The Shark Tank personality, Kevin O’Leary, expanded his line of O’Shares Investments exchange traded funds, rolling out two currency-hedged versions of existing Asia and Europe quality dividend ETFs.
On Tuesday, the O’Shares FTSE Asia Pacific Quality Dividend Hedged ETF (NYSEArca: OAPH) and O’Shares FTSE Europe Quality Dividend Hedged ETF (NYSEArca: OEUH) began trading.
OAPH tries to reflect the performance of the FTSE Asia Pacific Qual / Vol / Yield Factor 5% Capped Hedged 100% to USD Index, which is designed to measure the performance of large- and mid-sized dividend paying stocks in the Asia Pacific based on market cap, liquidity, quality, low volatility and dividend yield.
Unlike the recently launched O’Shares FTSE Asia Pacific Quality Dividend ETF (NYSEArca: OASI), which tracks the FTSE Asia Pacific Qual / Vol / Yield Factor 5% Capped Index, OAPH hedges agaisnt fluctuations in the relative value of foreign currencies denominated against the U.S. dollar. [More Shark Tank ETFs]
“Thus, it is designed to have higher returns than an equivalent fund that does not hedge against a weakening of such foreign currencies relative to the U.S. dollar,” according to O’Shares. “Conversely, the O’Shares FTSE Asia Pacific Quality Dividend Hedged ETF would be expected to have lower returns than an equivalent unhedged fund when these foreign currencies are rising in value relative to the U.S. dollar.”
OAPH country tilts include Japan 43.9%, Australia 23.3%, Hong Kong 19.2%, Singapore 7.2% and other 6.5%.
Sector tilts include financials 17.7%, industrials 16.1%, consumer services 15.2%, consumer goods 11.5%, telecom 10.5%, basic materials 10.2%, health care 7.2%, utilities 5.4%, oil & gas 3.8% and tech 2.4%.
Top holdings include BHP Billiton 4.6%, CK Hutchison Holdings 3.3%, NTT Docomo 3.2%, Samsung Electronics 2.6% and Wesfarmers 2.6%.
OEUH tries to reflect the performance of the FTSE Europe Qual / Vol / Yield Factor 5% Capped Hedged 100% to USD Index, which tracks large- and mid-sized dividend paying companies from Europe based on market-cap, liquidity, quality, low volatility and dividend yield.
Unlike the O’Shares FTSE Europe Quality Dividend ETF (NYSEArca: OEUR), which tracks the FTSE Europe Qual / Vol / Yield Factor 5% Capped Index, OEUH hedges against fluctuations in the relative value of foreign currencies denominated against the USD.
“It is designed to have higher returns than an equivalent fund that does not hedge against a weakening of such foreign currencies relative to the U.S. dollar,” according to O’Shares. “Conversely, the O’Shares FTSE Europe Quality Dividend Hedged ETF would be expected to have lower returns than an equivalent unhedged fund when these foreign currencies are rising in value relative to the U.S. dollar.”
OEUH country weights include U.K. 43.1%, Switzerland 19.6%, France 12.9%, Germany 6.2%, Sweden 5.0%, Netherlands 4.6%, Spain 3.2% and other 5.4%.
Sector tilts include health care 19.4%, consumer goods 19.3%, oil & gas 11.4%, telecom 11.4%, financials 10.4%, industrials 8.2%, consumer services 8.1%, utilities 7.5%, basic materials 3.5% and tech 0.8%.
Top holdings include Novartis 5.1%, Nestle 5.0%, Roche Holdings 4.9%, Vodafone Group 4.6% and British American Tobacco 4.4%.
Both OAPH and OEUH come with a 0.68% expense ratio, or 10 basis points more than the unhedged OASI and OEUR.
For more information on new fund products, visit our new ETFs category.
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Max Chen contributed to this article.