Betashares launches currency hedged US ETF
Betashares has launched a currency hedged version of its S&P 500 Equal Weight ETF.
The Betashares S&P 500 Equal Weight Currency Hedged ETF (HQUS) provides exposure to 500 leading listed US companies, with each holding in the index weighted equally and the foreign currency exposure hedged back to the Australian dollar.
Betashares currently offers 23 currency hedged ETFs for Australian investors.
The original S&P 500 Equal Weight ETF was launched in 2014 and has over $380 million in funds under management. The ETF allows investors to maintain exposure to a broad portfolio of US equities without being heavily exposed to a select number of mega-cap companies.
This is particularly important given the dominance of the Magnificent Seven stocks of Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla which make up a large percentage of the index.
CEO Alex Vynokur said: “The equally weighted version of the S&P 500 index offers exposure to the US share market, while at the same time reducing some of the concentration risks associated with its market capitalisation weighted equivalent. As a result of the launch of HQUS, investors will be able to obtain currency hedged exposure to an equally weighted version of the S&P 500 Index in their portfolio.
“HQUS expands the range of investment options available that seek to minimise the impact of currency fluctuations on investment performance.”
Earlier this month, Global X launched a currency-hedged version of its FANG+ ETF, which provides exposure to the major 10 technology companies. Global X described the ETF as offering a “core building block for growth-orientated portfolios”.
Evan Metcalf, chief executive of Global X, said the decision had been taken to launch a currency-hedged version of the product as a way for Australian investors to minimise currency risk.
“The Australian dollar has softened considerably over the past two years, and given this fluctuation, our clients are seeking to include AUD-hedged products in their portfolios. Given FANG is entirely exposed to the USD, FHNG presents a strategic way to achieve this minimised currency risk, while still offering a high growth opportunity.”
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Laura Dew
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