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Record to provide currency signals for new suite of WisdomTree models-based active ETFs


Specialist currency manager Record Currency Management Limited (Record) has extended its licensing relationship with WisdomTree, the New York-headquartered exchange-traded fund and exchange-traded product sponsor and asset manager.

In January 2016, Record announced that it had entered into a licensing agreement with WisdomTree Investments to provide currency signals that are used to dynamically hedge currency exposures in a rules-based manner within WisdomTree’s index family. Record has now agreed a further licensing agreement with WisdomTree to provide currency signals for use in connection with a new range of models-based active exchange-traded funds from WisdomTree.
These new signals from Record determine hedge ratios for developed market currencies on a monthly basis, and for emerging market currencies every two weeks. The framework for the emerging market signals represents a new development in tailoring currency hedging to the specific characteristics of these currencies. Instead of systematically incurring the costs of hedging emerging market currencies, this new framework aims to refine the proportion hedged on a currency-by-currency basis to limit exposure to the pronounced drawdowns that are characteristic of emerging markets, while maintaining exposure to their inherent growth opportunities.
James Wood-Collins, Record’s Chief Executive, says: “We greatly value the overall relationship we have built with WisdomTree, one of the pioneers in indexing and one of the largest exchange-traded product sponsors globally, over the last three years. We are delighted to be extending the licensing relationship, both in respect of providing active developed market currency hedging signals to WisdomTree, and particularly through developing a new approach to emerging market currency signals which provides an innovative way to manage currency risk. We are confident that this approach can also be applied in a broad number of contexts, including for Record’s own clients and investors.”

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