As investors diversify with overseas market exposure, investors can utilizes exchange traded funds to capture foreign equities and mitigate potential foreign exchange risks.
On the upcoming annual ETF Virtual Summit, an online conference experience hosted by ETF Trends and RIA Database on January 21, financial advisors will be able to glean various global investment strategies, including hedged-equity exchange traded funds that provided targeted exposure to overseas markets while hedging currency risks.
For instance, the Deutsche X-trackers MSCI Japan Hedged Equity ETF (NYSEArca: DBJP) and recently launched Deutsche X-trackers MSCI EMU Hedged Equity ETF (NYSEArca: DBEZ) can target the Japanese and Eurozone equities markets, respectively, while hedging against any further depreciation in their respective currencies. [Another ETF Option for Profiting From the Euro’s Slide]
Alternatively, something like the DeutscheX-trackers MSCI EAFE Hedged Equity Fund (NYSEArca: DBEF) takes on an even broader exposure, tracking developed Europe, Australasia and Far East countries. [An EAFE ETF to Capture Overseas Growth, Hedge Forex Risks]
Supporting the Japan and Eurozone outlook, their central banks have been enacting more aggressive monetary policies to help lift their economies out of a slump. The added accommodative measures should promote economic growth and lift company earnings. However, due to the increased liquidity, the Japanese yen and euro currencies are being devalued against the U.S. dollar.