Why Investors Should Always Currency Hedge | Page 2 of 2 | ETF Trends

For instance, when gaining exposure to international equities, investors can look to something like the Xtrackers MSCI EAFE Hedged Equity ETF (NYSEArca: DBEF).

As the U.S. dollar strengthens, foreign currencies would depreciate. If an investor holds a foreign stock that is denominated in the local currencies, a weaker foreign currency would translate to a lower USD-denominated return on that foreign equity exposure. DBEF provides exposure to equity securities in developed international stock markets, while at the same time mitigating exposure to fluctuations between the value of the U.S. dollar and non-U.S. currencies.

Additionally, something like the Xtrackers MSCI Emerging Markets Hedged Equity ETF (NYSEArca: DBEM) can provided a currency hedged way to access the emerging markets in case the U.S. dollar continues to strengthen.

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