How to Find the Right Currency ETF for You | ETF Trends

Currency exchange traded funds (ETFs) are not for everyone. But if you know what you’re doing, quick trades may produce some nice results.

Currency ETFs are an easy way for the average investor to gain exposure to world currencies, according to Forex Articles.

Experts note that currency ETFs require an understanding of their risks, how they work and the differences between them, as not all currency ETFs are created alike. An investor may offset individual currency risks by investing in a basket of various currencies, such as in one of these funds:

  • Barclays Global Emerging Market Strategy [GEMS] Asia 8 Index ETN (NYSEArca: AYT)
  • Barclay’s iPath Optimized Currency Carry Exchange Traded Note (NYSEArca: ICI)
  • PowerShares DB G10 Currency Harvest Fund (NYSEArca: DBV)
  • WisdomTree Dreyfus Emerging Currency Fund (NYSEArca: CEW)

Economic outlook of the country plays a large role in the strength of a country’s currency and corresponding ETF. A trader needs to consider the outlook, which can be affected by price of oil, trade balance inflation rate, political leadership, war, economic status and many more.

For more information on world currencies, visit our currency category. Or take a look at our ETF currency guide to see what other currency ETFs are available.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.