These hedged equity ETFs could outperform a non-hedged ETF as the foreign currency depreciates against the U.S. dollar. Over the past month, DBEU is 6.4% lower and HEDJ is down 7.1%. In contrast, VGK declined 8.2% and EZU decreased 9.2% over the past month. Meanwhile, the euro currency has depreciated 1.7% against the USD.
Europe ETF asset outflows quickened from October 10 after global markets declined, and outflows continued due to the heightened volatility. Many investors remain wary over the Eurozone’s growth outlook.
Earlier in October, the International Monetary Fund warned that there is a 40% the Eurozone could fall into another recession. Nevertheless, the purchasing managers’ indices data indicated that economic activity over October has been better-than-expected.
For more information on ETFs, visit our ETF performance reports category.
Max Chen contributed to this article.