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Currencies Can Have A Role In Your ETF Portfolio

Contributed by David Fabian of FMD Capital Management.     If you have been following the ETF industry at even a cursory level, it’s been difficult to miss the fervor surrounding currency-hedged funds.  This dynamic strategy first burst onto the scene with the release of the WisdomTree Japan Hedged Equity Fund (DXJ) in 2006.  DXJ quickly amassed an impressive track record as its dual threat of equity and currency exposure propelled it into the spotlight.  Assets soon followed and the fund has since grown to $9.1 billion in size.

This success was then shadowed by a slew of successive international indexes trying to capitalize on the currency hedged theme.  There now exists nearly 100 ways to play this space that include: broad baskets, regional indexes, single countries, and more.

Editor's Note:

Baseline Analytics TrendFlex applied to the following Currency ETF's (updated from 5/4/16 market close): 

 Symbol  Trend  Date Trend Change Risk
 FXF  BULLISH  4/25/16 LOW

David Fabian is Managing Partner and Chief Operations Officer of FMD Capital Management. David began his investment career in 2007 by co-founding a fee-only registered investment advisory firm and swiftly grew that company to over $100 million in assets. In 2013 he started FMD Capital Management with the commitment to build a world class investment firm focused on client service, investment discipline, and accountability. He has years of experience implementing actively managed growth and income portfolios using ETFs and mutual funds. David is often quoted in the Wall Street Journal and writes a daily ETF column for Benzinga. He is also a regular contributor on Investopedia, Seeking Alpha, Minyanville, TheStreet, InvestorPlace Media, and David’s contact information: or 888-823-8111 x286


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