DBKO’s rapid growth comes just as investors are starting to embrace single-country currency hedged ETFs that are not Japan funds. Euro hedged Germany ETFs, including Deutsche’s Deutsche X-trackers MSCI Germany Hedged Equity Fund (NYSEArca: DBGR), have recently seen explosive asset growth. However, prior to that, investors have favored yen hedged funds among single-country currency hedged offerings.
This year, currency hedged ETFs have attracted over $12 billion in inflows, 90% of which has gone to non-Japan funds. Like their Germany counterparts, DBKO and DXKW are giving investors reason to consider the currency hedge.
DBKO and DXKW are up an average of 4% this year while the unhedged iShares MSCI South Korea Capped ETF (NYSEArca: EWY) has traded slightly lower.
Deutsche X-trackers MSCI South Korea Hedged Equity ETF