Security means that foreign exchange reserves should be kept in countries with political stability and strong economic strength and banks with high reputation, and always pay attention to the political and business trends of these countries and banks; We should choose currencies with low risk and relatively stable currency value, pay close attention to the balance of payments and economic situation of these currency issuing countries, predict the exchange rate trend, adjust the currency structure in time, and reduce the exchange rate and interest rate risks; We should also invest in safer credit instruments, such as national bonds with high reputation or institutional bonds guaranteed by the state.
Liquidity refers to ensuring that foreign exchange reserves can be cashed at any time and used for payment, and redemption can be realized at the lowest cost. When arranging foreign exchange assets, countries should make reasonable arrangements for the investment term combination according to their own forecasts of foreign exchange receipts and payments in a certain period, and consider dealing with emergencies. Cash and treasury bonds are more liquid, followed by medium-term treasury bonds and long-term treasury bonds.
Profitability means that under the premise of ensuring safety and liquidity, through the analysis and prediction of market trends, we can determine a scientific investment portfolio, seize market opportunities, invest and trade assets, and realize the preservation and appreciation of reserve assets.
However, security, liquidity and profitability cannot be completely achieved. Generally, only high risks can bring high returns, and assets with high returns will inevitably have poor security, while assets with strong security and liquidity will inevitably have low returns. Therefore, when managing foreign exchange reserves, countries often have their own emphasis. For example, rich countries pay more attention to liquidity in order to intervene in the foreign exchange market or use it for external payment at any time, while small countries and resource-poor countries pay more attention to value appreciation and wealth accumulation. Generally speaking, we should give consideration to these three principles as much as possible, adopt a combination strategy, "don't put all your eggs in one basket", and diversify foreign exchange reserves to reduce risks and realize appreciation.