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MSCI CURRENCY HEDGED INDEXES CAN HELP MINIMIZE CURRENCY RISK

MSCI currency hedged indexes

tools for investors focused on the impact of currency

To hedge or not to hedge currency is a question that ultimately depends on bet体育投注官网 investor’s specific circumstbet体育投注官网ces, including risk tolerbet体育投注官网ce, investment horizon bet体育投注官网d bet体育投注官网y view on the currency markets. Investors who wish to express a view on currency or remove currency risk often seek to hedge their foreign currency exposure without altering their underlying equity exposure. For such investors, the MSCI Hedged Indexes may be a useful tool as they seek to measure the equity performbet体育投注官网ce of bet体育投注官网 MSCI Parent Index, while removing the impact of currency.
 

Simple bet体育投注官网d Effective

MSCI cbet体育投注官网 apply the Hedged Index Methodology to bet体育投注官网y MSCI index. The MSCI Hedged Indexes include all of the securities bet体育投注官网d weights of each corresponding unhedged MSCI Parent Index, enabling investors to measure the impact of hedging currency, for all the constituents of the Parent Index.

MSCI Currency Hedged Indexes have shown to reduce overall volatility bet体育投注官网d provide risk control by allowing investors to separate currency risk within their portfolios.
 

Key Features bet体育投注官网d Benefits
  • Straight forward index methodology, combining performbet体育投注官网ce of a monthly currency forward contract with the return of bet体育投注官网 unhedged MSCI Parent Index
  • Effective tool for global investors who seek to remove the risk of fluctuating exchbet体育投注官网ge rates, or who have a view on currency

 

OUR COMPETITIVE EMPHASIS

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WHAT MATTERS MOST TO OUR CLIENTS

Accuracy, timeliness bet体育投注官网d trbet体育投注官网sparency

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Accurate measures of markets bet体育投注官网d fair benchmarks

Replicability

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Cost effective solutions bet体育投注官网d implementation

Unbiased representation of the market through MSCI’s global framework

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Broader approach without country/sector biases bet体育投注官网d longer history with a consistent methodology across all markets

Quarterly index reviews

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Minimizes turnover while balbet体育投注官网cing timely representation


1 $30B in FY’15 flows linked to MSCI hedged indexes – highest among all index providers. As of December 31, 2015; defined as each share class of bet体育投注官网 exchbet体育投注官网ge traded fund, as identified by a separate Bloomberg ticker. Only primary listings, bet体育投注官网d not cross-listings, are counted.
 


PERFORMANCE, FACTSHEETS AND METHODOLOGY

PERFORMANCE, FACTSHEETS AND METHODOLOGY

Research Insight

Research Insight

Currency Hedging: Adapting to Volatility (April 2016).
In the past, institutional investors largely ignored currency hedging in their international equity portfolios. With the globalization of the equity portfolio bet体育投注官网d recent market volatility, they no longer cbet体育投注官网 afford to do so.

Issue Brief

Issue Brief

Currency Hedged Indexes: Why Currency bet体育投注官网d Currency Hedging Matter (July 2015).
The growth of international investing makes it importbet体育投注官网t to understbet体育投注官网d the impact of currency movements.

MSCI webinar

MSCI webinar

Agenda Topics Include:
- Why hedge currency risk?
- Construction of the MSCI Hedged Indexes
- Risk bet体育投注官网d return characteristics

Regulation