Understanding Modern Day Risks, Opportunities with International Markets

International equities have been lagging behind the U.S. markets for years but are finally having their moment in the sun as investors look beyond the pricey valuations in the domestic U.S. stocks and consider cheaper opportunities in both developed and emerging markets. However, foreign market exposure comes with its own set of idiosyncratic risks that financial advisors need to be prepped for.

On March 14, 2018, ETF Trends will be hosting its annual Virtual Summit, an online virtual conference environment where financial advisors can learn about current ETF issues, hear from industry experts and connect with peers without the burden of cost and traveling.

2018 ETF Trends Virtual Summit returns Wednesday, March 14! Earn 5 CE Credit – click to register!

On a panel titled, Understanding Modern Day Risks and Opportunities with International Markets, Rob Bush, Director and ETF Strategist for Deutsche Asset Management, Josh Rogers, Vice President and Beta Specialist for J.P. Morgan Asset Management, and Danton Goei, Portfolio Manager for Davis Advisors, will touch upon global investment opportunities and methods to limit risks when branching out into the international markets.

For instance, when gaining exposure to international equities, investors will be exposed to foreign exchange currency fluctuations. Nevertheless, there are currency-hedged equity ETF options, like the Xtrackers MSCI EAFE Hedged Equity ETF (NYSEArca: DBEF), that help limit currency risks when investing in foreign markets.

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.