Daily ETF Watch: 11 Hedged Funds Debut

Today iShares is rolling out 11 more funds that will capitalize on the trend toward currency hedging. The new funds cover three regions and seven individual countries. The ETF provider already has three currency-hedged regional ETFs and two currency-hedged country funds—one covering Japan and the other covering Germany.

The new funds, as in the case of the rest of iShares’ currency-hedged lineup, are able to invest in their unhedged iShares counterparts and apply a currency hedge to achieve their target performance. The ETFs, as well as their tickers and expense ratios, are as follows:

• iShares Currency Hedged MSCI United Kingdom ETF (HEWU), 0.48 percent, or $48 per $10,000 investment
• iShares Currency Hedged MSCI Italy ETF (HEWI), 0.48 percent
• iShares Currency Hedged MSCI Switzerland ETF (HEWL), 0.51 percent
• iShares Currency Hedged MSCI Spain ETF (HEWP), 0.51 percent
• iShares Currency Hedged MSCI South Korea ETF (HEWY), 0.62 percent
• iShares Currency Hedged MSCI Mexico ETF (HEWW), 0.51 percent
• iShares Currency Hedged MSCI Australia ETF (HAUD), 0.51 percent
• iShares Currency Hedged MSCI Canada ETF (HEWC), 0.51 percent
• iShares Currency Hedged MSCI ACWI ETF (HACW), 0.36 percent
• iShares Currency Hedged MSCI ACWI ex U.S. ETF (HAWX), 0.36 percent
• iShares Currency Hedged MSCI EAFE Small-Cap ETF (HSCZ), 0.43 percent

Several of the funds already have direct competitors in Deutsche Bank’s lineup of ETFs that track the exact same indexes. However, none of those Deutsche X-trackers have corresponding unhedged ETFs trading.

HEWU is actually 3 basis points more expensive than the Deutsche X-trackers MSCI United Kingdom Hedged Equity ETF (DBUK | D-60).

Similarly, the Deutsche X-trackers MSCI Mexico Hedged Equity ETF (DBMX | C-55) and the Deutsche X-trackers MSCI South Korea Hedged Equity ETF (DBKO | C-55) are cheaper than HEWW and HEWY by 1 and 4 basis points, respectively.

The Deutsche X-trackers MSCI All World ex US Hedged Equity ETF (DBAW | C-60), however, costs 40 basis points versus HAWK's 36 basis point annual expense ratio.