State Street Gets Into the Currency Hedged ETF Game

HFEZ has the potential to offer investors a currency hedged avenue to recovering European dividend growth. Investors are pressuring European countries to send more cash to shareholders as U.S. companies have engaged in hefty dividend hikes and record stock repurchases, rewarding investors with over half of operating cash flows – about 28% was allocated to buybacks and 24% to dividends. In contrast, the overall figure was only one-third for European stock investors. [Europe ETFs With Juicy Yields]

According to Markit research, European company stock payouts jumped 10.3% in the fiscal 2014 year-over-year, the fastest dividend growth since 2010, reports Dhara Renasinghe for CNBC.

““European equities are attractive in light of recent accommodative monetary policy and improving economic activity,” said Michael Arone, chief investment strategist for the US Intermediary Business at SSGA, in a statement. “An allocation that is divided between hedged and unhedged exposures may help investors and advisors reduce the risk of future currency fluctuations, which is why we see HFEZ as a natural complement to our popular SPDR EURO STOXX 50 ETF.”

FEZ Top 10 Holdings

Table Courtesy: SSgA