Related: Why Europe ETFs Are Still in Play
ETF investors who are interested in the Europe story have a number of options available, such as the iShares Core MSCI Europe ETF (NYSEArca: IEUR), which is seen as a cheaper “core” alternative to older iShares Europe ETF (NYSEArca: IEV), along with the iShares MSCI EMU ETF (NYSEArca: EZU), which is comprised of of euro member states.
“A much stronger euro is another risk,” according to BlackRock. “This would be a threat to corporate earnings and export growth, and could complicate the European Central Bank’s efforts to reach its inflation target.”
Alternatively, investors who believe the euro currency could weaken after its recent rally and are bullish on the Eurozone’s outlook can turn to currency-hedged ETF options, such as the the Deutsche X-trackers MSCI EMU Hedged Equity ETF (NYSEArca: DBEZ), iShares Currency Hedged MSCI EMU ETF (NYSEArca: HEZU) and WisdomTree Europe Hedged Equity Fund (NYSEArca: HEDJ). These currency-hedged Europe ETFs may outperform non-hedged Europe funds if the euro depreciates against the U.S. dollar.
For more information on European markets, visit our Europe category.