ETF spotlight on db-X MSCI EAFE Currency-Hedged Equity Fund (NYSEArca: DBEF), part of an ongoing series.
Assets: $4.5 million.
Objective: The db-X MSCI EAFE Currency-Hedged Equity Fund tries to reflect the performance of the MSCI EAFE U.S. Dollar Hedged Index, which provides exposure to equity securities in developed international stock markets while limiting the impact of price fluctuations between the the U.S. dollar and other foreign currencies. [ETFs That Hedge Their Foreign-Currency Exposure]
Holdings: The fund holds 95% in foreign stocks and 5% in futures contracts.
What You Should Know:
- Deutsche Bank sponsors the fund.
- DBEF has an expense ratio of 0.36%.
- The fund is up 3.20% in the last month and down 9.23% over the past three months.
- Country allocations include: Japan 19%, United Kingdom 17%, France 9%, Switzerland 9%, Germany 9%, Australia 7%, United States 5%, Netherlands 5%, Hong Kong 4% and other 16%.
- Sector weightings include: Banking 9%, Non-cyclical Consumer 7%, Energy 7%, Financial 6%, Futures 5%, Pharmaceuticals 5%, Telecommunications 5%, Basic Materials 4%, Insurance 3% and others 49%.
- The MSCI EAFE tracks the performance of major international developed equity markets.
- “This ETF invests in equities denominated in euro, yen, and pound, but since this is a currency-hedged fund, DBEF is not exposed to changes in exchange rates between the U.S. dollar and the aforementioned currencies,” Morningstar analyst Patricia Oey said.
- “These companies still provide a very safe and stable investment in global growth and provide some diversification benefits through somewhat different geographic reach,” Oey added.
The Latest News:
- On Oct. 18, trading volume in the DBEF fund surged up to 1.15 million shares compared to its average of around 27,000.
- European equities rallied Wednesday on growing optimism that Europe’s leaders will raise the size of the financial-rescue fund during the summit this weekend, Bloomberg reports.
- “All eyes are now on the Sunday meeting and if the European finance leaders are able to deliver a substantial enough bailout deal to effectively backstop the European credit concern,” Ian Lyngen, a government bond strategist at CRT Capital Group LLC, said. “There’s less certainty they’ll be able to reach a meaningful deal than there was into yesterday’s close.”
db-X MSCI EAFE Currency-Hedged Equity Fund
For past stories in this series, visit our ETF Spotlight category.
Max Chen contributed to this article.