;

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that's a kind of insurance.

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But, keep in mind, there's always 
trade-offs in economic activity.

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So a currency which is giving you
more insurance protection upfront

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is probably paying you,
all other things equal, lower returns.

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So, just keep this in mind,

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there is a trade-off 
between risk and return

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when considering the costs and benefits
of holding safe-haven currencies.

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For more on this topic,
the best place to start

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is simply to put 
"safe-haven currency" into Google

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and also into scholar.google.com.