'Diversify' cash holding

bearshare

I have a cash/equity portfolio, and am wondering if there is a simple way to reduce currency risk on the cash part (or even if it's a good idea!).
I have an Emergency fund in NS&I index trackers, which i probably will not use unless really pushed. For some of the rest, what would be the easiest/cheapest way to get some  Euro/$/etc cash exposure?

Albermarle

If you intend to spend the money in the UK in GBP then you would be effectively just currency speculating, which is rather risky.
If you are likely to have significant expenditure in non GBP currency , then would probably be worth it. 

georgehere

The reason it is viewed as not a good idea, is that folk fear inflation risk much much more than currency risk in developed markets. Keeping everything (all investments not just cash) in Sterling or hedged to Sterling, in theory, guards against inflation risk. Whether there is residual risk in Sterling for UK based spenders beyond inflation, is beyond me.

Notepad_Phil

Is there a particular reason you want to do this with your cash?

Personally I''d only diversify my cash into another currency if I'd some large transaction coming up in that currency. That doesn't apply to me, however I do have several years of pension income stored away and it's the inflationary risk I'm worried about. Fortunately my cash is stored outside of my pension and I've been able (so far) to match and beat CPI over the last few years -  I realise that would be more difficult if your cash is inside and that's the reason for your post.

But I certainly do diversify my investments across the globe using unhedged methods.

bearshare

Thanks for replies.
Yes, inflation in the UK, perhaps caused by a fall in the pound due to Brexit, etc. Cash is outside pension, ISA.  Investments are geographically diversified.