Roughly one third of Deutsche Bank’s 30 exchange-traded fund (ETF) offerings provide investors with direct exposure to foreign markets, while also engaging in currency hedging to mitigate the risk of fluctuating exchange rates. While the dollar has not been particularly strong for the past decade, unpredictable quantitative-easing moves by both the European Central Bank and the Bank of Japan can affect currency valuations.
One of Deutsche Bank’s ETFs, db X-trackers MSCI EAFE Hedged Equity Fund (DBEF), seeks to reflect the stock performance of developed, non-U.S. economies, while limiting exposure to the fluctuation of strength between the U.S. dollar and other currencies. So far this year, DBEF has seen a small loss of 0.47%, but it has a dividend yield of 1.51%, with its dividends typically paid in June or December. In 2013, DBEF gained 24.30%.
While a currency hedge is not a top investing priority for Americans until the dollar shows signs of strength, Deutsche Bank’s db-Xtrackers hedged currency offerings provide a measure of protection for when that day comes. Until then, Deutsche Bank offers an array of broad-based commodity indices which may be more relevant to today’s market.
Read more about how you can take advantage of Deutsche Bank’s access to foreign markets at Eagle Daily Investor.