iShares has launched three currency hedged ETFs designed to reduce the impact of currency fluctuations on returns when investing in foreign countries.
The new funds are the iShares Currency Hedged MSCI EAFE ETF (NYSE Arca; HEFA), the iShares Currency Hedged MSCI Germany ETF (NYSE Arca: HEWG) and the iShares Currency Hedged MSCI Japan ETF (NYSE Arca: HEWJ).
By investing in their related unhedged, parent ETFs (EFA, EWG and EWJ) the funds will benefit from the liquidity of those ETFs, which are expected to provide the ability to efficiently create and redeem shares, according to iShares.
The funds track indexes by MSCI and are managed by BlackRock‘s Index Asset Allocation Team.
“iShares Currency Hedged ETFs offer an efficient and cost-effective solution in a single transaction, so investors don’t have to manage complex currency hedging strategies. Investors with positive views on Japanese, German or EAFE equities, but negative views on local currencies relative to the U.S. dollar, would be interested in these ETF funds,” said Daniel Gamba, head of iShares Americas Institutional Business at BlackRock.