DWMF - Currency Hedging: A Tool To Reduce Risk
2024-03-26 03:10:00 ET
Summary
- Currency hedging is crucial for mitigating risks in global investing by managing foreign exchange fluctuations while preserving equity exposure.
- Our dynamic currency-hedged ETFs have proven to reduce portfolio risk through factor-based strategies.
- The momentum factor’s increased weight in our currency model since 2023 has continued to lower portfolio risk despite more varied hedge ratios.
By Liqian Ren
In the complex world of global investing, currency risk plays a significant role. When investors allocate funds to foreign equities, they implicitly expose themselves to foreign exchange fluctuations. Currency hedging strategies aim to mitigate this risk while preserving the original equity exposure....
Currency Hedging: A Tool To Reduce Risk